Should you let your employees know what the other employees are earning? Should you let them know what you’re earning?
When it comes to salary information, there are lots of opinions about whether to “open the books” or to clamp down and keep things private. Books have been written on this topic, and the subject is fascinating.
Feel free to take whatever approach you like, but you should know one thing with absolute certainty.
What should you know?
The employees in your office who want to know how much others are earning are going to find out. They will dig and dig and dig until they know what they want to know.
No matter how hard you try to lock down payroll information, they are going to defeat you. They will get the numbers one way or another. There is nothing you can do to stop them.
I can hear you now: “I can protect the data; I’ve been protecting it for years, and they haven’t accessed the numbers.” However, you are wrong. They have figured it out, if they care, and you’ve got at least a few employees who care.
How do they do it? They come across records left on the copier, they gain access to computer files you thought were locked down, they convince someone with access to spill the beans, or they just get together and tell one another the numbers. You can’t stop it, and you’re wasting your time, energy, and money if you work hard to put up a fight.
Should you actively disseminate the information to save them time so they can get back to work?
We don’t, but you might want to think about it as an option. They’re spending a bunch of your money digging around and strategizing about how to get the info they want.
In our firm, we assume that folks are going to find out one way or another (we’ve been right for 22 years), and we prepare ourselves to defend our decisions if someone gets out of sorts over something we’ve done. We think about the justification for our decisions before we lock ourselves into some change in salary. We ask ourselves whether what we’re doing is fair, whether it will make sense to others, and whether it’s going to throw our system out of whack.
Do we get it right? Do we make good decisions? Sometimes, but realistically, we’re just doing the best we can. It’s difficult to evaluate people, and it’s difficult to assign value to their work. Priorities change, and our needs shift over time as we adjust to circumstances. Deciding how much to pay each person is tricky, and thinking through the impact of those decisions is sometimes something we’re not very good at doing. There are lots of unintended consequences of our decisions.
Be prepared, no matter what decisions you make on payroll, for all of your employees to know what you did. There’s no hiding that information. The cat is out of the bag, and it’s going to stay out of the bag forever.
