I’ve always worked in blue collar occupation, mostly union shops. Everyone always knows how much money everyone else makes. I’ve always found it interesting, and amazing, that, among white collar workers, it is possible to work next to someone for decades, share intimate details of one’s life and never, never, discuss salaries. It’s considered a real faux pas. Why should this be so? Did bosses create this fashion to keep people from comparing notes and thus demanding more money? Do people think that those who make less than them would create a fuss which would result in downward pressure on their salaries? What?
I’ve worked in the white collar world for 16 years. Most white collar employers (or any non-union employers) want to pay people according to their value - so the more productive people have an opportunity to make more money, and are therefore more likely to stay around.
So with these employers, you have people doing the same kind of job, but making different salaries. If everyone knew what everyone else was making, you’d basically have (N-1) disgruntled employees - the only happy one would be the one at the top of the pay scale. Disgruntled employees don’t make good workers.
I generally have an idea who is making more than me, but I can’t do the resentment-building comparisons like “Joe makes $2k more than me and I think I’m as good as he is.” If I want more money, I can just do more/better work and make sure it’s noticed.
yes. In the white collar world people with vastly different job skills work side by side. Someone I work with once asked me in a casual off handed way how much I made. I told him. It turned out that I maded about 25% more than him, and he had been working for the company about 20 years longer than me. He was very upset, and went to the boss about it. I got in lots of trouble for discussing pay on the job.
FWIW I had many more job skils and qualifications thant this person, but he was still very angry. This was about 10 years ago and he still wont speak to me.
michael
However it started, it sure is pervasive. As a cow-orker once put it, asking another guy how much he makes is like suggesting going into the restroom and comparing dicks. You may extend the analogy in whatever way you wish for women.
Another curious feature is the way it extends to stock options, which for those of us in high tech, is often where the real money comes from. People will casually mention the option price they have, but NOT the size of their grants. Note that when you talk about disparity, stock options REALLY crank it up - the fact that somebody hired in a year earlier, or came in with a startup that got acquired results in enormous differences.
One white collar area where the aversion to revealing salaries is untrue - the law. I work for a good-sized New York law firm, and I know (or could find out) precisely how much every other associate is making, as well as get a very good idea of how much the partners are making. Even bonuses are given on objective criteria, so I can find them out too. The same openness about salaries exists at most every other firm I’m aware of.
I think the reason for the openness in the legal profession is because the ultimate reward for good work is partnership, and because it’s expected that the majority of attorneys will have moved on to another job within 3-5 years. So, while your waiting for the reward of partnership or for the “suggestion” that it’s time to move on, it makes sense to keep things collegial by paying everyone with the same experience the same, and making sure everyone knows that.
V.
Another area co-workers’ salaries are known is civil service. My first job (in my profession) was for LA state civil service. If you knew someone’s title and how long they had been warming their chair, you could determine their salary.
In my job (commercial real estate) and in law and stock brokerage and related fields where work is tied more or less directly to income you can find out practically any other person’s income (in the same company) just by being aware of their sales/billable hours/transactions or simply listening to them talk about it if they are successful and have a few drinks in them.
Income status being “secret” is generally relegated to non-governmental, white collar professions where the work is not directly tied to production of income. Because technical skill, productivity (however measured) , education or often the specific “deal” the employee worked out re geting hired can vary so widely a complicit silence is often the best policy to prevent turmoil.
Sua, at your lawfirm, you can find out the pay of associates, but can you find the pay of partners? … I’d bet not.
My firm consults with large companies on how to compensate employees, and, generally speaking, I’d agree with what most everyone has said so far. In the U.S., we’re talking about, of course, since different countries have different customs/cultures.
If the pay scale is one that is based on purely objective and fairly rigid criteria, like seniority, job title or grade, etc, then usually management sees little or no reason for secretiveness. Thus, there tends to be no secrecy in civil service or hourly-paid jobs, or commission-related jobs, etc.
On the other hand, as noted, if salary is based on some perceived performance criteria or “value” of the position and the person in the position, then the results of learning that others are paid more than you can only lead to dissatisfaction.
In the best companies, information about HOW pay is decided is often available, so that employees can understand where they stand in general relative to their peers, and what their future prospects are. The best companies to work for are companies that communicate to their employees. It would be rare for them to communicate details of another employee’s situation, as noted, but they might communicate broad descriptions of the decision-making process.
A man and a woman are on a date.
He asks her her breast size. She asks him his penis size. They are reluctant to reveal these measurements. Why? Because they are both measures of one’s “worth” and to reveal it would be to leave one vulnerable, so to speak…
“Hmmm, if I tell her it’s 6 inches, she might think that’s too small. What if I tell her it’s 8? She might think it’s too big…”
“Jeez, he’s looking right at them, I can’t tell him they’re a C cup, he’ll know I’m lying. I’ll tell him they’re 34B. I hope he doesn’t think that’s too small…”
The same priniciple can be applied to asking what one’s income is. There is no set amount that is ideal to reveal. Whatever the response is, it will always be judged.
That’s the biggest fear – being judged.
Maybe I’m cynical, but the corporate policy of keeping salaries a secret may also be fostered by executives who don’t want it to become common knowledge how disparate salaries are between middle and senior management.
I work in civil service. Salaries are all a matter of public record. In the department I work for, the salary of the highest paid employee (our Commissioner) is less than ten times what a new employee would start at. So the maximum salary “disparity” of our department is less than ten to one. If you take the entire state, the maximum disparity may be approximately twenty to one (ie the Governor makes approx twenty times as much as the janitor who cleans the thruway restrooms).
I doubt there’s many corporations that can claim that narrow a disparity. So my guess is that the policy of keeping salaries secret is designed not so much to prevent someone saying “Bill makes 25% more than I do and I’m going to complain to my boss” as “Mr Jones makes 425,675% more than I do and I’m going to become a Marxist.”
Well, note that the total compensation of the five highest paid positions must be disclosed, under SEC rules, for companies that are publicly traded.
Especially among high-tech workers it is very seldom discused. Technically it is against policy to talk about it, and very few people will give out the number. I think the main reason for that is the huge disparity of salary ranges among people working side by side. A programmer who has been working with the same company for 15 years might be 20% behind a kid fresh out of college, but got oracle database experience at an internship. Plus the fact that people who are hired together for the exact same job, with the exact same experience might be far apart on salary simply becuase one asked for more than the other, and they were both under the amount the company had allocated. Everybody knows that the salaries are different, and I think most people have a natural self-confidence and assume that the one who is higher than the others is themseles. And basically they don’t want to say, cause everybody might get jealous and start to resent them.
A most interesting and intellegent discussion. Question: If I raise questions with the boss regarding the legality or propriety of his or her employment, environmental, ethical, or health and safety practices, am I likely to be regarded as “valuable” and get the same raises and perks as my co-worker, who has comparable or maybe slightly inferior skills, and who is constantly flattering the boss’ ego and telling him stuff like, “That Galen should stop pestering you with all these questions. Doesn’t he know you are the best boss in the world?”
What I find interesting is all this talk that it is against policy to speak of salaries. In case anyone didn’t know that is against the LAW. You’re employer can not prevent you or reprimand you from telling what you make to anyone. If anyone has gotten in trouble for this, I recomend that you go and report your employer. On the question Galen asked, it is a god way to keep salaries down. If I’m making $8 an hour and think that’s an ok wage, and they bring in someone making $9.50, I’m not going to complain if I don’t know what they make.
I live with a couple of folks who give some pretty interesting examples of salary disclosure in a tight-lipped environment.
One guy is a shit-hot construction estimator. His company’s competitors are constantly trying to lure him away, and every time one does he casually mentions it to his boss. Zap! Another raise. Recently, he got a few drinks in his boss while on a company trip and discovered that he makes $15,000 more per year than the next highest paid estimator. Although he feels he is worth what he gets, he’s very concerned about what will happen once his co-workers find out, and I think he is putting even more pressure on himself to outperform his fellow employees.
My other housemate was until recently in the book publishing industry. She worked for a small agency with some big-barrel clients. After a year at that agency (and two years at another agency, and a couple of years as a journalist), the agent-in-charge hired another person of the same age with less experience to do the exact same job she was doing. She befriended him and eventually they compared salaries. He was making ten thousand a year more than she. They both believed that the disparity was largely based on gender, both were disgusted by it (and a Christmas list of other vile business practices), and both split within six months of finding out. They left the agency in quite a bit of a lurch by taking other, better, jobs at roughly the same time–and good riddance, in my opinion.
Seems contrary to common sense.
Sounds like your boss is incapable of rewarding honesty and true porductivity. Why didn’t you quit right then and there?
Sounds to me like you, your aforementioned co-worker and most probably everybody else even remotely connected with this sorry and sad excuse for a corporation sold out a long time ago. I’ll bet that your company doesn’t even pay it’s fair share of taxes either. How much unnecessary and redundant research goes on where you work? Probably the vast majority.
Here in the MBA world, it is unfortunately the case that starting salary is directly proportional to what school you went to in addition to your years of experience. The sad truth is though that the smartest people who went to a poorly ranked school will still make far less money than the dumbest asshole who comes out of Harvard.
We have a guy here who just resigned when he found out how much less he was getting paid relative to the rest of his group. Of course, the company tries to keep our salaries a secret, except that everyone sees what rates we bill our clients per consultant, knows what our mark-up is for profit and overhead, and can do the subtraction to figure out the base rate and extrapolate that out to a yearly salary figure.
We may be MBAs, but were not THAT stupid you know…
It is a basic principle of market economics that the advantage goes to the party with the most information. As long as the employer knows what every employee is paid but the employee knows only what she is paid (or offered), the company has the advantage in negotiations. I don’t think there is anything especially sinister about it. Car dealers do exactly the same thing. Next time you go shopping for a new car, try asking the dealer what her cost was. Better yet, ask her to tell you what last five customers who bought cars similar to what you want ended up paying.
If employees want to level the playing field in one of those
industries where salary information is known only to employers, they just have to ask one another. However, as pointed out by others, salaries are VERY sensitive. One measure of the sensitivity of salaries to Americans is how questionnaires are designd for surveys of sensitive behaviors (e.g., sex). In such surveys the most sensitive questions are left for last, after the interviewer is supposed to have built up some rapport with the respondent by asking less sensitive questions (e.g., Where were you born? How many children do you have?). Guess what kinds of questions are left for last: How many people other than your husband did you have sex with in the last month? How much do you make?
Wow…great insights to alot of questions I had.Let me share something that I find funny.
I’m in a union shop,but have worked non union also.Blue collar (operating enginners union).I work in a very large building in the corporate sector.The building is a million plus square feet and employs over 7 thousand people.
I wear a basic work uniform…denim shirt and “dickies” style pants. I have found that the “white collar” workers in the building kind of look down their noses at the uniformed service personel.
Through the course of the years,I’ve found that I make more money than half the “white collar” workers make.((excluding senior VP’s…etc)). I always wondered If they’d look down their noses at me if they knew I made nearly six figures last year.
Rich G7 subs: I don’t think they are looking down their noses at you, personally. I think that they assume that guys dressed like you make anywhere from “nearly six figures” to minimum wage (compared with six figures to five figures for blue collar workers) but that the “typical” person dressed like you makes less and is less well educated than the “typical” white collar worker. Not that anyone should look down their nose at someone just becuase they assume that the person probably is makes less and is less well educated than they are, but it happens.