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Improves trust with employees.

Improves understanding in how pay levels are set.

.Employees who want to advance their career are motivated to work harder to achieve senior salary levers for themselves.

Irene W.

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An employee might sue the company for sharing private information about their salary.

It can lead to some employees feeling underpaid and undervalued.

It could negatively affect engagement with colleagues and work in general.

Irene W.

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- anonymous average salary ranges provides a benchmark, also useful for newcomers to the organization.
- when the salary ranges are transparent, an individual does not need to "fight" as hard to negotiate their salary in fear of being payed the minimum. It increases (or at least doesn't decrease) trust in the organization.
Murat

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- has the potential to cause jealousy amongst peers and even lead to rumors circulating about how person A gets this much money, but look at the mistakes they make in the Balance Sheet forecasts, etc.
- if there's a perceived injustice in the salary compared to a peer, motivation can drop and relationships with manager can deteriorate.
Murat

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Anonymous salary ranges are helpful in the sense that they provide benchmarks, set goals and simplify negotiations for those progressing within the organisation. This can help for both new joiners and established employees.

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I see most downsides would be associated with non-anonymous, and peer-level transparency.

If I know the salaries of my peers, I could easily conclude that there is nothing I can do to earn what they are, as it seems to be either experience-based or random, and this could quickly lead to disengagement.

If I know the salaries of named bosses, the personal element could come to the fore, and detract from the goal of motivating. For example, if I don't like, or am jealous of, a manager, I could rationalise that the faults which I perceive them to have make them unfit for the salary, at which point my focus has turned away from the role, and the road to get there.

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People don't have the feeling of being paid worse then other people doing the same job. (In case of equal and fair salaries).
In consequence, it is easier to negotiate with employees about raises and how performance is tied to a salary.
-ralph

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Can and will cause a lot of stress on the system as a company and team dynamics if there are not fair salaries in place.

-Ralph

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If a salary distribution is provided, and knowing people tend to overestimate the results of their efforts, most of them would think that they should be on the right corner of the distribution. And if not, they will be unsatisfied or even feel miserable. On the other hand, if someone is already in that corner and the teammates get to know that he/she earns more, envy will play its role.
-Emilio de Paz

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Adding transparency to the salary policy of the company adds fairness to the process of negotiating salaries between the employee and the company as both parties will have that information.

Borja

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By knowing this information, there is a risk that employees might feel underpaid in comparission with other pears which they might perceive to work less hard than them.

- Borja

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Employees and employers spent less energy and time on negotiations.

Employees may perceive more equity and less biases.

- Ju Du

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Competitors, especially in an oligopoly market, could use salary transparency to attract talents .

- Ju Du

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- helps remove discrimatory pay gaps from organisations.
- fairer pay structures i.e. equal pay for the same work.
- eliminates distrust and suspicion amongst co-workers about salaries
Niall

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- removes control over negotiation of salaries to attract or reward valuable individuals
- employees can easily compare their salaries or potential salaries and may negotiate better pay in another organisation and leave.

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Peers may be overthinking inequality in terms of pay, if they find out someone else is being paid much more. This can lead some to being jealous, and team work ineffective as a result.
Karolina

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I believe horizontal inequality is often wrongly perceived as there always are team members with different experiences, backgrounds, years of service, and responsibilities......In modern times, there is also people with different stories. E.g. one team member that had been downgraded from his/her previous role, and that came from a company that the enterprise acquired some years ago, definitely has a different benchmark and basis for his/her salary

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Salary transparency can  make the process seem more fair to employees (provided it is actually fair).
Salary Transparency can motivate employees by giving them extra incentive to go for a high paying promotion.

-Joel

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If the salaries are not equitable at their level, an employee may feel demotivated by their coworkers high salaries.

It may prompt an employee to look for another job if they see that they are paid less than their counterparts or if they do not get the promotion/raise that they really want

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Salary transparency would reveal "unfair" or even illegal discrepancies in remuneration, e.g. gender pay gap.

If differences in payment are deemed equitable, it will increase trust in the company.

As we've read, a certain level of transparency can motivate employees to improve performance.

At the very least, it will help decide who should pay for drinks...

-Jack

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Many of the benefits of non-anonymous salary transparency might be achieved by anonymous salary transparency or even just a very clear pay structure. These policies would avoid some of the drawbacks of full transparency, e.g.:

Perceived horizonal inequity leading to less productivity and other negative outcomes

Damage to interpersonal relations

General feelings of a lack of distributive (as well as procedural) justice in the organization.

-Jack

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Salary transparency encourages fair treatment of all employees, and gives employees a sense of equity. It allows systematically linking salaries with positions, also creating transparency in the salary evolution with career progression.

(Salaries at my company are according to a union tariff system (IG Metall). Each position must be classified according to tariff grading, which determines the salary range for that job. It's somewhat transparent - people will not know the exact salary of someone else, but the range in which the salary lies.)
George

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Full salary transparency will require a very robust system of linking salary to job grading and performance, because it will create constant pressure on management and HR to justify why person A has gotten a salary increase relative to person B. If management cannot explain, it will create feelings of inequity and dissatisfaction.
George

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Transparency can show trust and provide a sense of fairness. But figure, it will also create a lot of discussion about fairness among colleagues. I mean, even if you have similar position, who is staying latest? who is the best talent, why are I less valued then someone else.. Etc

Even if I am curious about some of my peers salary, I think I rather stay unaware and happy :)  //emil

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Enables transparency
Eliminates gender gap pay
Eliminates discrimination
Provides a benchmark
(Justina)

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May provoke jealousy amongst peers
May increase competition
Eliminates negotiation process
(Justina)

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Perceived fairness because it will probably only be shared when it is fair.

Employees are not putting time in trying to figure out what colleagues earn or what they will earn in their next career step (as it is widely known).

It is a motivation to know what a next career steps means financially.

Jordi de Ruiter

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Employees start to compare their efforts and outcomes to other colleagues in detail to assess the salary differences (perceived unfairness as a result).

Collaboration can get worse when peers are envy or jealous of each other for salary differences.

Jordi de Ruiter

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The advantages for the employee:
- Removing the wage gap among the employees in the same position
- Fewer efforts & time spent on negotiations
- Less exploitation of workers
- Better impression for what to expect for the position and also the next step

The advantages for the employer:
- More trust of the employee
- Higher control of salary negotiation/promotion narrative
- Attract wider pool of the quality talents

(Somyi Wagner-Park)

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The disadvantages for the employee:
- Might bring less recognition of the employee performance
- Might bring a privacy issue & jealousy to see the employee in the different positions

The disadvantages for the employer:
- Might pay unnecessarily higher salary which could save the cost through a negotiation
- Might need to apply governmental regulation > more administrative work for the employer
- Might not attract the "star" talent to the position as they know that their additional miles will be not rewarded in the structure

(Somyi Wagner-Park)

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1): It develops trust in management
2): Improves Feeling of Fairness and equity.
3): Improves Belongingness.
4): Helps eliminate confusions
5): Improves Satisfaction
Asif Sardar

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1): Cultiave demotivation and negativity if the Salaries are not balanced.
2): Develops Comparison and Jealousy
3): Foster feeling of mistreatment, unfairness, and inequity

Asif sardar

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It can serve as a trigger point for staff to work harder.
It can also create a glimpse of their future to determine if the salary aligns with their financial goals.

Mayowa

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It could cause a rift amongst the same team members and further be infringing on the rights of the staff if it wasn't clearly stated that they would display it.
Mayowa

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- Benchmarking for roles
- No/less bias in pay based on gender, appearance, etc.
- Perceived fairness in same roles
- Advantage for loyal employees (who usually earn less when staying with a company compared to people moving between companies for higher salary)

Taner

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If rationale/reason for differences in salaries among peers is not obvious or explained this can/will cause dissatisfaction and impair motivation as well as collaboration.
Also, salary differences between different levels need to be explained to increase motivatiation for next step or at least not dissatisfy in current role.

Taner

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It would create environment of trust, if the process for deciding the salary is transparent. - Bimalendu

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If the process for deciding the salary is not transparent then it may lead to dissatisfaction.

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I agree with the article that the transparency should be anonymous.
Advantages are:
1. You feel treated fairly
2. Can increase motivation to do better
3. Less competition with colleagues, can enhance teamwork

Pia

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can increase dissatisfaction if you know how much the next level/management is earning and you know you are happy with where you are.

Pia

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Fairness
Open competition

Shaofang

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- It can still be hard to justify the different salaries. E.g., is different tenure a sufficient reason for discrepant compensations when two employees do the same job?
- It may be hard to lure or attract ambitious candidates.

Shaofang

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*Advantages:*
-Increase productivity -motivates subordinates to work harder because they understand the future will be bright after all.

-Salary transparency will expose organizational injustice among employees which will make companies, strive to create a standardization in salary policy across all boards.

Disadvantages:
-Company will pay more because of disenchantment among workers which may lead to confrontation against HR and its salary policy

-Transparency will expose the salary disparity among peers which will create unhealthy competition.

-Some managers will find out about their subordinates who earn almost as well as them and begin to see them as a threat or competitor in team which may lead to unfair treatment. Thus, giving rise to antagonism/demoralization on the part of managers.

Kizito A.

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I think the main advantage of salary transparency is that it empowers employees. Whether that empowerment is then used in ways that will benefit productivity or not is another questions. As the article discussed (... and I have seen first hand), when your co-workers know how much your salary is, it can lead to some very demotivating behaviour. However, that is the choice of each employees to make or to not make. Allowing them the power to choose is the right thing to do.

-Patrick

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I believe the main disadvantage to employee salary transparency is that it has the potential to disrupt productivity depending on the employee. I have seen first hand how demotivating it can be to learn about a coworker's salary, especially if it someone who does the same job as you and are being paid quite a bit more. This has the potential to cause employees to disengage entirely for a period of time and even has the potential for some to quit or to seek work elsewhere.

-Patrick

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If - as the article suggests - you publish averages as well as potential max deviations from these averages, you may achieve: (1) A motivation for staff to aspire the next career step (2) Less fear that peers earn much more because they may have negotiated smarter

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Full transparency can create a lot of turmoil, as people may fear that very private informaiton is compromised. The article therefore suggests to use averages (or perhaps salary bands per level). With this approach you may still encouter two issues: (1) If you acually have a problem with great imbalances, you should fix it before such a step, otherwise there may be an outcry. (2) Of course you deprive yourself to use salary differences as a tool - say you need to hire an expert whom you cannot get if you do not pay more than average.

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Gender pay gap

To me one major advantage of salary transparency is to prevent gender pay gaps. In our company we don`t have full salary transparency but we know how positions are graded and we know the ranges of each grading. So if I want to make a salary jump, I know for which positions I need to apply.

Margarete N.

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Salary transparency on their manager salary :

- encourages employees to work more
- reassures employees about the capabilities of the company

Salary transparency on their peers salary :
- reassure employees about fairness and social justice within the company

Laetissia

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Salary transparency :
- brings bad competition among employees
- causes jealousy and strife
- demotivates employees who are paid less and feel exploited
- creates a feeling of injustice in the hearts

Laetissia

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Fairness with all the stakeholders.
Save time from unproductive arguments.

Alassane

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Exposition to the competition
difficulties to keep the workers when they are less paid than others in the same position and level of responsabilities.

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Salary Transparency Need to be Circumstantial

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Salary Transparency Need to be Circumstantial

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- Revealing salaries of each grade provides every employee with a target to work towards thus additional motivation.

- It would be helpful to reveal salaries among team members only if salaries were the same, and collaborated team achievements led to salary increases for all.

Ryan

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- By revealing salaries for each job grade, the amount of salary increase needs to be substantial enough or it would have an adverse effect on motivation.

- Revealing salaries of peer employees would lead to resentments and bitter competition among employees if there are differences, minor or large.

Ryan

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If you're at the bottom of the salary range, you can look at other people's salary and model your behaviour and actions to achieve the same salary.

It is also less likely that people feel the need to have conversations about salary.

David Eberhard

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If you know someone's getting paid more than you but also does half the work it can lead to conflict and/or disengagement. It also means that you can see the highest salary for your job or the job you're gunning for and if it is not what you expect you may look elsewhere.

David Eberhard

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It can secure your feelings that you are not alone in the same struggle for higher salary.
Or you may appreciate the transparency on the standards of salaries.

Martine EDAKEDI

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If people under your supervision or where you have the same duties and responsibilities , but  there are inequalities in the salaries, you will surely be demotivated.

Martine EDAKEDI

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People always think they work hard and never understand others commitment and hard work. They will never compare with people below but with people above in terms of salary. This only creates a culture of demotivation
-Sharang

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People will be inspired by their peers and bosses salary. They will introspect and seek improvement in themselves in order to achieve the same stature.

-Sharang

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Whatever benefits of full transparency are outweighed by the disadvantages in my opinion. Team flow and cohesion is a tough thing to establish and get going seamlessly and I would struggle to jeopardize that with taking the chance that one or two people have a very negative reaction. I also feel that 90 percent of those inclined to be motivated by the knowledge were most likely already driven in some ways. In the creative industry where work can be highly subjective, I see employees who feel their design is the GOAT but the rest of the team feels the opposite and full transparency would be tough to manage

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+Motivation
+Fairness
+time savings

-Mark Irvir

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-Propensity of people to demand more versus with what they are actually giving

-Mark Irvir

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with a clear pay structure, open salaries give employees numbers to aspire to and brings motivation

Cat