Salary Transparency Will be a Competitive Advantage for Companies who Commit to Doing it Well

For those of you familiar with the social platform Reddit, I follow a sub called “recruiting hell” regularly. The sub is exactly what it sounds like: applicants venting about company hiring processes, often in excruciating detail. The same themes come to the front time after time after time:

Companies’ hiring processes stink.

More to the point, companies communicate poorly, often dishonestly, and treat applicants like disposable assets.

Some of the stories are truly unbelievable. And though the themes do become repetitive over time, I continue to follow because it keeps me grounded as a talent acquisition professional.

One of those themes is of course, salary transparency. It’s become a hot topic as of late and plenty has been written and said as we watch transparency laws begin to take hold across the country. It presents an opening for employers to help applicants. But by all accounts, help is hard to come by. In fact, many companies are fighting salary transparency already. Recycled and unrealistic salary bands, and job postings that explicitly exclude applicants from states that have enacted salary transparency are just two of the trends that have begun to pop up. Add in dreadful AI technology on third-party posting boards that will estimate a posting range where the employer omits one, and you can begin to get a taste of applicants’ frustrations.

Out of all this though, there is opportunity.

Companies that can learn to embrace salary transparency will have a competitive recruiting advantage over those who don’t. Employers who continue to post sham job ranges, avoid honest salary discussions, and bait and switch candidates during the offer process are going to be exposed eventually. And though many of them may continue to be able to hire because they have deep pockets or blue chip branding, there are plenty of companies for which hiring is about to get even harder.

Here are three ways recruiters and employers can distinguish themselves using salary transparency:

1. Share the target salary range in the posting. Not a recycled range out of your payroll system. A realistic estimate of where a candidate can expect to be hired. Not a range with an 80k spread, a range with a 5k spread (maybe a bit more, depending on the level of the job.) It doesn’t matter if your company has five employees or 5,000; if you know what’s budgeted, and know where incumbent salaries fall within the existing band, you can post something realistic that will be informative to applicants. Not to mention, your posting will stand out in a sea of them where salary info is incomplete or unrealistic.

2. Share the target salary on the very first call with candidates. I am dumbfounded at how many recruiters don’t have a basic grasp of how to have this conversation with candidates. Offer a target figure (based on experience, budget and internal equity - which you will know if you’ve done your homework), and ask the candidate if that figure is in line with where they’ll need to be for their next role. Go 5% low if you’d like and then give yourself room to move upwards depending on candidate feedback. I do this all the time and it is remarkable how many candidates will reciprocate with salary info from their end, just because you were up front with them! Pro-actively offering this information takes pressure off the candidate to have to broach the conversation, and more importantly, positions yourself and your company as a hiring partner who is honest and trustworthy right out of the gate. On top of all that, you wont be wasting anyone’s time with a hiring process that falls apart at the end because the right salary conversations weren’t had at the outset.

3. Offer what you say you’re going to. Don’t bait and switch the candidate or lowball them just to pinch pennies. If you play your cards right in fact, you might actually be able to come in above the target salary that you initially discussed. These offers almost become a slam dunk for the company, and make it very hard for a candidate to say no to.

Finally, if the target salary isn’t in line with what a candidate needs, they’ll still remember that you were up front with them and took the time to have the right conversations. They’ll be ready to take your call when the next position comes around that may be a better fit for them.

It doesn’t take that much effort to be better than your competition. Salary transparency will provide some uncomfortable moments as companies try to change their thinking and communication around salary information. But remember that candidates want transparency and honesty. It’s in such short order right now that being open and honest with them right out of the gate is an easy way to make yourself someone that candidates want to work with, and your company a place they’ll want to call home.