How Is Pay Transparency Affecting Businesses and Employees?

How are workers responding to pay transparency?

As a business owner, are you concerned about pay transparency affecting businesses, especially with new hires?

Based on new laws, companies are now in the position of having to post salary ranges. However, co-workers who discover the job listing has a higher range than what they are making are typically not happy about it. Employees ask employers about the discrepancy. Yet the employer has to fill the position, which means being competitive with current market rates. Many employers explain this fact, saying there is nothing they can do.

The combined effects of pay transparency and inflation on the job market

According to The Baharat Express News , a survey done by SHRM (Society or Human Resources Management) professionals showed that 36% of the 1300 professionals surveyed asked their employers for raises.

Younger employees are apt to leave their jobs when they discover their pay is much lower than the advertised salary.

This opens a cyclical problem for employers: an employee leaves to find a job elsewhere. The employer has to hire a person to replace the employee who left. The new hire receives a higher payrate. The job turnover rate increases. Would the employer be better off giving his employees raises? Perhaps not, if only the turnover rate is only 36%.

According to the U.S. Bureau of Labor, wages and salaries for U.S. workers increased 5.1% for the 12 month period ending in 2022. Wages and salaries had already increased 4.5 percent for the 12-month period ending in December 2021.

Is pay transparency driving up inflation even higher?

As an employer, do you need legal assistance with wage and hour issues?

If you are a company owner and have questions or concerns about labor or wage and hour matters, an experienced employment law defense attorney can help. Whenever possible, it is wise to do so before legal issues arise. Call (718) 275-6500 to arrange an appointment with Stephen D. Hans & Associates, P.C.