Money Talks: How To Communicate Pay Decisions
Transparency in pay systems and decision making leads to more equitable pay and more trust from employees. It’s been shown to increase employee engagement and productivity, and the number of applicants for open jobs. Learn more about pay transparency and completing a pay equity audit through our digital course Cultivating Equitable Compensation. This 4-week interactive course will teach you what you need to know.
Knowing this, the question becomes:
How do we communicate more transparent pay when the system and decisions have been secret in the past?
Here are 3 steps that make communicating pay decisions easier and smoother.
1. Start with small changes
When moving from very little pay transparency to some or even full transparency, introduce the change gradually.
Payscale’s Pay Transparency Spectrum shows the different stages of pay transparency beginning with the basics (What) and progressing to full transparency (Wow). Moving from What straight to Wow is too rapid of a change all at once, and can provide a culture shock to employees.
Start by sharing pay bands for specific roles or groups of roles. For example, if job responsibilities and duties are similar, you can group all coordinator roles together and create a pay band. You can then share pay bands with the whole company, or just the position and manager that they apply to.
Another first step option is to share salary bands for a specific position only with the person in the role. This can be a stepping stone to sharing the information with the whole department or company at a later time.
2. Train your managers
Managers should feel as comfortable talking about pay as the HR and compensation teams.
When training managers be sure to discuss:
The proper language around pay and what it means
The company’s values and pay philosophy (this of course must be defined first)
What is transparent and what is confidential
Laws around pay
Then role play scenarios with managers to go over potential questions that often come up.
Questions like:
Why does Jamie get paid more than me?
Why don’t I get a raise?
Why don’t I make the top of the range?
3. Communicate in multiple ways
Over-communication is key. Most people need to hear something multiple times to get the full message.
If you communicate via an all hands meeting (a great way to communicate pay decisions because it reaches a large percentage of the company at once), be sure there is a recording for those who missed it or want to revisit the information again. In addition, include a follow-up email with a bulleted summary and slide deck for those who won’t take the time to watch the recording. If your company uses an instant messaging system, also send an IM linking to a folder that contains the video, slide deck, and a memo with the bulleted list.
This may feel like a lot but as a general rule people need to hear something 3 times to really remember it. People also learn in different ways, so having the information in a variety of formats and sending it a few times will help to reach as many people as possible.
Communicating pay strategy can be a sensitive topic, people will only get more comfortable by doing it. If you need assistance creating or communicating your pay info reach out to WorkVision Consulting to set up a free discovery call at info@workvisionconsulting.com.
