It’s inevitable; employees will interact with each other, form strong bonds as well as compare themselves to others. They will have conversations about what makes them happy as well as other topics that are on their minds. When it comes to salary, they will want to know what their coworkers are making. Though a lot of companies have tried to place a ban on employees who try to discuss their salary. Overall, employers cannot prohibit or ban their employees from discussing their wages regardless of the state within the US they reside in.

The National Labor Relations Act (NLRA) under section 8(a)(1) states it is unfair labor practice for an employer to interfere with the rights guaranteed in Section 7 which grants employees the right to engage in “protected concerted activity.” Numerous lawsuits have been filed by former employees who had been fired for discussing salary and won. It’s also unlawful for employers to punish or retaliate against employees who talk about their salary.

How should you handle this issue? Would allowing employees to share details about their income help build a culture of trust? Will it cause others to step forward and demand more? Or will you lose some of your top talent because they’re not being paid enough? Why is it anyone’s business how much you decide to pay one employee over the other?

While there isn’t a definitive answer to any of those questions; it is important to establish a transparent culture, which includes allowing employees to discuss their salaries. This promotes fairness, trust, and equity in the workplace which is what a lot of companies are striving towards. Hindering speech and hiding information is a sure way to demonstrate how the organization is moving in a negative direction. Plus, it shows that a company is aware of the pay disparities among their staff and they prefer to keep that information quiet.

Still a little nervous about allowing employees to talk about their wages? Here are some steps to take in preparation for the big change:

Update The Job Titles and Job Descriptions

Set aside some time to revisit the existing job descriptions and titles to assure they match. It’s important for employees to have an updated job description so they understand what their duties are. Often times employees will be performing duties that are not a part of their job description which could mean they are misclassified or belong to a different salary scale, which leads to the next point….

Update The Classifications

Depending on the type of work your employees are doing and the associated salary; they may be classified as exempt or non-exempt. The Fair Labor Standards Act (FLSA) has established guidelines to help you determine the proper classification for your employees because it’s easy to misclassify some employees who are performing managerial duties but considered non-managerial. So carve out some time to re-evaluate.

Update The Salary Scales

Once your employees are properly classified and they have the correct job title; you can revisit your existing salary scales and ensure alignment with the job titles, departments, and locations. You can start with the positions that have long term staff members in need of a salary increase. There are various tools out there that can be used as a reference for salary, cost of living, and market information to assure your wages are up to speed with the market like Salary.com, Glassdoor and Payscale.

Post Salary Ranges On Job Ads

Various states have already rolled out pay transparency laws that require salary ranges to be posted. So double-check your state to assure your company is abiding by the law. It may be tough especially if your salary scales have not been evaluated in a while, or in the middle of terminating an employee. But revisit the salary scales and get those up to speed, especially for the roles that you will be hiring for in the near future.

Do Not Discourage Employee Interactions

The biggest you may have is getting exposed, causing unrest, and ultimately losing employees due to those open salary communications. However, once the salary ranges have been updated and the employees are classified properly, there shouldn’t be a cause for concern. Also, understand the employees have the right to NOT share their private information because they have made their own career choices and have financial obligations outside of work so they are less likely to share. The NLRA is cracking down on employers who retaliate and terminate employees who chose to talk about their salary, so tread lightly.

At the end of the day, the employees have choices, whether they chose to engage in salary-related conversations or not. There are advantages and disadvantages associated with pay transparency, but if you consider the suggestions covered in this article; rest assured your the issues will be minimal. There will be less jealousy and conflict in the workplace because everyone will understand the structure of their pay rates.

If you need assistance with figuring out how to get some security measures in place, feel free to schedule a free consultation or give us a call at Orbis Human Capital.