• Article
  • 12 Jan 2022
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George Allen

Should It Be a Legal Requirement for Companies to Post Salary Ranges in Job Ads?

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New York City recently passed a momentous wage transparency law.

In short, it states that all job adverts must legally post the salary range in a bid to end wage discrimination.

While no such laws currently exist in the UK, it is a sign of a greater worldwide debate about fairer employment practices.

So, should it be a legal requirement to post salaries in job adverts?

What Does it Mean for Employers?

As stated, the new law requires all employers to post a job’s salary range in the advert.

You may already know about the state of the US job market at the moment, which is undergoing something called The Great Resignation.

Long-term wage stagnation, coupled with the pandemic, has led to millions of Americans leaving low-paying jobs in search of better work.

The law intends to end wage discrimination and make jobs more attractive to potential employees.

It is not an unreasonable suggestion, as, regardless of a person’s passion for their career, the vast majority of us work to earn money.

Wages are a crucial factor in deciding whether a job is worth applying for, so salaries should be front and centre of any job advert.

Such laws already exist in California and Colorado and will likely spread across most of the USA in the coming years.

Similarly, ten countries in the EU have wage transparency laws, including Denmark, Germany, and Spain.

Is it time for the UK to follow suit?

Pay Gap

Wage Transparency in the UK

The UK already has wage transparency laws for executive-level employees, which came into force in 2019.

Also, a 2020 report by the Fawcett Society found that fewer than 30 per cent of women believed an employer would tell them whether male co-workers earned more money.

In short, the UK is long overdue wage transparency regulations, which would address numerous issues in employment.

Gender inequality is the most obvious, but it would also highlight potential racial- and economic-related salary inequalities, too.

The Pros and Cons of Wage Transparency

The advantages of being open about pay should be clear.

Importantly, it would create greater equality among potential employees, as everyone would (in theory) have the same rate of pay.

Whether an employer then raises the rate of pay at equal levels once employed is, of course, a different matter.

Also, it will save everyone time.

As any recruiter will know, there is a noticeable drop-off in interest once salary ranges come up.

However, this is not the applicant’s fault, as it is not unreasonable to decline a job if it does not meet pay expectations.

So, if applicants know a job’s salary range, only those who consider it adequate will apply, making it a win-win.

Pay transparency will allow interviewers to focus more on candidate attributes, too.

At least some portion of an interview is devoted to salary discussion and negotiation, so if this is removed, it gives more time for important conversations.

But are there any downsides?

Put simply, no, not really.

A company might feel slighted that they have to spend more on wages to attract the right talent, but this is the price of hiring effective and worthwhile individuals

Wage transparency may also lead to current employees feeling slighted but, again, that is a sign of larger potential wage problems within an organisation.

The Wider Debate on Wage Transparency

We have written extensively in the past about the changing state of employment in the UK, particularly in our specialist sector.

As recruiters, we understand it is a widely talked about subject.

We are eager to hear your thoughts, too, so please feel free to express your opinions to join in the wider debate.