Salary secrecy in “transparent” organisations

Organisations have, for decades, successfully convinced employees that they their salary packages must be guarded with the utmost secrecy – for their own protection. Are they right? Partially. Keeping your salary a secret protects you from the shock of discovering just how grossly underpaid you are.

Operating in countries where inequality gaps are steadily increasing, corporate organisations consciously feed into the continuation of those inequalities by not transforming their remuneration policies to ensure equal pay for equal work, and equity for employees who have historically been underpaid.

In most industries, there are salary benchmarks for jobs on every level. These benchmarks work as a guide for employers and employees to know what would constitute a fair salary for a role. However, these benchmarks are often ignored by employers during the recruitment process, and in many cases, candidates aren’t aware of the benchmarks for the role they are interviewing for, so they trust that prospective employers are operating in good faith.

Where does it go wrong?

A company’s culture and relationship with integrity is the key to determining how they approach issues that impact on equality and fairness. An organisation that is committed to transparency, transformation and equality will ensure that all employees who are recruited are given offers that fair and on par with their counterparts.

One of the biggest challenges job seekers are faced with in South Africa is interviewing for a job and being asked the dreaded, “Can we see your payslip?

This question is one of the biggest hurdles for job seekers, more so for job seekers who have a history of being underpaid because every new employer they join is unable to resist the lure of perpetuating the exploitative cycle instead of choosing integrity and equality.

The result is that the workforce is overflowing with underpaid employees who spend their entire careers unable to ever meaningfully improve their quality of life, afford to fully cover their expenses and responsibilities or have any money left over to save. These employees are, more often than not, Black.

A hopeful candidate who tries to resist being underpaid again is likely to be told that they should be appreciative for receiving an offer that is 8% higher than their current salary. Not taking into account the possibility that this may push them into a higher tax bracket and therefore increase the tax they must pay, and so they end up earning pretty much the same amount of money despite the step “up” the ladder.

In South Africa, we have legislation that stipulates that employees must be paid equally for equal work. In principle, this is a step in the direction. In practice, it falls flat because there is nobody who is actively checking on employers to ensure that they are following the rule of the law.

When employees try to take matters into their own hands and fight for equal pay, employers are so well insulated by the warmth of corporate inequality because employees battle to prove that their peers are earning more than them. Why? Employees are made to believe that the disclosure of salaries is an offense of sorts and must be guarded against at all costs.

And so, employees do everything that they can to guard this knowledge, to the benefit of the employer and the detriment of the employee.

Employees are always reminded about the importance of transparency, honesty and good faith when interacting with current/potential employers, but that is rarely reciprocated. Very few, if any, employers would disclose to a candidate how much their predecessor was paid and use that as a basis for salary negotiations.

We are starved of corporates who actually care about people and their wellbeing. We have a deficiency of employers who actually invest in improving the quality of life of their employees. And we lack the systems to begin to hold them accountable.

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