But 1 in 4 leaders unconvinced of merits of pay transparency: survey
The number of companies that are being transparent on pay offers in job postings has more than doubled over the past year, according to a new report.
Payscale's 2023 Compensation Best Practices Report revealed that 45% of companies now include pay ranges in job postings in 2022, up from the previous 22% the previous year.
The findings revealed that 27% of these organisations reveal a vacant role's job posting regardless of whether it is mandated by law. For 18%, they said they only publish in a job posting when required by law.
Other organisations, on the other hand, reveal the pay rangers at a later stage of recruitment such as:
Some 13% of employers do not share the pay range with employees, according to Payscale, but this is down from 24% recorded the previous year.
The most common obstruction to pay transparency is not having organised pay structures (33%), according to the report. Other reasons include:
"The overall takeaway is that most [employers] do not appear to be ready for pay transparency laws," the report said. "However, adopting pay transparency is a best practice, regardless of the law — especially as remote work becomes more common and published pay rangers become increasingly expected by job seekers."
Bigger corporations have already taken steps to enhance pay transparency in their workplaces, such as Microsoft, which began disclosing salary ranges for internal and external job postings in the US this year.
Payscale's 2023 Compensation Best Practices Report, which gathered a total 4,933 responses across the world, also revealed that the number employers planning to raise their base pay this year declined to 80% from 87%.
Payscale's latest findings come as more transparency-related legislation is being created by lawmakers.
In California, the state government mandates all employers with at least 15 workers to include the hourly rate or salary range on job listings and provide pay scale to employees upon request.
For organisations, the recent pay transparency legislation made them improve their pay data, pay structure, and pay equity (37%), according to the report.
Another 11% said they are investing in equitable pay structures for the first time, while 11% said they "resisting pay transparency."
Similar legislation being proposed in more locations will likely expand the pay transparency trend, according to Ruth Thomas, pay equity strategist at Payscale.
"This is great news as pay transparency has been shown to help close the gender pay gap. In order to publish pay ranges with confidence, organisations first need to take on internal pay equity," Thomas said in a media release.
