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For most of my career, “salary transparency” was not a phrase you’d hear around the workplace.
But times are changing, and for good reason. We’re finally starting to realize that this hush-hush approach to salaries isn’t doing anyone any favors, except maybe employers who aren’t keen on fair pay practices.
This shift is especially crucial for those entering the job market or early in their careers. One of the things we know about GenZ in the workplace is that they value authenticity and transparency, which is driving companies to be more transparent about payscales. (Thank you, Gen Z!)
All that being said, there are still many misconceptions, and plenty of misinformation, about salary transparency. So in this article, we’ll answer all your FAQs and show you how you can go about discussing pay at work without burning any career bridges.
Is it legal to discuss pay at work?
In the United States, federal employees and employees in certain states are protected from discrimination for discussing pay at work. But when it comes to non-government workers, the answer is more complicated.
In 2016, the U.S. Labor Department finalized Executive Order 1124, a law that made it illegal to discriminate against federal employees for discussing pay at work. This included businesses that have at least one federal employee, or any businesses using federal contractors.
Rulings from the U.S. Labor Department are often seen as guidance for private businesses and states, but the federal government can’t mandate the same rulings to non-federal employees.
However, many states have implemented salary protection laws for state employees, and in some cases, private businesses.
As of September 2024, there are 10 states that have pay transparency laws on the books:
- California
- Colorado
- Connecticut
- Hawaii
- Illinois
- Maryland
- Nevada
- New York
- Rhode Island
- Washington
Each of these states has slightly different rules, but in most cases, their salary transparency laws protect workers who talk about pay at work by charging employers hefty fines for violations.
There are several states that are considering new salary transparency laws—it may be that you have a chance to vote on it in your state in upcoming elections. There are also certain cities and towns, like Cincinati and Toledo, that have pay transparency laws in place, despite being in states that don’t mandate it.
It’s pretty complicated! The best way to know whether you’re protected at work is to look up the laws on your state website. And if you find you’re in a state where it’s not offered, then it’s time to register to vote, so you can effect change in the future.
Do companies have to provide pay rates in job listings?
One of the most frustrating aspects of applying for a job is going through the interview process without knowing whether the compensation is going to be worth it in the end.
Fortunately, many of the states listed above also have laws regarding this factor. In some cases, they require employers to list salary or hourly rates as well as the benefits provided on all job listings.
However, in states without pay transparency laws, employers can unfortunately get away without sharing salary figures until much later in the hiring process.
Whether or not there are laws in place where you live, pay transparency is important. Let’s look at a few reasons why it should factor into your job search.
The benefits of pay transparency
For workers and employers alike, pay transparency is a good thing. Employers who offer pay transparency stand to attract the best talent, giving themselves leverage over their competitors.
For workers, there are multiple benefits of pay transparency that make it worth seeking out jobs that disclose salary upfront.
Pay transparency promotes equality
In an ideal world, people would be paid based exclusively on the time they put in, the difficulty of their job, and the value their work brings to the employer.
But statistics show us that employers often discriminate when it comes to pay. The gender pay gap is still an enormous issue, with women earning on average 83% of what their male counterparts own as of 2024, according to AAUW.
It’s also harder for people of color, those living with disabilities, and members of the LGBTQ+ community to earn equal and fair pay.
Pay transparency helps solve this issue, at least partially, by making it impossible for employers to hide their unfair pay practices. Pay transparency does a much better job of leveling the playing field, so everyone gets a fair chance to earn and succeed.
Pay transparency increases trust and cohesion
When companies are open about their pay practices, it builds a foundation of trust between employers and employees. This openness leads to a more positive and productive work environment.
Secrecy around salaries, on the other hand, breeds suspicion and resentment among coworkers. People may wonder if they’re being paid fairly compared to their peers, which can quickly create a very toxic work environment.
With pay transparency, these doubts are eliminated. Everyone knows where they stand, reducing the need for vitriolic workplace gossip and speculation about who earns what.
This clarity in turn improves team dynamics and collaboration. When employees aren’t worried about hidden pay disparities, they can focus more on their work and less on comparing themselves to others.
Transparent pay practices also demonstrate that a company values fairness and equity. This can increase employee loyalty and job satisfaction, as workers feel more respected and valued.
For job seekers, a company that offers pay transparency signals that they have nothing to hide. It suggests a culture of openness that likely extends beyond just compensation.
Pay transparency makes applying for promotions easier
If you’re trying to move up in your company, salary transparency can be your secret weapon. It provides valuable information that can help you navigate your career path and make informed decisions about your next move.
With transparent pay structures, you can see exactly what you stand to gain from a promotion. This knowledge allows you to set clear career goals and understand what skills or achievements you need to reach the next level.
Pay transparency also takes a lot of the stress out pay negotiations. When you know the salary range for your current position and the one you’re aiming for, you’re in a much stronger position to advocate for yourself using negotiation strategies.
For instance, if you know that others in your role with similar experience are earning more, you have concrete data to back up your request for a raise. This takes some of the guesswork out of salary negotiations and can lead to fairer outcomes.
Moreover, transparent pay practices make it easier to spot opportunities for growth within your company. You can clearly see the financial benefits of taking on additional responsibilities or moving to a different department.
This openness can also encourage companies to create more structured promotion paths. When pay scales are public, employers are more likely to tie increases to specific achievements or skill sets, creating a clearer roadmap for advancement.
Why a lack of pay transparency is a red flag
We’ve covered the benefits of salary transparency, but consider this: Without pay transparency, all of those benefits disappear.
A lack of transparency can perpetuate pay inequalities. Without open information, it’s much easier for unfair pay practices based on gender, race, or other factors to go unnoticed and unchallenged. This secrecy can maintain systemic biases in compensation.
Opacity in pay practices can also cause distrust and resentment among employees. For those looking to advance their careers, a lack of pay transparency can make it difficult to set realistic goals or negotiate effectively.
In general, companies that shy away from pay transparency are signaling a broader culture of secrecy. This could extend to other areas of the business, potentially indicating a lack of open communication or employee empowerment. As a job seeker or current employee, a lack of salary transparency should give you pause, and perhaps even prompt you to wonder if it’s time to quit your job.
How to discuss salary during the job hiring process
Whenever you’re applying for a job, it’s vital that you start by reviewing the job description thoroughly. Hopefully, there will be clear information about the compensation—if so, you can hold off bringing it up until it’s clear you’re likely to get the job.
When it’s not evident on the description, then it’s up to you to bring it up, ideally early on in the process. An exception might be if you’re applying to a role at a dream company or for a position you really want—in these cases, you might be willing to wait on salary because the opportunity is so appealing.
In all other cases, you can tactfully ask about compensation when speaking with your primary contact, whether that’s a recruiter or someone within the business.
Your first questions shouldn’t be about compensation, but it’s appropriate to eventually say something like, “Would you be able to share the compensation range for this position with me?” If a company balks at a well-phrased question like that, that’s a red flag.
Before you ask, it’s a good idea to research market rates for the job you’re applying to. That way, you can have expectations in mind when you start this conversation.
Here are two resources for finding average wages for different roles:
- The Bureau of Labor Statistics lists up-to-date wages by industry
- Levels.fyi organizes salary info based on industry, role, location, etc.
And for more tips about navigating the job application process, check out these articles:
Talking about pay at work
Once you’re on the job, salary talk gets trickier; but it’s still important for ensuring fair compensation and career growth.
With coworkers, tread lightly. It’s your right to discuss pay, but not everyone’s comfortable with it. You don’t want to start asking people about pay when you’re new to the job, nor do you want your colleagues to see you as nosy or gossipy.
Build trust with your colleagues first. Get to know them and how they work, what their duties are, and what information they might be able to help you with. When you feel it’s time to ask, make sure you are clear about why you’re inquiring about pay. Something like this could work: “I’m trying to understand industry standards. Would you mind sharing your salary range?”
When it comes to management, timing is key. Performance reviews or discussions about new responsibilities are prime opportunities to talk about your pay. Come prepared with data on market rates and your contributions to the company.
When discussing pay with your management, it’s wise to focus on your value to the organization, not personal financial needs. Rather than simply asking for a pay raise, make a case using evidence of your hard work and successes, underscoring the value you’ve contributed to the company. Check out our article on managing up for more advice on interacting with management.
Above all else, when you’re talking about pay with colleagues or management, keep the conversation professional. Don’t bring up salaries at the work holiday party, for example, or in casual conversation outside of work hours. And if you choose to discuss pay in writing, assume that everything you write on business software or hardware—including emails, Slack, your company phone—can and will be read by your boss.
Talking about pay can be uncomfortable, but it’s crucial for advancing your career and making sure you’re being paid a fair wage. These conversations are much easier if you’ve done your research and prepared for the conversation. Keep it professional, but don’t let a company lead you on without being upfront about your earning potential. Instead, get comfortable asking about pay, and be part of this positive shift in the workplace.