As pay transparency laws proliferate, some employers remain resistant
As pay transparency laws proliferate, some employers remain resistant
As of last month, a new law in New York state requires most companies to include salary ranges in all job postings. The same thing is true in a handful of other states, including California, where a similar law took effect at the beginning of this year.
The laws are aimed at reducing wage gaps, particularly for women and people of color. They’re also aimed at creating transparency in the workplace. But not every workplace seems to want transparency. Four software developers who were fired from a Vermont company found that out the hard way.
One of them was Kestrel Swift. He worked as a developer at Vermont Information Processing, which makes digital tools for the beverage industry. Every time he brought up the issue of pay transparency with his manager over the years, Swift said he was shot down.
“The communication was always just like, ‘Yeah, I just don’t think upper management is gonna go for that,’” Swift said.
It’s been perfectly legal for most workers to discuss their compensation since the 1930s, thanks to the National Labor Relations Act. However, it’s only recently they’ve felt comfortable doing that, said Aaron Terrazas, chief economist at Glassdoor.
“It used to be that the rule of workplaces is you don’t talk money or politics,” Terrazas said. “Increasingly, that’s out of date.”
So when some of Swift’s co-workers decided to share their salaries, he was excited.
Here’s how they tell it:
In February 2022, Swift’s colleague, Kaleb Noble, was up for a promotion, and he wanted to get a sense of what other people in the same position were making. He said he reached out to another co-worker, Chris Bendel.
“I sent a message to Chris being like, ‘Hey, Chris, do you mind sharing your salary with me? It’s OK if you do not,’” Noble said.
Bendel was happy to share, and he suggested they take it a step further.
“Chris was like, ‘OK, we should just make a spreadsheet so this is public to everybody at the company so that everyone has this information to be able to fight for their salaries,” Noble said.
They created a Google spreadsheet where employees could voluntarily share their salary information, anonymously if they wanted to. And they passed it to two co-workers, including Kestrel Swift, who passed it along to others, he said.
“Within, like, an hour, it just totally took off,” Swift recalled.
About 30 employees signed on. But then, the four guys noticed an icon at the top of the spreadsheet. A member of the company’s upper management was lurking in the document. Bendel was working from home at the time.
“Within 30 minutes, you know, I’m sitting here at this desk I’m sitting at right now, and my computer just shuts off,” Bendel remembered. “And I was like, ‘Oh, no, I must’ve lost power or something.’”
He’d been fired. The other three spreadsheet creators — Swift, Noble and Gordon Dragoon — said they complained about Bendel’s firing, and within days, they were all fired too. They thought the reason for their dismissals was pretty clear: This was punishment for making and distributing that pay transparency spreadsheet.
So they filed a complaint with the National Labor Relations Board. And over the summer, an administrative law judge ruled in their favor. He ordered VIP to pay damages and offer the four their jobs back. At the end of September, the company appealed that decision to the full NLRB.
VIP’s lawyer declined an interview request. But in its appeal, the company said it fired those employees, in part, because they disparaged a planned reorganization at the company and had talked about quitting, not because of the spreadsheet.
This kind of dispute is something that the wave of new state laws could prevent by requiring companies to list salary ranges up front in job postings.
“And so you have now transparency not just between two co-workers, but also between firms,” said Zoe Cullen, an assistant professor of economics at Harvard University. She said these laws can have an effect within companies too.
“If a firm has to make public a salary range, then internally they will also have pressure to essentially stick to that range and potentially reduce pay gaps between two people,” Cullen said.
But if those laws are going to work, job seekers have an important role to play, said Terrazas at Glassdoor.
“Ultimately, I think the enforcement mechanism here has to be job seekers and job candidates choosing to apply to companies that are transparent and not apply to companies that are not,” Terrazas said.
All four former VIP employees have found new jobs, and most of them have noticed a very different culture in their new workplaces.
“There’s a large group of people at my company who have adopted the practice of putting their salary in their Slack description,” said Chris Bendel, referring to the messaging service many companies use.
“It’s as transparent as it can be,” he said. “And when I saw that, I was like, ‘This is awesome.’”
Plus, there’s no need to pass around a spreadsheet.
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