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Individual states’ pay transparency laws are already applying upwards pressure on salaries across the country. My company has multiple groups in different stat

Individual states’ pay transparency laws are already applying upwards pressure on salaries across the country. My company has multiple groups in different states including Colorado, and in anticipation of needing to post salary ranges for our open positions in Colorado, my group (with no positions in Colorado) preemptively bumped up everyone’s salaries to the midpoint of their pay bands to avoid anyone becoming frustrated if they learned they were in the bottom half. Despite the preemptive adjustments, a colleague of mine became angry and quit when they found out their salary wasn’t at the very top of their position’s pay range. So pay transparency laws are having a big impact—not only in the obvious cases of candidates negotiating salaries in the states that passed the pay transparency laws, but also for average employees in other states who didn’t even need to do anything except learn how much their labor was worth.

zdragnar 4y ago
I think your example might be more of an exception than a rule; the last company I was in that introduced pay bands only bumped up people who were below the bottom of the band. The only people who were upset were those who found out some people were way over the new pay band and generated a bit of gossip over how those people were way overpaid for the quality of their work
TulliusCicero 4y ago
> my group (with no positions in Colorado) preemptively bumped up everyone’s salaries to the midpoint of their pay bands Uhh, surely I'm not the only one seeing the obvious flaw here, right? Is the inevitable outcome here that pay bands will now cover a range where nobody is actually in the lower half, ever? That lower half of the range will just be there as a sort of psychological buffer?
- bombcar 4y ago
  That's very common in anything that has a range. The pay bands will shift to compensate for it.
- marricks 4y ago
  So the pay bands go up. Everyone gets paid more, board salary go down a bit, and things hopefully become a bit more event. Sounds good? Things have been going the other direction far too long.
  - jeremyjh 4y ago
    How does that follow? They will just lower the bottom of the pay bands, and now people who in the bottom third are at the midpoint without another dollar being spent.
    - eropple 4y ago
      And then, because law is not code and being technically correct is frequently not the best kind of correct, the question becomes "OK, are there actually any employees at that point in the pay band?" and folks start tugging their collars and going "well..." until that activity becomes disallowed, either via judicial interpretation or legislative amendment.
  - TulliusCicero 4y ago
    > So the pay bands go up. They can't, though; if you do that, now there are people in the bottom half, and they're upset that they're 'below average'. You basically need a vanity range for pay.
    - sangnoir 4y ago
      It's not a vanity range if it's leading to real-life salary adjustments.
      - TulliusCicero 4y ago
        Vanity clothing sizing leads to real life changes in clothes measurements too.
  - throwaway09223 4y ago
    Board retainers aren't significant expense anywhere as far as I'm aware. Often their stipends are less than an employee's pay. For example, Google's board stipend is $100k, which is about half the median total comp of an average employee (less, counting benefits). Walmart I think pays their board $60k. You may be thinking of executive comp, but even then it is generally not significant amount. You could completely eliminate and redistribute executive compensation at Wal-Mart and it wouldn't really make a measurable difference in employee hourly salaries.
- collegeburner 4y ago
  We all now work at Lake Wobegon. Which means salaries will be set to average value of the position and lazy people will be subsidized by hard workers and better contributors. Not everybody contributes the same value.
kodah 4y ago
I'm leaving my company because it took so much "upwards pressure" to make this happen. Literally hundreds of people screaming in a townhall that the companies wages were so low that housing was eating up most of their paycheck while mandating a return to work from the top. This is in the Bay Area. I do think there's something to be said about a company that does not tend to the needs of its flock proactively.
- jzawodn 4y ago
  I see what you did there.
- drewcon 4y ago
  I’m not sure why the company is responsible at an individual level for what’s going on in the Bay Area. They can’t tell you how to manage and interact with the expenses of your life. If you’re mad at anyone, walk down to city hall and tell them to build more housing.
  - vkou 4y ago
    > I’m not sure why the company is responsible at an individual level for what’s going on in the Bay Area. No, but it's responsible for not paying well, while mandating that everyone working for it must live in the most expensive region in the country. > If you’re mad at anyone, walk down to city hall and tell them to build more housing. Or walk across the street to a competitor. It is the Bay area, after all.
    - listenallyall 4y ago
      Mandating? Every employee at the company voluntarily agreed to the terms of their employment, the wage, the location, etc. prior to starting.
      - vkou 4y ago
        It's a mandate. They could have mandated that remote work is acceptable. They didn't. They are now surprised that people are leaving. Just like how if you don't like the mandates issued by your government, you are free to move to a different country. Or to petition it to change them. They are still mandates, though, despite you choosing out of your own free will to submit to them, by virtue of not leaving. This website also has mandates about how its posters are expected to behave, that you submit to - despite being here voluntarily.
foobiekr 4y ago
The noncompete thing is actually a much, much bigger deal than the pay transparency thing. I have a friend who is waiting out a 2Y noncompete that he foolishly agreed to in Texas.
- social_quotient 4y ago
  It’s a right to work state, so maybe there is more to it than a vanilla NC?
  - lthornberry 4y ago
    I don't know anything about Texas non-compete law, but "right to work state" refers to restrictions on unionizing. It has nothing to do with non-compete clauses.
    - shkkmo 4y ago
      The "right to work" is about restrictions on making unions mandatory, so you are correct but glossing over an important details. In practice it generally means that forming an effective union is much harder and thus harms workers, but theoretically it could be paired with other laws that supported unions but that didn't centralizing their power and removing worker choice.
- snicker7 4y ago
  So he’s getting paid full salary for two years and doing nothing? Sounds like a dream!
  - biztos 4y ago
    I sort of doubt that's how it works in Texas, but in Germany that's the law! A company can only prevent you from working for a competitor by A) keeping you employed by them; or, B) paying what the competitor would pay you. When I was an employee in Germany I always thought it would be fun to get stuck in B) and get an "offer" for like 5x my current salary and see what happens.
itronitron 4y ago
>> quit when they found out their salary wasn’t at the very top Such an elegant implementation of the 'no assholes' policy.
AmericanChopper 4y ago
All existing remuneration levelling mechanisms (such as salary bands) contribute towards the creation of two classes of workers, and pay transparency laws do the same. You end up with people who are happy to be in their salary band, and people who become contractors. Every place I’ve worked for the past 10 years has had salary bands, and I’ve always been paid far more than the highest band offered. Because I’ve never been an employee, it’s simply never applied to me. I don’t get counted in the diversity statistics either, which is also great. I guess transparency regulations take the feeling of pressure off those who aren’t competent negotiators, but if the goal is to decrease inequalities, they won’t accomplish that.

zdragnar 4y ago

I think your example might be more of an exception than a rule; the last company I was in that introduced pay bands only bumped up people who were below the bottom of the band. The only people who were upset were those who found out some people were way over the new pay band and generated a bit of gossip over how those people were way overpaid for the quality of their work

TulliusCicero 4y ago

> my group (with no positions in Colorado) preemptively bumped up everyone’s salaries to the midpoint of their pay bands Uhh, surely I'm not the only one seeing the obvious flaw here, right? Is the inevitable outcome here that pay bands will now cover a range where nobody is actually in the lower half, ever? That lower half of the range will just be there as a sort of psychological buffer?

bombcar 4y ago
That's very common in anything that has a range. The pay bands will shift to compensate for it.
marricks 4y ago
So the pay bands go up. Everyone gets paid more, board salary go down a bit, and things hopefully become a bit more event. Sounds good? Things have been going the other direction far too long.
- jeremyjh 4y ago
  How does that follow? They will just lower the bottom of the pay bands, and now people who in the bottom third are at the midpoint without another dollar being spent.
  - eropple 4y ago
    And then, because law is not code and being technically correct is frequently not the best kind of correct, the question becomes "OK, are there actually any employees at that point in the pay band?" and folks start tugging their collars and going "well..." until that activity becomes disallowed, either via judicial interpretation or legislative amendment.
- TulliusCicero 4y ago
  > So the pay bands go up. They can't, though; if you do that, now there are people in the bottom half, and they're upset that they're 'below average'. You basically need a vanity range for pay.
  - sangnoir 4y ago
    It's not a vanity range if it's leading to real-life salary adjustments.
    - TulliusCicero 4y ago
      Vanity clothing sizing leads to real life changes in clothes measurements too.
- throwaway09223 4y ago
  Board retainers aren't significant expense anywhere as far as I'm aware. Often their stipends are less than an employee's pay. For example, Google's board stipend is $100k, which is about half the median total comp of an average employee (less, counting benefits). Walmart I think pays their board $60k. You may be thinking of executive comp, but even then it is generally not significant amount. You could completely eliminate and redistribute executive compensation at Wal-Mart and it wouldn't really make a measurable difference in employee hourly salaries.
collegeburner 4y ago
We all now work at Lake Wobegon. Which means salaries will be set to average value of the position and lazy people will be subsidized by hard workers and better contributors. Not everybody contributes the same value.

kodah 4y ago

I'm leaving my company because it took so much "upwards pressure" to make this happen. Literally hundreds of people screaming in a townhall that the companies wages were so low that housing was eating up most of their paycheck while mandating a return to work from the top. This is in the Bay Area. I do think there's something to be said about a company that does not tend to the needs of its flock proactively.

jzawodn 4y ago
I see what you did there.
drewcon 4y ago
I’m not sure why the company is responsible at an individual level for what’s going on in the Bay Area. They can’t tell you how to manage and interact with the expenses of your life. If you’re mad at anyone, walk down to city hall and tell them to build more housing.
- vkou 4y ago
  > I’m not sure why the company is responsible at an individual level for what’s going on in the Bay Area. No, but it's responsible for not paying well, while mandating that everyone working for it must live in the most expensive region in the country. > If you’re mad at anyone, walk down to city hall and tell them to build more housing. Or walk across the street to a competitor. It is the Bay area, after all.
  - listenallyall 4y ago
    Mandating? Every employee at the company voluntarily agreed to the terms of their employment, the wage, the location, etc. prior to starting.
    - vkou 4y ago
      It's a mandate. They could have mandated that remote work is acceptable. They didn't. They are now surprised that people are leaving. Just like how if you don't like the mandates issued by your government, you are free to move to a different country. Or to petition it to change them. They are still mandates, though, despite you choosing out of your own free will to submit to them, by virtue of not leaving. This website also has mandates about how its posters are expected to behave, that you submit to - despite being here voluntarily.

foobiekr 4y ago

The noncompete thing is actually a much, much bigger deal than the pay transparency thing. I have a friend who is waiting out a 2Y noncompete that he foolishly agreed to in Texas.

social_quotient 4y ago
It’s a right to work state, so maybe there is more to it than a vanilla NC?
- lthornberry 4y ago
  I don't know anything about Texas non-compete law, but "right to work state" refers to restrictions on unionizing. It has nothing to do with non-compete clauses.
  - shkkmo 4y ago
    The "right to work" is about restrictions on making unions mandatory, so you are correct but glossing over an important details. In practice it generally means that forming an effective union is much harder and thus harms workers, but theoretically it could be paired with other laws that supported unions but that didn't centralizing their power and removing worker choice.
snicker7 4y ago
So he’s getting paid full salary for two years and doing nothing? Sounds like a dream!
- biztos 4y ago
  I sort of doubt that's how it works in Texas, but in Germany that's the law! A company can only prevent you from working for a competitor by A) keeping you employed by them; or, B) paying what the competitor would pay you. When I was an employee in Germany I always thought it would be fun to get stuck in B) and get an "offer" for like 5x my current salary and see what happens.

itronitron 4y ago

>> quit when they found out their salary wasn’t at the very top Such an elegant implementation of the 'no assholes' policy.

AmericanChopper 4y ago

All existing remuneration levelling mechanisms (such as salary bands) contribute towards the creation of two classes of workers, and pay transparency laws do the same. You end up with people who are happy to be in their salary band, and people who become contractors. Every place I’ve worked for the past 10 years has had salary bands, and I’ve always been paid far more than the highest band offered. Because I’ve never been an employee, it’s simply never applied to me. I don’t get counted in the diversity statistics either, which is also great. I guess transparency regulations take the feeling of pressure off those who aren’t competent negotiators, but if the goal is to decrease inequalities, they won’t accomplish that.