Wanna know how much I make?
August 9, 2006
The Chief Happiness Officer does. And he’s got good reason for wanting to know. Among other things, he thinks it might make salaries more fair, make it easier to retain the best employess and keep pressure on the highest earners to earn their keep.
The idea of open salaries is contentious. It’s throught provoking. It’s also downright brilliant. I’m a strong believer in the power of transparency to right wrongs, reduce red tape and eliminate waste –and I don’t see any reason why it wouldn’t work for salaries. Except one. it would require that employees be willing to accept their status in the corporation. For those at the bottom to understand that and be okay with being there.
To a certain extent, everyone knows their status already – people know how much they make and have a general idea of what others pull in. But to whatever extent they’ve justified those salaries to themselves, they would be forced, in this new world, to justify them to everyone else, too. “I’m okay with being worth $X.” That may just be too painful and demotivating to be productive for the organization.
The post is a rather fair dissection of both sides of the open/closed salaries argument – a worthy 5 minute read – even though we know which side wins.
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4 Responses to “Wanna know how much I make?”
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Federal and state government agencies don’t hide salary information–it’s public information and government employees are part of “public.”
Although in a government setting it is someone unsettling because with rigid, seniority-based pay scales–some employees might make a lot than others–no matter what their contribution.
The State of California actually publishes salaries of all the legislative staff working for state senators and state assembly persons once a year. Needless to say, this publication is a hot commodity as soon as it comes off the press.
Open compensation information is often a general policy sales, which is often the most demanding performance based culture within an organization. In many sales organizations each rep can literally view a dashboard that stack ranks their peers in terms of the major performance criteria. Reps tend to be on the same compensation plans that are functions of these criteria so any rep can look at another rep’s metrics and know their compensation. This can be used to benefit the sales force in general because all attention is immediately drawn to the individuals who are most effective. In a real performance oriented culture the most successful reps should be willing to share their tips and tactics with others. Of course everyone listens to the tips of the top reps.
If the most performance focused cultures and the most seniority oriented cultures already publish open salary information, all that’s left is to fill in the gaps. Doing so would increase recognition and performance across organizations.
Making the compensations public could generate a productive competition as long as the wages are fair and not preferential. It also can destabilize under certain condition and the competition wouldn’t be that productive for the company. I have nothing against the public wages but I don’t support them either excepting maybe the state officials and staff.
It’s often employees that object strongly to open information, rather than HR or senior management. Feedback seems to be that it’s personal information that shouldn’t be public rather than any longing to see what everyone else earns.