6 ms·

Many years ago, back when companies could ask for your previous compensation [0], a hiring manager once said to me "don't ever lie about your past compensation"

Many years ago, back when companies could ask for your previous compensation [0], a hiring manager once said to me "don't ever lie about your past compensation". I wasn't sure how they could figure this out at the time until someone later pointed out that many corporations do a credit history check on you as part of the background check. This gives them access to past compensation. The information asymmetry here is, as with much of hiring, pretty bonkers when they had both the current and past comp history during negotiations when you have just yours. You might also have the comp history of your friends too (if you share) but that's still tiny compared to the corporations. 0 - this was in NYC where it's now no longer allowed.

fred_is_fred 7mo ago
I don’t recall ever seeing a salary in my credit report. Certainly when applying for credit cards you are asked but generally they have you include all sources of income including bonus, passive income, and alimony. There are data sources for this info but I don’t think it’s technically a credit report.
- wombat-man 7mo ago
  Experian does collect and sell income data about people, in fact i think they pay companies directly for this information. This is helpful for salary negotiations. It’s not in a normal credit report though, true.
  - bitexploder 7mo ago
    Loan applications. Credit cards. They all ask for your income. I always put 1,000,000. Never been denied a loan.
    - PenguinCoder 7mo ago
      Mortgage loans and car loans in America also ask for your W-2 or proof of that said income. Can't prove it, they won't let you use your claimed income as basis for loan approvals.
      - bitexploder 7mo ago
        I never had to supply a W-2 for a vehicle loan. Just my SSN. I almost always get unsecured loans too. They just dump money into your bank account and say "please buy a car with this" and you keep the title. For a mortgage you do have to validate your income. The work around is to just buy your house in cash, I guess (sigh). So I guess mortgage loans leave you open there, but those happen less frequently and may not be good map of income level on a shorter period. Once in a while they want to see a bank statement or two showing actually paycheck deposits, but I only ever saw that on a mortgage. Once for the car loan they asked to see a balance or two via bank statement. So I showed them a bank account sitting around the $$ for the vehicle loan. I tend to just avoid loans if at all possible now though.
        jjtheblunt 7mo ago
        > They just dump money into your bank account and say "please buy a car with this" and you keep the title. where is this? you don't have or keep the title until the bank sees you paid off the loan, in every instance i've seen.
        elephanlemon 7mo ago
        An unsecured loan just a straight cash loan. In my experience the interest rates are usually a fair bit higher than a vehicle loan, and I would assume the maximum amount is generally quite a bit lower.
        jjtheblunt 7mo ago
        Ahhh, like if you were to put your new VW on your Visa card entirely. That might work: you'd have bought the car, from the point of view of VW and your DMV, so the DMV sends you the title, not Visa.
        bitexploder 7mo ago
        In my experience it really depends. You are still contractually and legally obligated to purchase a vehicle in many of these setups, they just don't follow up or enforce it directly in most cases. Loan rates are nothing like unsecured personal loan rates. Probably higher than best auto loan rates. With rates being what they are it may not make as much sense to use an unsecured loan at this point, but when rates are low the cost was negligible and the convenience worth it.
  - fred_is_fred 7mo ago
    Right - there are plenty of data sources here but it's not a credit report.
- jrexilius 7mo ago
  If I remember correctly, ADP and the other big payroll processors sell your income data, as do many of the finance apps that get access to your bank account data. They also have your rent and mortgage payments typically. It's not always a line item in your official credit report, but the data leaks (and is sold) everywhere. Probably the more correct phrasing would be "in your financial target data profile as sold by [credit agencies, et al]"?
- slicktux 7mo ago
  Equifax’s The Work Number buys salary data from employers and they use it for income verification when applying for loans and rentals. You’d be surprised how much data is out there; and it was all sold by entities you ‘trust’. One example being the DMV
  - joezydeco 7mo ago
    If you lease a car these days you will be swamped with offers from banks and lease-end "providers" as your end date approaches. I got really mad with the dealer until they told me it was the DMV that was selling that information. Regarding The Work Number: you have the right to see your own report and it's worthwhile to do so. And it's scary. A lot of the information is usually incomplete and/or full of holes. I can't believe anyone would base a decision on this data.
    - jjtheblunt 7mo ago
      as an example, i have received usmail junkmail addressed to my address, but with the name of my first cousin's husband's name, which makes no sense unless some incompetent data brokers are just merging their datasets in all sorts of random ways and seeing what sticks. i dream of phone calls costing the entity placing the call some significant-at-scale price, perhaps a dime, and bulk rate physical junkmail needing full postage.
endymi0n 7mo ago
"don't ever lie about your past compensation" — because they can't figure it out on their own and IF they do (at least in my jurisdiction), you've got a nice case on your hands to sue them for violating privacy laws. The correct answer is: ALWAYS lie about your past compensation. It's the only way to get forward, one way or the other.
- alexpotato 7mo ago
  This is one of those strategies that may be "correct" in the sense that it works once or twice, but isn't a great long term strategy. e.g. let's say you sue and then win: that's now in the public record (which any new hiring company can see).
  - steveBK123 7mo ago
    Its the perfect case for why labor organizes. Collectively battling this is good, but individually no one wants to because its personally high risk (legal costs, deter future employers hiring you) and low reward (some settlement that won't change your life).
    - bckr 7mo ago
      Are you part of a union? How can we get the tech industry unionized?
      - sdfjkhdfjkdhs 7mo ago
        [flagged]
    - deleted 7mo ago
      [deleted]
  - RajT88 7mo ago
    A better strategy is to push the conversation in another direction: - My current comp is X, but that's not what I am worth to you. - I've done my research, and someone with my experience is worth Y. I expect at least Y. You set your salary expectations with your opening bid instead of letting them make the opening bid. It's also contingent on you having done your research =)
jakevoytko 7mo ago
An old neighbor of mine was a headhunter. He once told me that some companies had a trick to get around the law. Upon getting hired, you'd sign a document saying that you'd agree to all policies in the employee handbook. Pretty standard stuff. One of the company policies was that you needed to prove any previous salary you stated in the negotiation. If it was too far off, they'd just terminate you. The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you.
- alexpotato 7mo ago
  > The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you. Yeah, "all bets are off" once you are a FTE.
- gcr 7mo ago
  Isn’t that too late to negotiate compensation? I had figured most of the value is knowing how to properly lowball candidates
  - zamadatix 7mo ago
    It sounds like negotiation would still be done however it normally would before things got to this point.
  - barbazoo 7mo ago
    It sounds made up. Who would go through the negotiating phase, hire the person go through all paperwork only to then gotcha them and fire them if they lied about their past salary? I've never seen an org that actually played games like that.
  - m3047 7mo ago
    Dunno, kind of sounds like hiring and then negotiating compensation.
    - 7mo ago
dfxm12 7mo ago
The information asymmetry here is ... pretty bonkers This is why you shouldn't trust anyone who sells you on the idea that the ability to negotiate your own deals against large corporations is a feature and not a bug. The information asymmetry, plus the difference in legal fire power & wherewithal to withstand a drawn out negotiation, will always put you at a disadvantage.
skeeter2020 7mo ago
I'm skeptical. Credit checks don't give you an accurate picture of your compensation and it's not like they get your transactional banking history or tax documents (yet). Even with that it would be impossible to get an accurate compensation figure within 25%, so while I agree there's an informational imbalance if that's how you're negotiating you've already lost.
- BeetleB 7mo ago
  Eh, I don't have the link at the moment - it was posted some years ago on HN. In the US, your employer very likely reports your salary to a national agency. And other companies can access it. You can go to the agency yourself, prove your identity, and see all your salary history.
  - GJim 7mo ago
    Good lord! I knew the USA has poor data protection law, though the very idea that companies can legally share such personal information is truly mind boggling. Why on earth aren't people doing something about this?
- array_key_first 7mo ago
  The Work Number by Experian gives all past income information. I think many (most?) companies participate in it, so it's somewhat likely your current income is being reported.
  - jcomis 7mo ago
    This is accurate, except theworknumber is an equifax product. Experian and transunion have similar products however that share past comp data in exchange for a fee and/or current data sharing. Basically, "theworknumber" lets employers see what you made previously in exchange for the employer sharing what they pay all/most employees currently. Large companies often share a lot of details too, such as yearly raises, bonuses, weekly rates, etc. Still, it is often inaccurate. For example, I have worked freelance extensively under my name (DBA) and llc and none of it is there. You can pull your record if you want. If your employer uses workday, they almost certainly share every paystub with theworknumber. You can freeze your data: https://employees.theworknumber.com/employee-data-freeze https://employees.theworknumber.com/employee-data-freeze HOWEVER, if you do so, many companies won't proceed with an offer until you unfreeze.
chrisBob 7mo ago
So, lie about RSU and Bonus? It seems like base salary would be easy to track, but other benefits would be much harder.
patatino 7mo ago
Lying about my compensation always worked so far
everforward 7mo ago
The information asymmetry is sort of wild to me. I can't really figure out an angle why this isn't bad for the same reasons insider trader is bad. I'm even okay with them having the info, I just think companies should be required to publish everyone's salaries. Redacting names is fine, but I should be able to look up the team I would join and see titles and salaries for everyone on the team.

fred_is_fred 7mo ago

I don’t recall ever seeing a salary in my credit report. Certainly when applying for credit cards you are asked but generally they have you include all sources of income including bonus, passive income, and alimony. There are data sources for this info but I don’t think it’s technically a credit report.

wombat-man 7mo ago
Experian does collect and sell income data about people, in fact i think they pay companies directly for this information. This is helpful for salary negotiations. It’s not in a normal credit report though, true.
- bitexploder 7mo ago
  Loan applications. Credit cards. They all ask for your income. I always put 1,000,000. Never been denied a loan.
  - PenguinCoder 7mo ago
    Mortgage loans and car loans in America also ask for your W-2 or proof of that said income. Can't prove it, they won't let you use your claimed income as basis for loan approvals.
    - bitexploder 7mo ago
      I never had to supply a W-2 for a vehicle loan. Just my SSN. I almost always get unsecured loans too. They just dump money into your bank account and say "please buy a car with this" and you keep the title. For a mortgage you do have to validate your income. The work around is to just buy your house in cash, I guess (sigh). So I guess mortgage loans leave you open there, but those happen less frequently and may not be good map of income level on a shorter period. Once in a while they want to see a bank statement or two showing actually paycheck deposits, but I only ever saw that on a mortgage. Once for the car loan they asked to see a balance or two via bank statement. So I showed them a bank account sitting around the $$ for the vehicle loan. I tend to just avoid loans if at all possible now though.
      - jjtheblunt 7mo ago
        > They just dump money into your bank account and say "please buy a car with this" and you keep the title. where is this? you don't have or keep the title until the bank sees you paid off the loan, in every instance i've seen.
        elephanlemon 7mo ago
        An unsecured loan just a straight cash loan. In my experience the interest rates are usually a fair bit higher than a vehicle loan, and I would assume the maximum amount is generally quite a bit lower.
        jjtheblunt 7mo ago
        Ahhh, like if you were to put your new VW on your Visa card entirely. That might work: you'd have bought the car, from the point of view of VW and your DMV, so the DMV sends you the title, not Visa.
        bitexploder 7mo ago
        In my experience it really depends. You are still contractually and legally obligated to purchase a vehicle in many of these setups, they just don't follow up or enforce it directly in most cases. Loan rates are nothing like unsecured personal loan rates. Probably higher than best auto loan rates. With rates being what they are it may not make as much sense to use an unsecured loan at this point, but when rates are low the cost was negligible and the convenience worth it.
- fred_is_fred 7mo ago
  Right - there are plenty of data sources here but it's not a credit report.
jrexilius 7mo ago
If I remember correctly, ADP and the other big payroll processors sell your income data, as do many of the finance apps that get access to your bank account data. They also have your rent and mortgage payments typically. It's not always a line item in your official credit report, but the data leaks (and is sold) everywhere. Probably the more correct phrasing would be "in your financial target data profile as sold by [credit agencies, et al]"?
slicktux 7mo ago
Equifax’s The Work Number buys salary data from employers and they use it for income verification when applying for loans and rentals. You’d be surprised how much data is out there; and it was all sold by entities you ‘trust’. One example being the DMV
- joezydeco 7mo ago
  If you lease a car these days you will be swamped with offers from banks and lease-end "providers" as your end date approaches. I got really mad with the dealer until they told me it was the DMV that was selling that information. Regarding The Work Number: you have the right to see your own report and it's worthwhile to do so. And it's scary. A lot of the information is usually incomplete and/or full of holes. I can't believe anyone would base a decision on this data.
  - jjtheblunt 7mo ago
    as an example, i have received usmail junkmail addressed to my address, but with the name of my first cousin's husband's name, which makes no sense unless some incompetent data brokers are just merging their datasets in all sorts of random ways and seeing what sticks. i dream of phone calls costing the entity placing the call some significant-at-scale price, perhaps a dime, and bulk rate physical junkmail needing full postage.

endymi0n 7mo ago

"don't ever lie about your past compensation" — because they can't figure it out on their own and IF they do (at least in my jurisdiction), you've got a nice case on your hands to sue them for violating privacy laws. The correct answer is: ALWAYS lie about your past compensation. It's the only way to get forward, one way or the other.

alexpotato 7mo ago
This is one of those strategies that may be "correct" in the sense that it works once or twice, but isn't a great long term strategy. e.g. let's say you sue and then win: that's now in the public record (which any new hiring company can see).
- steveBK123 7mo ago
  Its the perfect case for why labor organizes. Collectively battling this is good, but individually no one wants to because its personally high risk (legal costs, deter future employers hiring you) and low reward (some settlement that won't change your life).
  - bckr 7mo ago
    Are you part of a union? How can we get the tech industry unionized?
    - sdfjkhdfjkdhs 7mo ago
      [flagged]
  - deleted 7mo ago
    [deleted]
- RajT88 7mo ago
  A better strategy is to push the conversation in another direction: - My current comp is X, but that's not what I am worth to you. - I've done my research, and someone with my experience is worth Y. I expect at least Y. You set your salary expectations with your opening bid instead of letting them make the opening bid. It's also contingent on you having done your research =)

jakevoytko 7mo ago

An old neighbor of mine was a headhunter. He once told me that some companies had a trick to get around the law. Upon getting hired, you'd sign a document saying that you'd agree to all policies in the employee handbook. Pretty standard stuff. One of the company policies was that you needed to prove any previous salary you stated in the negotiation. If it was too far off, they'd just terminate you. The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you.

alexpotato 7mo ago
> The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you. Yeah, "all bets are off" once you are a FTE.
gcr 7mo ago
Isn’t that too late to negotiate compensation? I had figured most of the value is knowing how to properly lowball candidates
- zamadatix 7mo ago
  It sounds like negotiation would still be done however it normally would before things got to this point.
- barbazoo 7mo ago
  It sounds made up. Who would go through the negotiating phase, hire the person go through all paperwork only to then gotcha them and fire them if they lied about their past salary? I've never seen an org that actually played games like that.
- m3047 7mo ago
  Dunno, kind of sounds like hiring and then negotiating compensation.
  - 7mo ago

dfxm12 7mo ago

The information asymmetry here is ... pretty bonkers This is why you shouldn't trust anyone who sells you on the idea that the ability to negotiate your own deals against large corporations is a feature and not a bug. The information asymmetry, plus the difference in legal fire power & wherewithal to withstand a drawn out negotiation, will always put you at a disadvantage.

skeeter2020 7mo ago

I'm skeptical. Credit checks don't give you an accurate picture of your compensation and it's not like they get your transactional banking history or tax documents (yet). Even with that it would be impossible to get an accurate compensation figure within 25%, so while I agree there's an informational imbalance if that's how you're negotiating you've already lost.

BeetleB 7mo ago
Eh, I don't have the link at the moment - it was posted some years ago on HN. In the US, your employer very likely reports your salary to a national agency. And other companies can access it. You can go to the agency yourself, prove your identity, and see all your salary history.
- GJim 7mo ago
  Good lord! I knew the USA has poor data protection law, though the very idea that companies can legally share such personal information is truly mind boggling. Why on earth aren't people doing something about this?
array_key_first 7mo ago
The Work Number by Experian gives all past income information. I think many (most?) companies participate in it, so it's somewhat likely your current income is being reported.
- jcomis 7mo ago
  This is accurate, except theworknumber is an equifax product. Experian and transunion have similar products however that share past comp data in exchange for a fee and/or current data sharing. Basically, "theworknumber" lets employers see what you made previously in exchange for the employer sharing what they pay all/most employees currently. Large companies often share a lot of details too, such as yearly raises, bonuses, weekly rates, etc. Still, it is often inaccurate. For example, I have worked freelance extensively under my name (DBA) and llc and none of it is there. You can pull your record if you want. If your employer uses workday, they almost certainly share every paystub with theworknumber. You can freeze your data: https://employees.theworknumber.com/employee-data-freeze https://employees.theworknumber.com/employee-data-freeze HOWEVER, if you do so, many companies won't proceed with an offer until you unfreeze.

chrisBob 7mo ago

So, lie about RSU and Bonus? It seems like base salary would be easy to track, but other benefits would be much harder.

patatino 7mo ago

Lying about my compensation always worked so far

everforward 7mo ago

The information asymmetry is sort of wild to me. I can't really figure out an angle why this isn't bad for the same reasons insider trader is bad. I'm even okay with them having the info, I just think companies should be required to publish everyone's salaries. Redacting names is fine, but I should be able to look up the team I would join and see titles and salaries for everyone on the team.