Émilie Pelletier welcomes Stepan Arman, Senior Director of Sales at Indeed Quebec, in this new episode of Vecteur H, the program dedicated to HR issues broadcast in partnership with Isarta. The opportunity to discuss the growing trend of salary transparency.
The craze around salary transparency is not decreasing lately. For several reasons, according to Stepan Arman. On the one hand, there is a generational trend: younger generations are demanding more transparency in their job search, including in terms of compensation.
On the other hand, transparency remains the primary tool to fight salary inequity, especially between men and women,” he adds.
A generalized movement
According to the figures mentioned by Stepan Arman, 75% of Canadians will not apply for a job that does not contain salary information. In fact, 63% of those surveyed by his firm say that salary should be clearly stated in a job offer (a figure that peaks at 68% among women).
This trend is far from unique to Canada. More and more local or national jurisdictions around the world are establishing specific laws (or openly considering them) to encourage or even impose salary transparency: the city of New York, the American states of Washington, Colorado or California, the European Union. Not to mention Prince Edward Island, closer to home.
A multifaceted concept
But what do we ultimately mean by “salary transparency?” First, we need to understand the term:
- At the employee level – by having an open mind and willingness to openly discuss compensation in the broadest sense (salary, variable bonuses, shares etc.)
- At the corporate culture level – by creating an environment of transparency that allows everyone in the company to share this type of information without fear of retribution or negative impact.
Second, there are different levels of transparency. It is all a question of nuance. We speak of transparency :
- partial: when salary is mentioned only at the job posting level
- second level: when salary ranges are shared internally and allow employees to position themselves on the grid according to their skills, experience and job
- Complete: when everyone knows, to the dollar, the compensation level for a given position
Transparency is a business decision, often driven by HR, insists Stepan Arman. It implies a global transparency for the company”.
Advantages… but also points of vigilance
There are many advantages. For the employer, it is already a factor of attraction and retention. It feeds the employer brand and sends specific signals about the company’s culture. According to Stepan Aman, job postings that include compensation information can generate up to 90% more applications! In addition, it makes for a more efficient recruitment process: applicants apply with full knowledge of the facts.
In other words, there is no risk of wasting time on a hiring process if, from the outset, the financial conditions offered by the company are not compatible with the candidates’ requirements.
This is bad for the experience and candidates will lose confidence in the company and will not apply there in the future, even if they see interesting new offers,” says Arman.
As always, however, there are some nuances to this rosy picture. There is also a downside to salary transparency: employers lose some leeway to negotiate based on the background or experience of applicants. As Shawn Johal explained in a previous episode, setting a range means taking the risk of losing people who are above it and could have justified making an extra effort because of their added value.
Another difficulty is the general discomfort of talking about salary. Salary is still a taboo subject in Canada. Some employers are reluctant to take the plunge so as not to make their teams uncomfortable, knowing that 36% of Canadians feel comfortable negotiating their salary… but 31% have never discussed salary in their company!
A good practice? Simply survey employees to find out what they want and make the compensation process more democratic. Furthermore, highlighting salaries on job postings should not exempt companies from highlighting other benefits offered (so as not to attract people interested only in money).
Transparency remains a question of balance.
