Company Finds Real Advantages in Pay Transparency

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What happens when a company puts all of its salary information out in the open—yours, mine, the CEO’s, everyone’s? Apparently, at least in the experience of the New York City analytics startup SumAll, better communication between staff and management, and not very much drama.

SumAll, which has 40 employees, has shared pay information since its early days, according to Business Insider. Founder and CEO Dane Atkinson worked with his first employees to set the salary of each job. As the company expanded, that initial structure caused problems when more experienced employees thought they were worth more. In response, Atkinson made salaries negotiable and, perhaps most importantly, really listened to arguments for a raise.

In a feature on NPR’s Planet Money, Head of Marketing Chris Jadatz recounted how he felt underpaid when he saw that he was making $55,000 compared to his predecessor’s $95,000. Rather than let resentment fester, or quit, he approached Atkinson to talk about it. The result was a $20,000 raise. Though Atkinson didn’t feel Jadatz yet offered the same value as his predecessor, both were happy with the new pay level.

To Atkinson, the value of this kind of conversation—which happens “all the time,” NPR says—is the opportunity it presents to discuss an employee’s value to the company. “Often, he has to explain that the reason why the person makes more than you is that she’s more valuable to the company. And if you do what she’s doing, you can make more, too,” the network’s Lisa Pollack said in her report.

Another advantage of the approach, Atkinson told ThinkProgress, is that workers are less concerned about impressing the boss and more focused on doing work that will be recognized by everyone. “They strive to achieve in the eyes of the people that really matter… not just make me, the CEO, feel good,” he said. “You end up getting a much bigger brain trust for running the business.”

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