Salary-related conversations have long been taboo in the business world. Asking questions about pay is discouraged by companies, and considered rude by most people.
Although salary secrecy continues to be the most prevalent payment model among companies, in recent years many digital marketing agencies have decided to adopt more honest compensation policies. These transparent approaches have proven to improve performance, enhance trust, and encourage equity in the workplace.
Salary transparency essentially consists of revealing employees the amount of pay that everyone in the workplace receives. Here are three benefits of having a pay transparency approach in your agency:
Keeps Your Team Members Informed
Keeping your team members informed about their wages, industry standards, and similar companies’ salaries, can help them feel more comfortable and satisfied with how much they earn.
In recent years, emerging employer review sites like Glassdoor have made it easier for employees to learn about average salaries within different industries, positions, and experience levels. The success of these websites reveals the relevance that salary information has for employees throughout the country.
Salary secrecy is so embedded in our business culture that most employees don’t even have a notion of how fairly they are being paid in relation to the market rate. According to an article published by the Harvard Business Review, 64% of workers who have salaries in the market pay range describe themselves as underpaid.
These assumptions often keep employees unmotivated and unhappy. Being transparent about salary can help your team have a better understanding of your compensation system.
Simplifies Hiring Processes
A wage transparency approach can also make your recruiting and hiring processes easier.
When new hires have access to the wage information of everyone at the workplace, they can visualize their potential growth path in the company. New employees might feel satisfied with a lower initial salary if there are visible promotional opportunities within the organization.
Honest and transparent communication is the basis of any successful working relationship. Companies that have a salary secrecy approach, tend to discourage their team members from sharing any type of detail regarding compensation.
When there is a poor understanding of the compensation structure in the workplace, wages tend to be a reason for gossip. These assumptions and salary comparisons can create tension and resentment among team members.
When it comes to building a healthy working environment in an agency, being authentic is a must. Salary transparency makes everyone in the workplace feel more valued and comfortable. In addition, it makes it easier for team members to communicate with their leaders and fellow peers.
If your agency stands strong for equity, salary transparency can help your workplace become more diverse, equitable, and inclusive.
Although salary transparency can’t tackle down racial and gender disparities on its own, it can increase fairness in the workplace when applied with other regulations. Equal pay audits along with rate adjustments and wage transparency can help address unconscious racial and gender biases in a company.
Women’s median wages tend to be lower than men’s in nearly all occupations. A report published by Census Bureau shows that women make 80 cents for every dollar earned by a man. Wage gaps are even worse for black women, who earn 61 cents for every dollar that their male counterparts are paid.
According to a fact sheet published by the Women’s Bureau, more than half of all employers in the U.S. enforce formal and informal salary secrecy policies in their workplace. These policies can help perpetuate gender and race pay discrepancies. Having transparent salary structures will let employees know whether they are being paid fairly, or not.
Implementing Transparency In Your Agency
If equity and trust are among your agency’s core values, then you should consider applying a transparent payment model that keeps your team informed and motivated.
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