Providing pay transparency

Over the last decade, organizations have made a dangerous shift in hiring practices: as the job market becomes tighter, new job postings no longer provide the full details about a position. This leads to a damaging spiral for organizations.

Consider the issue of pay transparency, where job postings rarely contain the expected pay range for a position. Instead, organizations post a very broad pay range—typically the minimum and maximum pay for anyone in that job code, anywhere in the company. This is quite a disparate range, from new hires who have yet to prove themselves, to experienced staff with decades of experience in that field.

Let's use a simplified scenario without a specific job title. Assume the organization posts a new position with a broad pay scale from $50,000 to $100,000. That's a big range, but it reflects new hires and experienced staff. You get lots of applicants for the position, which is good. You filter through the resumes, and HR performs the screening interviews. But it's not until the first in-person interview with a hiring manager that the candidate first gets to learn about the pay range.

During the "any questions for us" phase of the interview, you might hear this exchange:

• "What is the pay range for this position?"
• you: "We're looking to hire someone at around $50,000."
• "But I'm currently earning $70,000 and was looking for a bump when I made the move. I have the skills to back it up."
• you: "We're hiring for $50,000."

You get to the same endpoint if you skip posting the pay range at all, if that's a practice allowed in your state. In that case, applicants have to make a guess about the compensation based on the skills you're asking for in the job posting. At the first in-person interview, you'll have the same conversation where the applicant was looking for more than you were expecting to pay.

In both scenarios, you've wasted their time and yours, because those candidates will just remove themselves from consideration. And along the way, you've probably screened out dozens of qualified candidates in favor of the candidate who expected to earn more than you could offer. In the worst case (and unfortunately, an all-too-common scenario) you have to start over in the search process.

I encourage organizations to provide the actual pay range up front. Be transparent about what salary you will offer, and what benefits you provide. An article from earlier this year about pay transparency laws by state provides the same advice, although in a more roundabout way, writing "For example if one state has no pay transparency laws, another requires disclosure of pay ranges by the time of the first interview, and another requires that employers post the pay in the job ad, posting the pay complies with all three state laws."

The article also lists pay transparency laws in several states. For Minnesota, where many of my clients operate, the article highlights the 2025 pay transparency law:

Effective January 1, 2025, Minnesota's pay transparency law requires employers with 30 or more employees in Minnesota to provide salary ranges and general descriptions of benefits in job postings. Specifically, qualifying employers must disclose "in each posting for each job opening with the employer the starting salary range, and a general description of all of the benefits and other compensation…." Employers may also list a fixed pay rate.