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Helping employers embrace wage transparency
Editorial by Christian Saint Cyr
National Director / Canadian Job Development Network
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Listing wages in job advertisements is now the law in both British Columbia and Ontario, so employers are technically required to post wages or wage ranges in both provinces. Nevertheless, for everyone in Canada, being transparent about pay is a fantastic way to take wages off the table and help prospective employees see the intangible benefits of working for one employer over another.
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Between provincial legislation and the fact that job postings with wage information attract more applications, wage disclosure has grown rapidly in the last few years. Almost half (49%) of Canadian job postings on Indeed in February 2024 featured pay information, up from 22% in early 2019.
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A few years ago, I conducted a salary survey for the career development sector. I explored the average salary for a number of career development roles as well as how salaries differ based on region.
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In launching this survey, I received a concerned email from the owner of a career development organization arguing that I shouldn’t do the survey. Their argument was that in revealing wages for the sector, I would make people feel bad if their wage was lower than the industry average.
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At the time, I felt this concern was primarily one for organizations that were paying their workers lower than the average. This was true in smaller and more rural communities where career development organizations didn’t need to compete with many other organizations for skilled staff.
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It’s not so much that this would have made staff feel bad but helped people realize they are being paid below the industry average. Due to how employment contracts are tendered, this employer may not have been able to do anything about it.
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Let’s be honest, there are lots of ways employees can learn about prevailing wages. LinkedIn, Glass Door and the Canada Job Bank itself, not only lists wages, but breaks them down for every region of Canada. I was trying to bring clarity to the wage differential between job developers, case managers and resource room facilitators.
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Nevertheless, this career development employer’s concern is not too different than the concerns of employers in all other sectors. For many employers, their number one cost is wages. The rapid rise of inflation in recent years, coupled with increasing minimum wages across the country, has left employers struggling to compete. Wages are an area of potential control.
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Employers have tried to keep wages secret to avoid giving existing workers raises and to mask the fact that women, new immigrants, racialized Canadians, those with disabilities and Indigenous workers are earning less than their counterparts in the same workplace.
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In fact, when I conducted my salary survey, I discovered that career professionals hired in the last two years were typically making a little more than the employees who had been working two to four years.
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While wage information has become more common, it’s also becoming less precise as employers try to tailor the information to suit their needs. According to Indeed Hiring Lab, five years ago, the average salary range was about 10% of a jobs wage and today the spread is 18%. Employers are wanting to post a greater wage range to be able to negotiate a higher wage for more qualified workers and retain a lower wage for the less qualified candidate.
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In fact, the number of employers willing to state a specific wage is down considerably from a few years ago. In 2019, 40% of job postings with wages listed included a specific wage and this has now dropped to just 21% of postings.
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Promoting wage transparency is a win for job seekers but also for employers. According to Randstad Canada, about 51% of job seekers are less likely to send in a job application for a position that doesn't set salary expectations.
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In discussing wage transparency with employers, it’s important to provide an unbiased case. There are benefits and challenges that go along with this level of accountability. The following is a pro and con list prepared by LinkedIn for employers considering Pay Transparency.
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Pros:
- Attracting more talent
- Increasing recruiter productivity
- Providing a better candidate experience
- Increasing employee trust and retention
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Cons:
- Reducing candidate pools
- Causing workforce envy
- Difficulty negotiating pay
- Poaching employees
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It is valuable for employers to understand that for good or for bad, they have a ‘relationship’ with their each of their employees. It’s nice to say that we have a contract or it’s just business, but when you cloak your practices in secrecy and treat some employees better than others, you are damaging this relationship.
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Employees regularly talk about wages, benefits and all of the decisions employers make and yet rarely talk about them with employers themselves. In the 21st century, there is very little that binds an employer to an employee and the reverse.
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The only way for an employer to build a conscientious, loyal workforce is to adopt practices that make their employees feel respected, appreciated and rewarded. Employers need to make the same effort to build their relationship with their employees just as they would nurture any other relationship in their life.
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While Ontario has yet to confirm what date wages will be required in job postings, the British Columbia example is eye-opening. According to Indeed Hiring Lab, prior to November 1st, 2023, when wage disclosure became required, 49% of job postings in the province listed a wage. This jumped to 76% as of February 2024.
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As we walk employers through these transitions, it’s valuable to help employers promote the intangible elements they bring to their employees.
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When I’m advising employers, I encourage them to adopt a wage that is representative of the sector. I also advise them to be fair in their wage distribution. Not that an employer will be sharing what employee A is making versus employee B. This said, if these employees were talking about their wages, would this employer be able to justify why they pay one employee more than the other based on qualifications, skills, ability and experience?
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Taking wages off the table can be extremely liberating for an employer. Paying an industry average allows an employer to market their organization based on the key benefits they provide such as hybrid work, workplace perks, discounts, time-off, flex-time, flexible schedules, remote work, etc.
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In job development, one of our crucial roles is to identify and emerging trends and help employers make the most of them. Likely, you’ll encounter employers who stress they can’t change their wages in which case your conversation can focus more on how you can promote them as an employer that values their employees, provides unique benefits and where individuals can grow in their profession.
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We’ll be discussing the benefits of wage transparency at our #MotivatingMondays meeting of the Canadian Job Development Network, Monday April 15th at 8:30am Pacific; 9:30am Mountain; 10:30am Central; 11:30am Eastern; 12:30pm Atlantic and at 1pm in Newfoundland. Visit: www.MotivatingMondays.ca on Monday to join the session LIVE.
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