Women in Pennsylvania are paid 79 cents for every dollar men are paid, amounting to an annual wage gap of $10,507. The wage gap is worse for women of color as Asian women are paid 81 cents, Black women are paid 68 cents and Latinas are paid 56 cents for every dollar paid to white, non-Hispanic men.
As the conversation surrounding equal pay continues, pay transparency can help reduce the wage gap, allow women to negotiate effectively for higher pay, create closer relationships between employer and employee and create a fairer workplace.
When hiring managers are open about the pay employees receive, it puts all applicants in a more equitable position to make informed decisions regarding job offers, said Kelly Grace, a management professor.
Having transparency among employees could also push people to advocate for their salaries because they have context for what other employees are making, said Shreyasee Das, an economics professor.
“Maybe you and I are in the same office, and you get to know that you’re getting paid a little less than I am,” Das said. “It could push you to go tell HR, ‘Listen, I think I should be getting paid a little more.’”
Although talking about personal income can feel taboo it can help women feel more comfortable and normalize discussing wages.
With transparency, women could re-negotiate a new salary that is more comparable to their co-workers without feeling timid because they would have evidence to support their claims of unfair pay.
Oftentimes, women feel less comfortable negotiating pay than men do, with 74 percent of men and 58 percent of women feeling comfortable doing so, according to Indeed Hiring Lab.
Women feel uncomfortable when negotiating because it goes against societal values, like being nice and getting along with others, Grace said.
“All of the social things that traditionally women value and are good at seemed compromised when you’re in a situation where you’re asking for really what you’re worth,” Grace said. “Let’s be clear, we’re not asking to be overly rewarded, we’re just asking to have that compensation reflect what we’re worth.”
These negotiations can help empower women, even if the outcome isn’t higher wages. It can open the door for other opportunities like a signing bonus.
Pay transparency allows companies to attract better employees because the conversation around pay can help build a stronger relationship between employees and their companies, said Laura Craig, the associate director of Temple’s Career Center.
“It helps those candidates make better-informed decisions, it probably leads to more sustained engagement over a longer period of time between candidates soon-to-be-future employee and employer,” Craig said.
By being transparent about pay companies can also improve unity among workers, promote diversity and increase productivity as it prevents companies from hiding structural inequalities like pay discrimination, according to World at Work, a nonprofit organization.
Because transparency creates more equal and fair workplaces, employers and hiring managers must make pay ranges visible to both current and prospective employees.
While pay transparency benefits both the employer and employees, only a quarter of employees say their employers are transparent about salaries, CNBC reported.
The gender wage gap has not improved in the last 15 years and it is time for employers to do their part and use pay transparency to help close the gap.
“It encourages female workers to apply to places that have pay transparency, because they are more confident about knowing full information,” Das said. “They also know that this place cares about pay transparency, they care about the gender wage gap.”