You’ve heard the buzz and read the news on LinkedIn, and all of it begs the question – what do salary transparency requirements truly mean for businesses and the workforce in general? And, most importantly, what do business owners need to know about including salary ranges in job postings?
While the mandate is still gaining momentum in Ontario and won’t be required until early 2024, it’s already a requirement in British Columbia and Prince Edward Island.
Including salaries in job postings is not just a legislative change, but a cultural shift towards greater transparency and equity in the workplace.
Understanding and adapting to this trend is crucial for all employers, including startups and small to medium-sized businesses (SMBs). Depending on the size and status of your business, you may or may not have a dedicated HR contact or another confidante to help answer your questions about the matter. That’s where we hope to provide some clarity!
In this article, we’ll share what business leaders need to know now and address some common challenges regarding salary transparency (and how you can navigate them).
Understanding The New Salary Transparency Legislation: Ontario and Beyond
Ontario has recently passed legislation requiring employers to include salary ranges in their job postings – originally, a similar legislation was proposed in 2018. In British Columbia and Prince Edward Island, this is already mandatory as of 2023. In the United States, New York enacted a similar mandate as well…although it was pushed back many months before becoming official.
In any case, we’re happy to see this progress across select provinces and states. It’s been a long time coming.
Why? Because, this move aims to enhance pay equity and transparency in the hiring process, which is something that many would argue is long overdue across all borders. Yet, most employers don’t typically include this information.
“Only about 37 per cent of all online job postings in Ontario last year included salary information.” – CBC
For employers, salary transparency means a new approach to crafting job postings and a clearer understanding of compensation expectations for job seekers. This change reflects a larger movement across Canada towards more open and equitable workplace practices.
How so? Well…
For one thing, it’s no secret that ever since women entered the workforce, there have been pay disparities between genders. There have also, undoubtedly, been instances where inequity impacted minorities in workplaces, regardless of their gender or job title.
However, while this is a small step forward, NDP MPP leader (Toronto, St. Paul’s) Dr. Jill Andrew pointed out in a recent interview with the National Post that this is ‘a half measure’ and will not completely solve pay equity issues.
…And she’s correct. These mandates must be enforced in order to be effective.
Employers mustn’t only provide a clear and honest salary range in each job posting they create, they must also understand what this mandate truly means (in terms of pay equity, better workplace culture, and even better talent sourcing) to employers and employees alike.
What Does The Salary Transparency Legislation Mean?
Prospective candidates being able to understand their potential salary range prior to applying to a job means a few things for you, as a business leader.
In layman’s terms, this mandate means you’ll have to provide a salary range in every job posting; whether internal, on Indeed, or on another job board. That might look something like this: “ X Manager, Full Time, $50,000-$60,000.”
What this doesn’t mean is that you should throw a random, broad range on a posting just to appease the mandate. As stated earlier, enforcement is key, so including a range of $15,000-$150,000 is, in many cases, asinine (if we’re being honest). Doing that certainly won’t attract top candidates, either.
Gone are the days of withholding salary information until an offer is presented, and treating salaries like a dirty little secret.
What about commission and bonuses?
If the salary range you have in mind for a role will vary based on commission and bonuses, it’s best you disclose that clearly in the job posting, and provide a practical range. That range could, perhaps, be based on starting pay or what employee’s typically earn in that role.
If you’re worried about your current employee’s seeing other salaries for similar roles at your company, fret not – that’s a valid concern and we’ll address it – so keep reading!
Why Does Salary Transparency Matter?
Including a salary or salary range in job postings will help you become a talent magnet!
You’ll find that you’re able to consistently target and acquire A-Players, and discover a more diverse and unique talent pool when you include salary ranges in your job posting.
How is this possible?
It’s pretty simple! First, people will self-disqualify easily when they see a salary range that doesn’t suit them. This is a win for all.
In your case (as a leader), why waste time on an interview process only to have an candidate turn down your offer due to the salary? Your time and resources are valuable!
Second, when job seekers see an appealing salary range, along with other components of their potential compensation, such as benefits or learning and development perks, they’ll feel inclined to apply. It’s what today’s workforce expects to see.
A job posting is already a critical component within a stellar talent acquisition strategy, and one that includes a salary range will show that you’re a modern and compliant employer.
This will pique the interest of many…including some talented people who may not have applied otherwise.
What Impact Can Salary Transparency Have On A Business?
Salary transparency can help you acquire needle-in-a-haystack talent and in doing so, continuously foster a culture of transparency and fairness…and build an incredible team.
Seeing a salary attached to a job posting can help encourage applications from people who perhaps feel they don’t have all the qualifications for a role, or, who have been underpaid in the past for a similar role and approach job applications with caution.
In reality, finding A-Players who align with your culture, demonstrate your values, and exhibit several malleable and developing skills is vital.
These are the people who will make invaluable contributions to your team; regardless of their past experiences. These are the people you want.
This level of transparency is a step forward in addressing the gender pay gap, showcasing a commitment to fairness and equality in the workplace. And, it shows that you’re an employer who abides by current legislation.
Culture should be a KPI at any business, and including a salary can really aid in qualified applications flooding your inbox, building a winning, culturally-aligned team, and having a great reputation.
And, if you’re new here, you should know that at Castle HR, we believe that when business leaders put the ‘Right People in the Right Seats’ at their company, it’ll be hard NOT to find success.
Building a thriving business and team comes down more than just your product or service and marketing. It’s all about the people you have by your side. That’s why it’s crucial to evolve your HR foundations, retention strategies, onboarding plan, and especially, your talent acquisition strategy.
Let’s face it, you can’t build a great business if you don’t find the right people to fill the roles and grow with you – and salary transparency can help accomplish that.
How Salary Transparency Affects Company Culture
By now, you already know that incorporating a salary range in your job postings does more than just meet legislative requirements; it speaks volumes about a company’s values, and can significantly impact your company culture.
A transparent approach can foster a culture of trust and openness; these are essential qualities for any growing business. This transparency is not only attractive to potential employees but also positions a company as an ethical, compliant and forward-thinking employer.
However, it is possible that the road toward salary transparency may feel uncertain for some leaders.
Here are a few challenges we believe are worth addressing:
It goes without saying that a current employee of yours who earns a salary of $60,000 a year will be upset if they see you’re hiring for an identical role and offering $90,000 to the incoming candidate.
The same could be said if someone on your team realizes that their coworker with equal or less experience is being paid significantly more than them.
Unfortunately, this is something that many women and minorities have faced in the workplace for decades.
“According to government data, women in Ontario earn an average of $0.87 for every dollar earned by men – a number that is worse for racialized and Indigenous women.” -CBC
To mitigate this problem, you first need to ensure that you’re paying your people fairly. Period.
Increasing other salaries to reflect current market trends (and ensure each person on your team is being compensated fairly) is step one.
If that is easier said than done, then you should take look at your current team and ask yourself, “Do I truly have the right people working for me? Is a particular employee underperforming? Is a salary negotiation fair?”
In some situations, terminating an employee who is underperforming (saving money and resources in the long run) and starting fresh with a new hire may be best.
Of course, we aren’t suggesting that you terminate people who might ask questions – but you do have to consider what incoming talent will want to be paid for the role, if you’re paying your team fairly, if you’re currently paying the right people to work for you.
If you simply don’t pay fairly, or have issues with top performers requesting a raise, that’s a YOU problem. An HR Professional can help you build a compensation plan and better understand employee expectations.
*Note that terminations are tricky and can put your business at risk. Always consult with an HR or legal professional before taking action.
Finding the Right People, Putting Them In The Right Seat
We always ask our clients if they’re putting the Right People in the Right Seats.
Why? Because salary transparency is a slippery slope that involves more than most think!
Nurturing the growth of people who truly care about their job is the key to success. But first, you have to find them.
Job postings are your chance to communicate your company’s core values, and attract like-minded talent. If a leader cannot clearly define their values, and the key accountabilities tied to each role, they’ll struggle to craft a compelling job description (which can hinder their own understanding of the role and salary). Then, they’ll fail to write a job posting that truly resonates with the talent they want. This isn’t always an easy conversation to have. But, as mentioned earlier, looking at your business as a whole — analyzing your profits, performance and goals — can help paint a better picture.
Remember: without understanding you values, you won’t know who you need on your team. Without this knowledge, crafting a job description and job posting can be difficult. This only increases the chance of hiring people who truly aren’t right for the job, and who don’t align with the company culture and values; no matter what salary you offer.
It’s important to reflect on how your organization views compensation, and where you benchmark your business in the market or industry. Along with this, reviewing total compensation with each of your employees is always recommended. Remember: total compensation includes benefits, learning and development opportunities, and other perks!
Providing a salary or salary range that reflects your current capabilities and doesn’t put your company at a disadvantage is also crucial. You don’t want to pay the low end, but you also understand that some great talent may push for the high end of the range you provide. You need to weigh your options without making impulsive or desperate decisions.
The size of your organization may also play a role in how much you pay people, too.
If you’re a successful business with decades of experience and 100+ employees, you’ll likely have a bit more wiggle-room than a newer business with a dozen people on their team.
This isn’t always the case, but that’s why a bit of research and analysis is helpful when it comes to deciding on salaries.
Development and Growth Plans
While it’s true that some employees will remain complacent in a role for decades, and never ask about a salary increase, that doesn’t mean they aren’t deserving of it. They may have found that they never had the opportunity to ask about development or raises!
Transparency is the new norm. The truth is, many people on your team are likely eager to learn, map out their career path, and climb a ladder during their time at your business. With that said, investing in your A-Players will help your business as you scale, and setting out a clear plan for growth and development can help mitigate some challenges with salary transparency.
When you include salary ranges in job postings, you should also note that there is potential for increases with their future, as well as ongoing learning, development and promotions. (If applicable, this varies by company and role). These are the things that today’s top talent wants.
Knowing where your employees are going and want to go, and keeping both parties aligned, is essential and can help navigate conversations about pay and other opportunities.
This is why we implement Modern Performance Reviews for our clients – having quarterly, two-sided conversations about growth removes any guesswork and fosters a culture of transparency – which is what you need now that salary ranges are (or, are about to be) a requirement. It also provides the opportunity for compensation discussions to take place; compensation isn’t always tied to performance, but you can set the expectation that you’ll meet each quarter and take it from there.
Salaries in Job Postings: Key Takeaways
The trend – and for some provinces and states, the mandate – of including salary ranges in job postings is a reflection of a broader movement towards transparency and equity in the workplace. It is important progress and we’re all for it. We always say, “adapt and thrive, or get left behind” when it comes to modern leadership.
The emergence of AI in the workplace and the normalization of remote work brought about a shift in workplace demands. The pandemic in 2020 also served decades of change (in terms of HR as well) in just two short years. A lot has happened, and today’s workforce values transparency, cultural alignment, work-life balance, and fair working conditions (among other things).
Salary transparency requirements are just another key player in enhancing pay equity in the hiring process, modernizing the workplace, and meeting the expectations of top talent!
For startups and SMBs, adapting to salary transparency inclusion is not just about compliance; it’s an opportunity to build trust, attract the right talent, and set a foundation for a positive company culture. As we navigate these changes, it’s important to remember that transparency in compensation is just one piece of the puzzle in creating a thriving and equitable workplace.
For businesses operating nationally or in multiple provinces, understanding and adhering to these variations is vital.
Salary is just one part of a compensation package. Employers should also highlight other aspects of their compensation, like benefits, professional development opportunities, and company culture. This holistic view not only attracts candidates but also paints a complete picture of what it’s like to work at your company.
…but, in order to do any of this well, you require a great talent acquisition strategy and process and a thorough understanding of who you want to work at your growing company!
How Castle HR Can Help With Salaries in Job Postings
There are a lot of moving parts in a complete HR strategy! Including salaries in job postings comes down to a great talent acquisition strategy…and that isn’t something that can be drafted and executed on the fly.
If you need help understanding your values, talent acquisition and retention strategies, or, with navigating leadership training and difficult conversations Castle HR can be of service. We offer affordable (and fractional) outsourced HR to leaders of startups and SMBs.
What are you waiting for? Bring all of your questions to the table and see if we’re a good fit…Book a complimentary call today!