What to know about “pay secrecy” policies

What to know about “pay secrecy” policies

| Feb 21, 2019 | Firm News |

Many employers have made it taboo for employees to discuss their salaries at work. However, there is nothing inherently illegal about this practice. In fact, employees have a right under law to do so. The National Labor Relations Act has been in effect since 1935. It gives workers the right to perform “concerted activities for the purpose of collective bargaining or other mutual aid or protection.” Ultimately, this means you and your coworkers have a right to talk about anything related to your jobs at work, which includes your salaries.

Although this law has been in effect for over 80 years, many employers have tried to get around it. Some bosses do not want their workers to discover some people make more money than others for the same work. During Barack Obama’s presidency, he strengthened this law to make it illegal for federal contractors to retaliate against workers who discuss their compensation. It is paramount for employers to stay on the right side of the law, and the best course of action is to pay employees who do the same work the same salary.

What can employers do?

Employers should pay people with the same job title the same amount of money. However, there may be legitimate reasons for such discrepancies. For example, one worker may make more money than another because she earned a master’s degree while the other only has a bachelor’s. In the event the lower-paid employee approaches the boss about this, having a valid reason in place can help avoid complications.

What should employers not do?

Some employers give their workers contracts with clauses stating workers cannot talk about salaries at work. However, such clauses will not hold up in court. Employees have a right to talk about salaries both at work and through social media. It is ideal for employers to have an employee compensation framework in place to justify all decisions.