We're excited to announce the release of our new feature, Pay Transparency, which empowers brands to be more transparent about their employees' pay ranges. In this blog post, we will discuss how Pay Transparency can help companies not only improve employee experience through increased transparency, but also comply with new regulations like California's Equal Pay Act, which among other requirements, mandates companies disclose bands if an employee asks for them. We’ll also explore the benefits of pay transparency, who benefits from it, and why some companies may be hesitant to implement it.
Why Pay Transparency is Important
Pay transparency is a hot topic in the HR world. Increased transparency leads to greater employee satisfaction, trust, and even productivity. When employees have a better understanding of their compensation, they feel more valued and engaged. Pay transparency can also help to mitigate pay inequities. However, many employers are also concerned that a lack of understanding by employees of why they fall at a particular point in their range could lead to dissatisfaction. They worry that employees may question why they aren’t higher in their range and managers may not always be equipped to give the best answer. They may even have legitimate concerns about whether or not existing employees’ positions in their ranges actually make sense (check out How to Create Compensation Bands for tips on getting your compensation bands right).
At Aeqium, we think pay transparency benefits both employees and employers. Not only will pay transparency help reduce wage inequalities, but also employees will gain a better understanding of their compensation and can make informed decisions about their careers. Employers, on the other hand, benefit from increased employee satisfaction, better retention rates, and improved diversity and inclusion efforts.
How Aeqium Helps with Pay Transparency
Our Pay Transparency feature allows companies to systematically share comp bands with employees. Admins can:
- Decide who they want to enable pay transparency for and which ranges they want to share (including salary bands, equity bands, and total cash / OTE bands)
- Provide content and link to resources on the company’s comp philosophy and how employees should think about their position in their pay range
- Educate employees right in their total rewards portal, alongside visualizations of all the components of their comp package.
Conversations between employees and their managers will still be important, but these features help a company ensure that there is a consistent baseline of understanding for all employees. Pay Transparency will also help companies stay compliant with regulations. For example, in California employees can ask to see the bands for their role and level. Before Aeqium, People leaders might have had to go digging through spreadsheets to find the relevant pay bands and then check to make sure they were updated before sending them to their employees. With Pay Transparency, employees can read and process this information on their own.
Pay transparency is a complex issue, but one that can lead to numerous benefits for both employees and employers. By implementing our new Pay Transparency feature, brands can be more transparent about their pay practices, while also ensuring compliance with regulatory requirements. All the while, People Ops teams and managers will save time trying to manage requests from employees. We believe that pay transparency is a crucial step towards a more equitable and transparent workplace, and we are excited to support our customers in this effort to provide equal pay for equal work.