Home Business Insights & Advice Is it time to be transparent about pay?

Is it time to be transparent about pay?

by Sponsored Content
20th Jul 21 3:06 pm

It’s common for business owners to be cautious about who knows what about their company, especially those on the outside such as competitors. But when it comes to your team, being open with certain aspects of how the business is run is a great way to show your trust in them. But there are some things that often get swept under the rug when it comes to being transparent and one of those is pay/salaries.

Pay transparency is the idea that you as a company discuss the process of paying staff and how these decisions are made with your staff. The idea is one of fairness and is increasingly being seen as a positive and healthy practice. So why would someone want to be secretive about what they pay people and how they value certain roles? Firstly, an argument to preserve a level of secrecy here is to avoid arguments amongst staff members. It’s also been argued that transparency in this area can backfire once employees figure out that they’re earning less than others and therefore reduce their own productivity.

However, pay transparency does not mean we have to publish salaries so that employees find out what everyone else is earning. Research shows that the process of how someone is treated is much more important than the outcome of the reward. From an employee’s perspective, pay transparency leads to fairness because when we’re open and transparent, we’re demonstrating that we have nothing to hide because the process is fair and equitable. Therefore, with pay transparency we’re not necessarily sharing the outcomes but our thought process and that builds trust with employees.

Fairness in the workplace

Fairness and equality in the workplace is valued highly in the world today, as it should be. Treating your employees in a just and individual manner and making sound, positive decisions to not only benefit your business, but to promote unity and healthy work practices is a great way to improve morale and can ultimately benefit your business. Ensuring employees and candidates for new roles are aware of how their pay is calculated and their value determined will help rectify inconsistencies and promote an overall fairness in the business. Showing that you have positive, fair values as a company will serve you well in the long run as your employees will gain fair more respect and will feel proud to be a part of what you’re creating.

Handling pay transparency and dealing with possible issues

Figuring out the best way to handle this transparency can be confusing at times. You may have negotiated on a salary for a particularly stubborn yet essential member of your team in the past, who now earns significantly more than other staff, perhaps even of those in the same role. If you’re struggling to think of an effective way of restructuring the way in which you pay employees or dealing with unexpected outcomes of newly found transparency in the workplace, consider looking into hiring a pay consultancy team such as 3R Strategy in London. Using this pay consultancy service to manage things like job evaluation and levelling, reward principles, pay benchmarking and even tackle equal pay issues can help you to ensure your team is happy and understanding of your decisions and what’s expected of them. The main thing here is to be open and honest. Most people will respect this, and if you provide incentives such as information on how staff can progress through your business structure, as well as what benefits they’ll get for doing so, you may even see a huge boost to their productiveness.

What else could you be transparent about and why

Other than being open about pay and how it is calculated, promoting a transparent workplace environment can come in a few different forms. Firstly, you can encourage executive members of the team to be open about how well the company is doing, both good and bad. Providing this level of feedback to your team gives everyone a sense of belonging and can inspire better quality work and dedication. Remember, a good leader doesn’t condemn and bully their workers—they inspire and support them. Maybe you’re not too concerned with being seen as somewhat of a tyrant. But it’s well known now that that isn’t the way to conduct good business. Plus, you may find yourself getting into a heap of trouble down the line when people decide to report your practices.
You could even encourage transparency from your staff too. Providing the team with a means to share feedback without judgement or consequences is a good way of improving morale. If your team is not afraid to tell you what they don’t like or what they need in the workplace, you’ll be able to increase their quality of life and boost their happiness.

Company-wide transparency can even be used to improve customer services. You should value your customers and clients as they’re the ones that are keeping your business alive. Encourage staff to own their mistakes and dedicate their time to ensuring those problems are sorted. Keep clients and customers in the loop and try to avoid letting them get passed around from department to department. If staff aren’t afraid that they’ll say the wrong thing to a customer, they’re more likely to be open about the problem or mistake and a solution may be found much quicker.

It is understandable that some will be cautious when it comes to sharing the ins and outs of their businesses. Nobody is saying that you should reveal all your trade secrets, but celebrating inclusivity and openness promotes a healthy and positive working environment for you, your staff, and your clients, and may serve you very well in the long term.

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