Re:In Silicon Valley, many want sharing salary info to be le...
by geofft on Tuesday July 21, 2015 @07:11PM
(#9926557)
I can see a world in which open salaries benefit both employers in aggregate and employees in aggregate. (Intuitively, this shouldn't be surprising; more information leads to a more efficient market.)
Open salaries have the effect of making it easier for people to ask for numbers close to the mean, and harder to ask for numbers far from them. Obviously this benefits employees currently making lower numbers. But also, if there are companies paying their "10x" programmers huge salaries because they're worried about them jumping ship, open salary data from other companies helps push back on that, which saves the company money (that could be used to fund paying everyone else more).
Companies that don't do heavy amounts of recruiting don't have a good sense of what competitive salaries are, because they aren't regularly getting indirect information from candidates who negotiate. Open salary info helps these companies pay closer to the true competitive salary, which prevents them from losing good candidates without risking overspending. This is definitely good for the company, but it's also good for employees who have a fairer choice of jobs at fairer salaries.
Closed salaries are a great way to maintain the status quo. There is some Prisoners' Dilemma-ish behavior where one company opening salaries alone probably gets them a particularly bad result in the short term, so the clever thing to do is to exert social pressure for everyone to cooperate.
Open salaries have the effect of making it easier for people to ask for numbers close to the mean, and harder to ask for numbers far from them. Obviously this benefits employees currently making lower numbers. But also, if there are companies paying their "10x" programmers huge salaries because they're worried about them jumping ship, open salary data from other companies helps push back on that, which saves the company money (that could be used to fund paying everyone else more).
Companies that don't do heavy amounts of recruiting don't have a good sense of what competitive salaries are, because they aren't regularly getting indirect information from candidates who negotiate. Open salary info helps these companies pay closer to the true competitive salary, which prevents them from losing good candidates without risking overspending. This is definitely good for the company, but it's also good for employees who have a fairer choice of jobs at fairer salaries.
Closed salaries are a great way to maintain the status quo. There is some Prisoners' Dilemma-ish behavior where one company opening salaries alone probably gets them a particularly bad result in the short term, so the clever thing to do is to exert social pressure for everyone to cooperate.