3 min

3 Helpful Tips to Practice Pay Transparency

Aug 25, 2022
in a nutshell
  • Do your research and take into account multiple data points on salaries being paid for your position.
  • Use that salary information to your advantage by vouching for a pay raise. Be prepared to present why you should get a pay increase though.
  • If you’re still unable to increase your salary then it might be time to start applying elsewhere.
Image of Pay transparency can actually work out for your benefit. Here are three helpful tips to help you practice pay transparency in the workplace.
in a nutshell
  • Do your research and take into account multiple data points on salaries being paid for your position.
  • Use that salary information to your advantage by vouching for a pay raise. Be prepared to present why you should get a pay increase though.
  • If you’re still unable to increase your salary then it might be time to start applying elsewhere.

There are certain topics you just don’t bring up at work. Discussions of religion, politics, and your burning hatred for your boss are all things that are better left out of meetings and off your company’s Slack channels.

For many workers, sharing the details of your compensation would also rank high on the list. But that may be changing. Some 42% of Gen Z employees (aged 18 to 25) and 40% of millennials (26 to 41) have shared salary information with a coworker or other professional contact, according to a survey from Bankrate. That compares with 31% of Gen Xers (42 to 57) and 19% of baby boomers (58 to 76) who said they’ve done the same.

“Younger workers are changing workplace taboos when it comes to talking about your salary,” Bankrate analyst Sarah Foster told Grow.

Given that millions of people are changing jobs amid rapidly rising consumer costs, an increase in salary transparency couldn’t come at a better time, she adds. “In light of how secretive companies can be about what they’re paying employees, it gives you the wherewithal to make sure you’re getting fairly paid.”

Here’s how experts recommend discussing salary information with coworkers and how they say you can use it to negotiate for better pay, whether you stay at your current company or not.

Take into account multiple data points when gathering information

Even though younger generations of workers are growing more open to the idea of discussing salary, it’s still a topic that should be handled with extreme care, says Monster career expert Vicki Salemi.

“You need to make sure that you’re talking confidentially and with someone you’ve built trust with,” she says. “There could be an imbalance if you reveal what you’re earning and your colleague doesn’t reveal what they make.”

Another possibility, especially given a hot job market: You may discover that a newer hire with less experience came in at a higher number than you’re currently earning. “Remember, they’re just the messenger,” Salemi says. “Don’t be resentful toward the person who told you this. Be grateful that you have this information.”

Knowing what other people in your company make is just one piece of the puzzle when understanding whether you’re paid fairly, points out Foster.

“There are websites, such as Glassdoor and PayScale, that provide workers with information about what people are making. But looking at those alone makes it hard to know what people in your position, your age group, and your experience level are making,” Foster says. “Talking about your salary can give you more tangible, specific dollar amounts to use when you go into the negotiation process.”

The more information you have to arm yourself with, the better, says Salemi. “Think about having multiple conversations with coworkers you trust and respect,” she says. “Don’t take one data point.”

Use salary information to your advantage

Say you find out that a coworker with less experience than you is earning a higher salary. The injustice of it all! Your instinct may be to barge into your boss’s office and say, “Steve is making $10,000 more than me — cough it up!”

Naturally, a little more tact will be required. Start by requesting some time on your boss’s calendar for a chat and begin preparing your talking points. The goal is to make it clear that you’d like a pay raise while outlining reasons (beyond “Look what Steve is making!”) you’ve become a more valuable member of the team from when you started.

“Your boss may need approvals [from other players in the company], so highlight your skills, achievements, and accomplishments,” says Salemi. “These can be the kinds of things that are in your annual review, and some things that aren’t. Maybe you’re really valuable for boosting morale among coworkers. Don’t be afraid to bring up things that ‘don’t show up in the box score.’”

Rather than naming a coworker by name or quoting their salary, you might say, ”‘It’s come to my attention that I’m paid less than my peers by X amount,’” says Salemi. ”‘How can we rectify this? I’ve been good at XYZ while I’ve been here. How can my salary be made whole?’ Allow for silence for your boss to respond.”

The next step may include applying elsewhere

If you and your boss are on the same page regarding your pay, great! That can make it easier to get other necessary parties, such as human resources, on board. If they’re wishy-washy, make plans to follow up, says Salemi.

“Ask about next steps. You may even want to set calendar reminders to follow up every two weeks.”

If the response is negative, you'll still have some valuable information at your disposal. Knowing what other employees at your position make gives you a leg up when searching for a new job — a process that you’d be wise to begin as soon as you receive the bad news.

“If the option is to stay here and get underpaid, you need to ask yourself if there is still a culture fit,” says Salemi. “You have to think, maybe I should start applying, setting up job alerts, and networking.”

If you’re looking for a bump in pay, you may have better luck looking outside your current gig. Data from the Federal Reserve Bank of Atlanta shows that, as of March 2022, employees who switch jobs see wage growth of 7.1% on average compared with a 5.3% growth rate among those who stay.

Knowing the going rate for the work you do could help you maximize your pay at your next gig, notes Foster, even if you’re not currently earning it. “I would caution job seekers against disclosing any salary history at all,” she says. “When a recruiter gives you a number, that becomes the floor. When you give a number, that becomes the ceiling.”

And no matter what happens, remember that having knowledge about salaries in your field gives you powerful tools for career growth going forward, says Salemi. “The fact that you’re having a conversation is a win,” she says. “Being in the dark means not knowing your worth. Once you have that information, now you have options.”

This material has been presented for informational and educational purposes only. The views expressed in the articles above are generalized and may not be appropriate for all investors. The information contained in this article should not be construed as, and may not be used in connection with, an offer to sell, or a solicitation of an offer to buy or hold, an interest in any security or investment product. There is no guarantee that past performance will recur or result in a positive outcome. Carefully consider your financial situation, including investment objective, time horizon, risk tolerance, and fees prior to making any investment decisions. No level of diversification or asset allocation can ensure profits or guarantee against losses. Article contributors are not affiliated with Acorns Advisers, LLC. and do not provide investment advice to Acorns’ clients. Acorns is not engaged in rendering tax, legal or accounting advice. Please consult a qualified professional for this type of service.

Ryan Ermey

Ryan Ermey was a senior reporter for Grow.

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