This article originally appeared in the January 2022 issue of Security Business magazine. When sharing, don’t forget to mention Security Business magazine on LinkedIn and @SecBusinessMag on Twitter.
If you have been on LinkedIn lately, you have probably seen a lot of debate about something called compensation transparency. With the increase in pay equity laws across the country, many candidates are calling for more information regarding salary range when it comes to applying for a new position.
As these changes occur, it means that hiring managers, HR officials, and companies collectively need to adapt to stay current with the trends in the market.
The laws surrounding pay equity are relatively new and were formulated with the general idea of closing the wage gap between protected classes. The biggest change is that unless a company has already extended an offer, hiring officials are not allowed to ask current compensation from a prospective candidate. These laws are in place in many states and cities across the country and are constantly expanding – so if this is unfamiliar, make sure to do some research on the local laws to ensure that these stipulations are being met.
Salary Ranges with Job Postings
Now, when it comes to negotiating compensation, working in the blind is rarely a beneficial tactic; thus, these changes have sparked debates on whether compensation ranges should be shared on job postings and when compensation should be brought up overall.
My personal take on this is two-fold. While I agree that there should be transparency in the compensation negotiation, there are some pros and cons. When companies determine ranges for compensation, it is an educated guess at best. Until market research is conducted, the range is usually not 100% accurate.
On the one hand, sharing a range of $50,000-$70,000 for a job posting provides candidates with complete transparency; however, it discourages candidates currently making $71,000 and above from applying. It is not uncommon for positions to be hired above the initially determined compensation range. Conversely, a junior candidate may read that and gawk at the 90k salary, but their experience may not warrant it. Because the compensation range may not be in line, there is a possibility it may not capture the right candidate’s attention.
At the same time, the positives are that most candidates who apply will be in the compensation range for the position, and that candidates will appreciate the information up front – so it will likely waste less time.
The Human Element
Hiring is human. Nothing is better than talking live in person or over the phone or zoom about compensation. It is all about the human connection. The reality is, “old-school” recruiting methodology does not work today.
Here’s an example: Say there is a role valued between $50,000-$70,000, and a candidate says they are currently making $50,000. Expecting to make an offer at $55,000 and have them accept is not always realistic anymore. Today, that person is getting counter-offered to stay at $60,000 and if they are not, you should be wary.
The best way to have this conversation is to be transparent. The “new school” of thought is equal pay for equal work. The idea behind this is to pay candidates equitably for the work they are doing with less emphasis on experience. In some roles, more experience does not always mean better talent.
People want to be paid fairly for the work they are doing. The pay differentials today are smaller between experience levels. The best jumping off point is to simply ask candidates honestly and openly what they are looking for. If it can be met, meet it. If it can be beat, beat it.
As with any other asset, the cost of talent is not always what the interviewer values it at. Market conditions – along with many other factors – affect perceived value.
Ryan Joseph is an Executive Recruiter for Recruit Group (https://recruitgrp.com), with a focus on security industry operations, sales, and sales leadership. For help with your security recruiting efforts, contact her at [email protected] or call (954) 278-8286.
