The Price Isn’t Right

Older readers will remember the TV show the Price is Right where contestants competed to win prizes by guessing the price of merchandise.

My attention was caught by the weekly #HRHour Twitter chat on Friday this week that asked the question:

Do you advertise salary on positions or wait until candidates have made it to interview or offer stage?

I have written about this before and last time (8 years ago, where has the time gone?) it was probably one of my most commented on posts with both people for and against the idea of advertising salaries.  Since then?  Well, nothing much appears to have changed and it remains a bit of an irritation for me. 

I’m very much of the view that we should always advertise positions with a starting salary or range included. However, it’s not a concept New Zealand employers appear to want to embrace. Surely, it’s about transparency and not wasting yours or the candidates’ time.  Amazingly, the great majority of New Zealand candidates will apply for a position without asking what the role is paying.  Those that do have to make a phone call or send an email (assuming there is a point of contact on the job posting).  Have you ever been part of one of these cat and mouse phone/email conversations?

Candidate: I’m interested in what this role might be paying?

Employer: We offer a competitive package. It depends on the skills and experience of the person appointed?

Candidate: Can you give me a rough idea?

Employer: What are you looking for?

Candidate: Well, I’m currently earning $XX,XXX (exaggerates salary)

Employer: Yes, that’s in the ballpark. 

Candidate: So is the salary open to negotiation?

Employer: Possibly, but we also have to consider internal relativities.

And so this crazy dance goes on as everyone tiptoes around the issue. And why should I, as a job seeker, be expected to disclose my current salary?  It’s not relevant to the role I’m applying for.    

There are so many reasons why this isn’t a good practice. 

  1. Job Titles – these are often misleading.  I once enquired about the salary of an HR Manager role and was shocked to discover they were paying what amounted to an HR Advisor salary.   
  2. Internal candidates often get offered less than external appointments. Many years ago, I was the only internal appointment alongside three external appointments for some new HR roles that were all the same. I tried to negotiate on the salary and was told it was a “take it or leave it” offer.  Imagine my surprise some weeks later to discover all the external appointments were being paid much more than me leading to zero trust of my manager and low motivation in the role. 
  3. Salaries are assigned on the ability to negotiate.  Timid candidates generally get paid less which is where gender and diversity pay gaps arise.  
  4. Candidate will often get to offer stage and then decide the salary on offer isn’t high enough.

Over the years I have heard all the arguments against – you don’t want to limit your candidate pool by putting people off, you don’t want your competitors to know what you pay, there is more to the role than salary etc. 

One tweeter this week offered the view that “I don’t advertise the salary.  I think it’s limiting until you know the candidate and how the job might be shaped to their strengths and purpose.”  My response to that is that it might be applicable to executive or very senior roles, but generally employers have a good idea of what they are looking for and need, and therefore you pay for the position not the person.

Some interesting facts emerged during the Twitter chat.  For example, in the US state of Colorado they passed a law in January that mandates disclosure of salary/wage information on all job postings within the state via the Equal Pay for Equal Work Act.  

At the other end of the spectrum, one US employer was said to have had a policy that forbade employees from discussing their salary with each other.  Can you imagine trying to enforce that or the type of culture they must have? 

I am pleased to say that one client I am currently working with advertise all their positions with a salary.  They appear to have no trouble attracting and recruiting quality candidates and have low turnover.    

I would love to see more companies just trying it and see whether it has any negative impact on their ability to hire.  What have we got to lose?  In the real world, how many of us would buy a product without first knowing the price? Isn’t it time we took the game show guessing element out of recruitment once and for all?

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