Why pay transparency could work against you

Whether you’re starting out in your career, moving jobs or established in an organization, talking about pay has always been regarded as a taboo subject, especially among older generations.

In a study by Visier, 89% of Gen Z (people born between 1997 and 2012) are comfortable discussing their pay while this number drops to 53% for Baby Boomers (those born between 1946 and 1964).

And while you might think the 17 U.S. states that now have laws surrounding pay transparency are paving the way for a more inclusive and equal future, full disclosure is not always the best policy, especially when it comes to negotiating a new salary with your current or future employer.

That’s according to a study by Harvard Business School and Brown University. It found that salaries in states that protect an employee’s right to discuss pay fell by 2%, as employers were more reluctant to pay higher wages in order to avoid renegotiations with other staffers.

Then there’s the argument that pay transparency works against people of color and female employees as it gives a false sense of pay equality, and doesn’t address the issue of representation, or lack thereof, in more senior roles.

Despite publishing the names, titles and pay of every employee since 2012, the social media management platform Buffer is a good example of how this journey isn’t a linear one, either. The company took a full seven years to reduce its gender pay gap to less than 1%. And the way it did that was, in part, by widening it at some points.

“In 2019, our gap got worse before it got better. As we’ve reflected on this over the years, we believe this is because being a smaller company, each departure, and new hire, moves the number,” the company says. “In 2019 we hired more women who were in lower experience levels. As a result, we widened our gender pay gap, though we improved our overall gender ratio as a company, and we believe this paid off in the long-term.”

In 2019, male Buffer employees earned 15% more than female workers. Now, the divide between men and women in leadership roles has narrowed thanks to the company actively creating a career framework and adjusting its gender ratio so that 80% of its executive team is female.

The broken rung

Similarly, in data compiled by McKinsey and LeanIn.org for its eighth-annual Women In The Workplace report, a “broken rung” at the first step is holding women back from progressing up the career ladder at the same pace as men. For every 100 men who are promoted from entry level to manager, only 87 women or 82 women of color are promoted. The result is that men significantly outnumber women at manager level, and there are too few women to promote into senior leadership roles as they are always lagging behind.

The bottom line? Pay transparency can be a positive step in the right direction but it’s not conclusive, and closing the gender gap is a lot more nuanced than simply disclosing pay scales. To get a broader picture, look at the values of a company, how it leads, how it motivates its staff and its gender ratio policy as these factaors can provide a more rounded and realistic insight into a profitable career there.

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Data Engineering Manager, Ads, Netflix, Los Gatos

Working as part of the data engineering team, the Data Engineering Manager, Ads, is an innovative leader, with ad ecosystem experience, to drive the team’s evolution in a quickly evolving business. The successful candidate has an extensive background and strong technical expertise working with advertising data and understands how to build for scale, privacy, and business impact. You also have previous experience in building data systems from the ground up and enjoy working on hard problems with new tech. Find out more here.

Senior Product Manager, Learning, Duolingo, Pittsburg

Duolingo’s mission is to develop the best education in the world and make it universally available and the successful Senior Product Manager, Learning, will be tasked with driving strategy, product features through their entire creative cycle: ideation, specification, development, release, analysis, and iteration, perform qualitative and quantitative research to explore and validate feature ideas and work with engineers to help guide feature development. A Bachelor’s in engineering, computer science, math, design, psychology, or equivalent is required. See the full job spec here.

Software Engineer – Analytics, Coupa Software, San Mateo

Coupa Software is a leader in business spend management (BSM) and is now seeking a Software Engineer – Analytics. You’ll build and scale the reporting and analytical applications, enabling customers to optimize their spend, maximize savings, and operate efficiently. Plus, you will automate data loading processes, build monitoring tools around them, and engage with the operations team to deploy these to production systems. Interested? You’ll need a BS or higher in computer science, with three or more years’ experience building software with a data bias.

Familiarity with ETL/ELT using Spark or similar tools, like dbt, and strong analytical SQL skills are required. Get all the details here.

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