I don't understand how you can have a labor market where only one side has information on what the salaries are for an industry through a team that does market research. It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs.
Price transparency leads to more efficient markets, no reason the labor market is any different. A company hiring an employee under market rate, because the employee doesn't know what market rate is, is a failure.
EDIT: Wanted to add that this hits closer to home for me b/c I've personally experienced this.
Went out and jumped companies and got a 300% raise b/c I was underpaid at the prev, only know that thanks to levels.fyi. New hires at my level were making almost double what I was.
When other engineers at my current company talk about salary, or total comp more generally, they vastly underestimate the state of the market.
>It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs.
It is just wild to me that this is where society landed. Imagine you are a business owner. Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term? These are people who know your industry, your business, your customers, and your product. They are your institutional knowledge. They are drastically more valuable than a new hire who has to spend years learning this all. But instead of rewarding that loyalty, we use it to squeeze out an extra few dollars of profit regardless of the consequences. It is bizarre.
If I had to guess, I'd imagine this is the result of perverse incentives combined with the Peter principle. Consider a manager or corporate recruiter receiving a bonus for keeping down costs.
>If I had to guess, I'd imagine this is the result of perverse incentives
I think it is simply short term profit maximalization. Why give an employee a dollar more than you have to give them? Whether giving them an extra dollar now might generate an extra two dollars down the road is rarely even considered.
> Wouldn't employees who are loyal and happy to come to work be the exact people you want to keep long term?
You do, but you can achieve this by one of 2 ways: frequently adjusting salaries to match market rates, or rely on momentum, and hide information from them by strongly discouraging salary discussions among employees[1]. The latter approach results in more profits.
1. but sharing this information with fellow employers behind paywalls, like the work number.
What is the interview process like at your company if you think that is a better evaluation of an employee's ability to do their job compared to act of actually doing that job?
I worked for a software company many years ago that also operated call centers for customers who didn’t want to run their own.
My colleague was an immigrant who had moved up the ranks from a call center agent to a senior technical role.
I found out when fixing a technical problem that she made $25k, while I made $65k. Basically, they gave her a 25% raise from a call center supervisor to be a Unix SA, and in lieu of raises “gave” her comp time for 24x7 on-call.
Pay transparency is great for business owners and other large employers. It makes it much easier to compress pay.
> Recent decades have witnessed a growing focus on two distinct income patterns: persistent pay inequity, particularly a gender pay gap, and growing pay inequality. Pay transparency is widely advanced as a remedy for both. Yet we know little about the systemic influence of this policy on the evolution of pay practices within organizations. To address this void, we assemble a dataset combining detailed performance, demographic and salary data for approximately 100,000 US academics between 1997 and 2017. We then exploit staggered shocks to wage transparency to explore how this change reshapes pay practices. We find evidence that pay transparency causes significant increases in both the equity and equality of pay, and significant and sizeable reductions in the link between pay and individually measured performance.
Because they screw people over. See my other comment in the thread.
I spent most of my career as a public employee, most years salary are searchable on the internet. It’s nice because it eliminates a lot of drama about salary, who has what formal title, etc.
When I was in sales, the smart salespeople were following their peer/competitors performance. The notion that “professionals” are above such things as compensation is just stupid.
Then those of us able to get more might be pushed into taking the risk of making our own company and competing against the major players who are currently controlling the market by paying more than God to keep talent focused on selling ads instead of creating value?
Also with all the talk of racism and sexism in the work place , especially by the Big Tech companies, they should have done this long ago.
Well they would have if they had truly cared about minorities versus creating a bigger labor pool to drop pay rates or create faux PR for their companies and industries.
Yes, the biggest impact will be on cheap companies who relied on a candidate’s ignorance of their worth. We don’t even need most states to pass bills like this (would be nice though). We just need some of them and the cat’s out of the bag.
Snark aside, yeah levels.fyi does have data and so do other sites. (Although levels is the standard in tech imo).
Still is incorrect though, b/c those sites are biased against older consistent data vs new data.
Example:
Look at averages for FAANG engineers that are poached from other companies, vs ones with years at that company. If you just looked at the average then it wouldn't work since you're a new applicant you should probably ask for 20-30% more than if you currently worked there.
Also saying Google/Levels is good enough puts aside the problem of what market rate is for smaller companies. How much should a well funded web3 company pay you? What about companies outside of tech where salary sharing is less common?
All of the info available to the candidate on Google also pales in comparison to the asymmetry of one person versus an entire department of people who make these deals for a living, and have actual research on what's going on with the market instead of randomly reported crowdsourced data.
We now apparently live in a bizzaro fantasy world where legislation is required to spare people the discomfort of negotiating a salary or asking for a raise. If a company offered to pay you X and you agreed, whose fault is this?
We used to call dealing with these kinds of situations "being an adult."
> If a company offered to pay you X and you agreed, whose fault is this?
If you were forced to trade stocks for a living but had only second-hand access to price information ("My cousin bought some TSLA at $200/share last year") while all the brokerages share order flows in real time, would you say you're getting hosed? Or that it's a fair market?
For example, I played poker when I was younger. I routinely did much worse than mathematically expected. I suspect I was being cheated by the other players, but I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker.
I know that when I trade stocks, I'm getting chiseled. So I don't day trade. I buy and hold, and rarely make a trade. Hence, the chiseling doesn't amount to much.
It's an analogy. "Trading stocks" is an analogy for "negotiating salary". Nearly everyone has to negotiate salary.
> I wasn't savvy enough to know how they were cheating me. My solution was to stop playing poker.
So you're saying people's options are to a) be cheated on salary or b) not work in paid employment? I respect that you have an opinion, but it's not an opinion that I have any respect for.
> Hence, the chiseling doesn't amount to much
Because we have open price sharing today and it's not possible to cheat you too much. You're benefiting from this even though you don't day trade. If we didn't have that, you and every other buy-and-holder would be shafted severely.
Sidenote: I notice in many of your posts that you're a big proponent of free markets (which I mostly agree with). How do you square that belief with this one where one party, by design, has far less market information than the other? I'm genuinely curious about this, because it seems contradictory.
(And yes, you might say "Companies choosing to share/not share salary is actually them competing on a free market", but that's an awfully limited viewpoint when we have other markets where prices are required to be open - such as real estate, and securities - without there being any suggestion that they aren't free markets)
Negotiating is not "forced". Forced is the word you used. It is inapplicable and so your analogy simply doesn't follow.
> So you're saying
No, I'm not. I was pretty clear on what I said. You don't need to invent positions.
> every other buy-and-holder would be shafted severely.
Then the market wouldn't exist, and the market makers would either have to be more transparent about the price or find another business to be in.
> How do you square that belief with this one where one party, by design, has far less market information than the other?
People often have the notion that a functioning free market requires perfect information. I don't know where this notion comes from. But it is clearly false. One never has perfect information. In the marketplace, this lack of information is called "risk". The amount of risk is always factored into the price.
That's why, for example, you'll pay more for a car from a dealer than from a private party. You're paying more for less of a risk. If you're investing, you expect higher returns for riskier investments, and lower returns for "safer" investments.
Me (and you) will negotiate for a higher salary for a riskier job, and would accept a lower salary for a more reliable job. A company will offer a lower salary for a riskier employee.
Again, lack of information is called "risk" and is part of the price of everything you buy and sell.
Other than starting their own business (which most people don't or can't do), how else do you propose people earn livelihoods?
> People often have the notion that a functioning free market requires perfect information
I didn't say "perfect information". Institutional investors have access to snap quotes accurate to a few milliseconds. Retail investors get delayed information. Information asymmetry is a spectrum. The stock market is on one end, and the job market is close to the other end (I can only think of healthcare pricing in the US that's worse than that).
Risk only matters when comparing two otherwise-similar employees. Otherwise supply and demand are the dominant factors in pricing. Hiring someone to make sandwiches is very low risk (you can easily verify that they make good sandwiches) compared to hiring a software developer (any interview process gives imperfect signal). And yet the sandwich artist gets paid less than the developer.
I ask you again: would you participate in a real estate market where you could only find out prices by asking friends and family, while the other side (let's say all institutional sellers) can share lots of information with each other? Would you invest in a stock market like that? Would it be good for you? Would you think it's fair? What if it was the only way to obtain housing (short of building your own house)?
It's really weird that you're against legislation requiring market participants to receive more information. Perfect information isn't possible, but why is more information bad?
This exact same logic could be used to advocate against a minimum wage or really any employee protections.
If I am an adult agreeing to go to work in a sweatshop, why is the government stopping me? Because the government recognizes that I am only agreeing because the power imbalance my employer has over me is a form of coercion.
If you've ever been an employer, you'd know that you have exactly zero power over your employees. They can and do quit whenever it strikes their fancy. Employee turnover is a constant problem for every business. This applies to min wage workers on up to million dollar workers.
The only real difference is the million dollar ones give notice, and the min wage workers just stop showing up.
>If you've ever been an employer, you'd know that you have exactly zero power over your employees.
This is a statement totally disconnected from reality for most Americans. Over half of Americans live paycheck to paycheck. Over half of Americans get their medical insurance through their employer. These two facts mean that most Americans do not have the financial security to quit a job without having another one already lined up.
Googling crowdsourced data like levels.fyi or Glassdoor has way more noise and sampling bias than the data companies can buy from places like TWN by Equifax. Even if you had access to the same data, you don't have access to their business information so you have no good way of understanding what you would be worth or the value you are expected to generate.
An applicant has as much job-related gambling when they take a job as the employer, especially when the job can just fire you. When applying, you have no idea if the management is terrible, if your particular manager is terrible, if the projects you're going to work on are terrible, if the procedures and standards for working on a project within the organization are stupid or will penalize your style of work, if the job will have high expectations and skimp on resources, whether your new company sucks at hiring and all your coworkers are going to be terrible...
Calling it a crapshoot on both sides is a pretty empty statement. When it comes specifically to compensation, the applicant is David and the company is Goliath.
Employee compensation is based on the value they provide to the company. Equity owners are compensated for the risk they take. I don't see any essential correlation between the two.
For example, if you pay Bob $10 to go to the store and buy a lottery ticket for you, and you win the $1m jackpot, do you owe anything more to Bob than $10 worth of value he provided? Let's say the ticket was a dud. Do you therefore owe Bob less than the $10 you promised him?
Prices are a function of supply and demand, not “value”. I pay very little for very “valuable” life sustaining food because I can get it cheaper from multiple sellers.
Sure, and in order to correctly value something, you need to know the relatively real time price history to infer how supply and demand curves are moving.
Not having that information means you will ascribe the wrong value, which means society is not allocating resources properly.
Your example is not relevant to this conversation because we are not talking about retroactively changing negotiated prices.
Labor prices stagnating relative to equity owners’ gains has to do with supply of labor vastly increasing due to globalization, and simultaneously, automation reducing demand for many types of labor.
Having transparent prices will help better inform labor sellers which labor markets have excess supply and which need more labor, in a timely fashion.
Zaheer from Levels.fyi here. Note that companies struggle with data as well. There's dozens of companies that solely exist to provide better data to companies around salaries (Radford, OptionImpact, etc.). All of these have limitations as well (title matching, recency of data, etc.) and generally companies subscribe to multiple providers to get a better picture of what the market pays. Companies in fact purchase data from us as well (the same data you see on site but formatted in a way that's easier for comp analysts to use).
The reality is that there is tons of nuance that goes into pricing a job / candidate effectively. Each candidate has unique skills even if two candidates have the same title, level, etc. That's why it's almost never a fixed number and often a range.
Thank you for the context! I recently discovered that many employers share exact salary and level information with Equifax and assumed that those kinds of solutions were commonplace.
Also they have the money to buy information from various information aggregation companies which collect salary information from more reliable sources. They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc.
> It is well known that companies often collude with each other and engage in "salary fixing".
That has nothing to do with the topic at hand, which is the candidate doing some research to get a feel for salary ranges.
> They do not have to rely on (inherently unreliable) self reported figures from glassdoor etc.
Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate, because the price you actually get is dependent on the individual characteristics of your car, and how much the other party needs to buy it, and how much you need to sell it.
The fact is, if you're going in blind to deal for a car, or a job, you're shooting yourself in the foot. Information isn't hard to come by for either. You don't need the government to hold your hand.
I believe the topic being discussed is asymmetry of information between employees and employers (with respect to salary). Salary fixing demonstrates this asymmetry pretty well, so it is on topic.
> Salary figures are inherently inaccurate, just like googling for the market price of your car can never be accurate,
I don't think this has got anything to do with the topic under discussion.
> Information isn't hard to come by for either.
I disagree. IMO it is harder to come by for individuals than large companies. I have explained why in my previous response.
As a candidate, I hate applying to jobs only to get a lowball offer at the end. So I appreciate bills like this.
As a hiring manager, I see that this is actually not so simple. You give someone a range, say $100-150k. I ASSURE you that they are thinking they are closer to 150k than 100. So good luck giving an offer for $100k, even though that might be what that particular candidate is worth to you.
It's never gonna happen, but what i'd rather see is an option to instead give current median total comp on the team i'm interviewing for, plus maybe the 25-75 percentile range. That gives me a sense of what I should expect, plus what the salary growth path might be.
A 50% difference in salary sounds like a slightly different role / level with different expectations. Why not put up two job postings, one for 90-110k for the junior devs and one for the senior devs at 140k-160k? Why are you dangling 150k in front of junior devs if they aren't worth it to your company in the first place?
If they are the same role and the difference really is 50k based on interviews and negotiations alone I am of course going to shoot for the full 50k.
If you want to low ball, why not just always post a full range and hit every candidate with "we're not sure you're a fit but we do have another position at $50k less"?
If you need them but they won't apply for less than 150k, I think the problem is not that your range is 100-150k making them negotiate for 150k, it's that the market rate has gone up to 150k. If it is worth around 100k to you with handholding put a range closer to 100k in the description, and a separate job posting with all the additional requirements to make it to 150k, imo.
For a small company, just having one job posting is a lot of work, let alone managing multiple postings. Hell, there are times where we're hiring for a high level position but if a $30k resource walks in the door we might still hire them.
Also, it is hard to come up with "particular requirements" that makes someone worth that extra $50k. Sometimes it comes down to a risk/reward calculation you have to do on the spot.
Hiring sucks and as much as I'd love to have some great A + B = $100k, A + B + C = $150k formula, there's just too many factors, especially in a small business.
While I can see reason, sometimes is sufficient to have the same job posting with "junior", "intermediate" and "senior" in the title as differentiator.
Sometimes it's not so much the same role, but you need someone to work on X and do the other things; depending on experience and interview, the compensation and the other things will vary, but you're not going to hire more than one person to work on X, so having two open positions will confuse HR.
Now that these laws are passing, HR will have incentives to correct this kind of situations. It might be as simple as having one job posting with pay bands associate with levels. So having a single job posting with Levels 1,2,3,... and the expectations/salary bands for each. That way, candidates asking for top-of-band should expect to be interviewed at the appropriate level.
I feel like a lot of companies already do this: interview candidates, then grade them at a specific level based on their performance.
> Why are you hiring a $150k candidate to work on X if a $100k candidate can work on X? That's a waste of $50k.
i think that’s the point. X takes an engineer who’s worth $100k. if an engineer worth more than that comes along, you want to let them do X for $100k, but since they’ll get it done easier/faster either you’re only letting them work part time (silly restriction to force on them), or you let them help out around the org in general for extra money. hence, you advertise the role as $100k (for doing X) - $150k (a rough judgment of how much extra capacity the company could easily absorb from a candidate that tackles X quickly).
Or you could just give the more qualified person a different title/level since they are clearly in a different role. A role that might be superset of role x, but a different role nonetheless.
This is how the US Federal Government does it, with 15 'levels' (Paygrade) and 10 'levels' within each grade (Steps). Salaries scale up by 20-30% by Step, and a GS-1 step 10 makes more than a GS-3 step 1.
> The General Schedule (GS) payscale is the federal government payscale used to determine the salaries of over 70% of federal civilian employees. An employee's base pay depends on two factors - the GS Paygrade of their job, and the Paygrade Step they have achieved (depending on seniority or performance).
The job's pay grade range (from step 1 lowest to step 10 highest) is what would be published to comply with Washington's laws. What's missing in the private sector is, at most employers, any communication whatsoever on which 'step' one is at; while HR often has this data, it is almost universally withheld except upon request, and often gated behind an HR conversation and verbal-only replies.
"absorb from a candidate that tackles X quickly" sounds a lot like "waste" to me.
The fact is, if X can be done by a $100k candidate, and you're hiring a $150k candidate, you probably expect more than X of them, and those extra expectations need to be communicated.
> Why are you hiring a $150k candidate to work on X if a $100k candidate can work on X?
Because the world isn't black and white. There could be soooo many different reasons why you're willing to pay one person a lot more than someone else to do a job.
I mean, the ones that come to my mind are variations on the market rate being closer to $150k and you are trying to get a deal lowballing people. Which of course every business is going to do, I don't think they are wrong to negotiate down, but I think being upfront about the range is more honest to candidates and results in a better hiring experience for the hiring company overall.
Forcing them to be upfront about the requirements for more money results in candidates better aligned with the requirements I would think. And leaving that to some negotiation without those requirements seems like it just opens the door for bias. I want to hire engineers and keep them based on their qualifications, and negotiating abilities is usually not one of them.
There are soooo many different reasons why that's wrong, but since you're just claiming that there are reasons without bothering to share any of them, I guess I can do the same.
The fact is, if there are reasons you're paying one candidate more than another, those reasons don't need to be secrets.
Because if you can get a $150k candidate, they'll work on X and Z, but a $100k candidate may only work on X and Y or maybe just only X. Y and Z are nice to have, but only X is worth hiring for; whichever candidate gets through first gets the position.
So post 2 positions. If Z is worth 50% more to you, then it's clearly a different position, even if the responsibilities are a superset of the lower position. Most companies have levels for exactly this reason.
It's not hard to post 2 positions, and it prevents issues like many people have been bringing up with candidates having the wrong expectations.
Posting a "$100k-$150k for X" position completely fails to communicate this. Intentional or not, this comes across as either you don't know what you want, or you're trying to sneak in extra responsibilities to the position without having to pay for them.
And I'll reiterate: $50k is a lot to pay for a "nice to have".
I'd say you need to really think about whether you need Y and Z. If you don't, just post a "$100k for X" position. If you do, post a "$150k for X, Y, and Z" position". If you must, post both--at least that's honest. But it would be better to come to a firmer conclusion about what you need before hiring.
I haven't worked with HR at small companies before, so maybe this is completely out of touch, but why would it be so hard for HR to handle two postings for the same rec/headcount? They already presumably have this problem with multiple postings on different platforms? And if they can't handle that to avoid the effects of large ranges on negotiations then the effects must not be worth that much to the company.
> You give someone a range, say $100-150k. I ASSURE you that they are thinking they are closer to 150k than 100. So good luck giving an offer for $100k, even though that might be what that particular candidate is worth to you.
This comes across as whining that you won't enjoy the same unfair advantage in negotiation as you previously enjoyed. Interviewees are almost universally expected to give a single number (not a range), sometimes in the application process, even before the interview. If I can put a single number on what I'm looking to be paid with incomplete information about the position, you can put a single number on what you're willing to pay with incomplete information about the candidate.
Also, a range as broad as $100-150k tells me that you either don't know what candidate you're looking for, or you're trying to snag a $150k candidate and only pay them $100k. There's no way I'd apply for that job as anything other than the lower end of that range.
A healthy business relationship starts from understanding that both interviewer and interviewee should have the same goal, trying to match an appropriate candidate with appropriate work and appropriate pay.
> If I can put a single number on what I'm looking to be paid with incomplete information about the position, you can put a single number on what you're willing to pay with incomplete information about the candidate.
To be fair, that's not true. One person interviewing can say what number will make them happy to consider a move.
The company though, is open (usually) to all kinds of people who might fill the role. These people may range from a recent graduate to someone with tons of experience. Just depends who shows up and how good of a match they are. Open positions are hardly ever so statically fixed, there's always room to make the scope (and pay) smaller or larger, depending who shows up.
Software roles are fairly open-ended on what the person will ultimately end up doing, so it'll depend on their experience and interests. It's not like hiring someone for a widget factory where I know in advance they'll be stamping widgets 8 hours a day. In such cases, the pay can be predicted easily.
> Interviewees are almost universally expected to give a single number (not a range), sometimes in the application process, even before the interview.
I think a better description of the situation is "prompted" or "demanded", not "expected". As many interviewing advice sites will happily point out, providing any salary information prior to an offer is not usually a hard requirement (though employers like to make it seem like it is).
If your range is that wide commiserate with experience, what are you even shopping for? All this bill asks is for hiring managers to be less flippant about what they are buying when they are entering the job market and shopping for talent. If they are wanting a candidate with experience they value at $150k, then put that as the posted salary. If they can get away with a candidate with experience they value at $100k, put that as the posted salary. If you want both candidates, post both listings. If you only want one of the two, take the other listing down when you have your first candidate. It seems simple to me.
But that approach means opening something like four job postings for every role (junior, mid, senior, principal) and suddenly closing the other three when you find someone. I don't know if this might fall foul of any job posting rules? Since basically three of the four postings are "fake" in the sense that you're only hiring one person. It's just that nobody knows ahead of time which of the four postings will end up being the real one.
Companies do this all the time. There’s generally no problem with it. We have an opening for an staff engineer at work, but we’d settle for a senior engineer.
We definitely wouldn’t hire an unqualified person as staff and just pay them less.
Or an overqualified person as senior and pay them way more. That just doesn’t make sense.
Companies also routinely have permanently open positions without exact numbers of positions.
I don't think you have to fully commit to hiring on every job posting you make. A lot of biotech jobs seem to have standing listing for these sorts of tiered roles (junior scientist I II III IIV, scientist I II III IV etc..) presumably because the applicants can be pretty stratified in biotech in experience and in degrees.
I'm the person hiring. I used to have this problem a lot and I solved it.
I started just deciding what the pay for the position would be in advance and posting it. I don't negotiate, if that comes up I say we give very aggressive raises and promotions to people who exceed expectations (which is true) but I understand if that's not something you can rely on. As an exercise in transparency we're posting the actual exact starting salary and this is what it is.
Feedback has been across the board positive. Presumably some people look at the pay and feel like it's slightly too low and we don't get them. That's fine, it's a reasonable tradeoff for eliminating the confusion and bad feelings created by not being transparent. There's nothing stopping us from posting a similar position as well (perhaps with a slightly more senior title) with slightly higher pay.
I think the whole kabuki dance of not telling people the actual comp is inefficient and pointless and I'm fine if it goes away.
See, I like good raises (10%+ per year). The main reason to start looking for new jobs is that 2% annual raises are quickly outpaced by the 10-20% increase in market wages.
Plus, I feel like jobs that give double-digit raises also have better processes in place for performance reviews. Places giving out 3% a year almost always just go through the motions on performance reviews, since each manager can only give out one or two "good" raises. Even if you did a great job, they are kind of forced to hand over their one 5 star review to the person who always gets them.
I guess you're saying that putting the 150k number in the candidates head is going to make the eventual 100k offer sound worse than it otherwise would have? Can't you have a conversation with the applicant, walk through your reasoning, explain their path to 150k in the company, and covert at least some percentage to candidates that accept? I would almost appreciate that more than believing that I'm being taken advantage of by a single number offer.
Totally agree. My first job out of college, there was a range for the position of $75 - $105k. I got the offer, and the salary offer was for 75. I asked for $90 and we settled on 85, as the 105 range was for 2+ years of experience, and I was a new grad. I thought it was very fair.
Almost literally me. Before I graduated, I applied for a job, got offered $80k, negotiated up to $90k, and have seen significant increases in salary since then. I’m being paid area-average salary for interesting work, great work-life balance, and insanely great non-monetary benefits.
Another job I applied to before graduating offered me $60k and told me I couldn’t negotiate. Guess who didn’t even bother responding to them?
Instead of having 1 role with such a huge gap. Why not multiple roles.
If you find a candidate who you really think is worth 50% more than the average salary for Role X, then obviously that candidate is qualified for Role X + 1.
It doesn't have to be that granular. If one engineer is getting (deservedly) paid 50% more than another in the same role, the company owes it to that engineer to give them a title/role that reflects their merit/contributions, at the very least for their career progression.
Why is that the logical conclusion? That doesn't make sense to me at all.
Internally managing that many positions and requirements and putting up that many job postings is a nightmare. For applicants, I'm going to almost immediately leave a page with that many listings and look at other companies.
It's only "logical" if you ignore all other pressures to job postings and are only trying to game these laws, which I presume have some baked-in preventions for this. I know Colorado's equivalent law does.
In most cases Microsoft hires software engineers for one of 9 levels: SDE, SDE2, and Senior all have 2 and principal has 3.
Those levels are the same for any engineering track (IC or manager).
There are some exceptions like vendors and partner+ positions, but those levels won’t overlap with the typical engineering job postings.
Within the context of Microsoft: we often interview people for a Senior role, find a good candidate and make an offer, while at the same time making an SDE2 offer to someone else who did well on the interview but doesn’t seem ready for senior. Since the SDE2 salary range will be different than Senior (there is some overlap), I wonder how that works with the law.
> You give someone a range, say $100-150k. I ASSURE you that they are thinking they are closer to 150k than 100. So good luck giving an offer for $100k, even though that might be what that particular candidate is worth to you.
This is exactly how markets are supposed to function. If you feel that a candidate isn't worth what they're asking for, then you have every right to pass on them. Keeping a lid on the salary range is a dark pattern that benefits employers at the expense of workers.
If your employees find out that there is a 50% difference in their salary's for the same official job title I suspect that they are going to be very upset, unless you've been open and clear with them up front. Shrink your salary bands and break this out into different jobs, as a suggestion.
Does everyone at your company with the same title create the same value? Plenty of people at my office with the same title create double or triple the value.
Yes those discrepancies exist. But they are almost always a result of imperfect information at hiring. No one hired 2 people into the same role assuming that one would only be half as productive as the average and one would be 2x more productive. Had they known that going in they would have hired them into different positions or at least different levels within the same position.
And typically those high performers either get promoted or leave to find higher paying jobs.
> As a hiring manager, I see that this is actually not so simple. You give someone a range, say $100-150k. I ASSURE you that they are thinking they are closer to 150k than 100. So good luck giving an offer for $100k, even though that might be what that particular candidate is worth to you.
This claim appears multiple times in this thread but it doesn't actually make sense to me. If I'm currently making $x and I see a job listed for $1.2x - $1.5x, I'm not going to turn down a 20% raise just because I wanted a 50% raise.
Perhaps you have to choose the number that best fits what you're prioritizing.
If you're looking for "entry-level", then perhaps "starting at $100k", but if you really need someone with the experience or skillset pre-loaded, "up to $150k".
> As a candidate, I hate applying to jobs only to get a lowball offer at the end. So I appreciate bills like this.
These bills are nice but I don't feel very strongly about it because whenever I talk to a recruiter, the very first conversation is where I'll give my comp expectations. If they want to proceed, great, if it's too much then fine.
Proceeding through interviews and waiting for an offer to see if they can match your expectations is not a good use of time.
Every single time I have ever given a range as a hiring manage, the candidate pictured themselves at the top end. But like you could have self taught 2 years of experience vs PhD and 12 years of experience for a similar position - there is no way everyone is at the same spot comp wise.
>2 years of experience vs PhD and 12 years of experience for a similar position
Why would you hire those 2 people for the same position? If the PhD with 12 years of experience is worth 50% more, then why not give them a better title?
Then you post 2 different job listings. It’s not hard. You’d write 2 very different descriptions for someone those 2 hypothetical candidates anyway.
You also don’t need put $50k-$5,000,000 just in case John Carmack applies. If he does happen to apply to your junior engineer position, you instead interview him for another position with a higher salary band.
In the real world, companies can't go down to the local "Employee Store" and order up a 12 year engineer with a PhD whenever they want, even if that's what they would prefer.
In many cases hiring is an organic process where a company weighs options based on what candidates are available to them at the time, their budget, timeframe, and goals.
A 2 year junior dev may be able to accomplish the same goal as the 12 year one, but much slower due to lack of experience, and you don't know if you'll find either until you start interviewing.
This is why many job postings fairly say "Comp: DOE" or provide a salary range.
More transparent comp is great for avoiding lowballing and discrimination (which both suck), but sometimes one employee actually is a more valuable contributor than another even if they have the same title. This is why I personally find the idea of a "salary range" completely fair, but also welcome to be ignored during the offer phase.
If John Carmack and a junior dev both apply to the role of "Software Engineer", I see zero reason why a company shouldn't be allowed to offer him a substantially higher comp due to his experience. He'll likely accomplish the same goals more quickly, more efficiently, with better code practices in mind.
Having to put it under the guise of "a different position" is just befuddling to the process. It's the kind of unnecessary legislation that pushes companies to find shady ways of solving problems.
>In the real world, companies can't go down to the local "Employee Store" and order up a 12 year engineer with a PhD whenever they want, even if that's what they would prefer.
I have hired many employees throughout my career, and never once have we posted a position for which we would have taken a junior engineer or someone with 12 years experience and a PhD. Even at small startups. Not that we weren't hiring both types of people at the same time. But we weren't hiring them for the same position. At my current company we have open positions on our hiring page for 4 different levels of software engineer.
In the case where someone applies for a position that doesn't fit, we let them know and move them over to a different position in our applicant tracking system.
>A 2 year junior dev may be able to accomplish the same goal as the 12 year one, but much slower due to lack of experience, and you don't know if you'll find either until you start interviewing.
I have never worked somewhere where they would give both these people the same title. If the more experienced dev can do the job so much better that you're willing to pay them 50% more, they aren't doing the same job. Why would you give them the same title. I don't know anyone with 12 years experience (that would be worth 50% more) who would be willing to work somewhere with a junior title.
>If John Carmack and a junior dev both apply to the role of "Software Engineer", I see zero reason why a company shouldn't be allowed to offer him a substantially higher comp due to his experience.
Who is saying the company can't post 1 job title and a gigantic salary range. Of course they can. I'm just saying that it's stupid.
If you hire John Carmack and John Bootcamp grad, they aren't doing the same job, so what's the point of pretending like they are by giving them the same title. At that point you might as well just have one title for every position in the company. Just call everyone "Employee" and have a salary range of $1-$5,000,000.
>He'll likely accomplish the same goals more quickly, more efficiently, with better code practices in mind.
If he's producing so much more/better work that he's worth huge multiples more, then he's not doing the same job. There's no reason to pretend that he is.
>Having to put it under the guise of "a different position" is just befuddling to the process. It's the kind of unnecessary legislation that pushes companies to find shady ways of solving problems.
None of these laws say a company can't post 1 job with a huge salary range. It's just stupid to do so because it sets the wrong expectations for everyone involved.
> But like you could have self taught 2 years of experience vs PhD and 12 years of experience for a similar position - there is no way everyone is at the same spot comp wise.
If these are really similar positions, then you don't need the PhD candidate with 12 years of experience--you're wasting money paying someone that overqualified.
The fact is, these probably aren't similar positions, and that's why they aren't at the same spot comp wise.
TL;DR; you may be limiting the pool of applications by posting wide ranges.
The funny thing about this is that if I see a range of $100-$150k, I would assume the actual budget is in the $130k range.
Further, with a range that wide, I would infer that the hiring team has no idea what the role is worth. That would lead me to expect the role to be ill-defined and poorly supported and that there would be significant work just to carve out an actual job there.
Given these and the huge number of open jobs, I don't see why anyone with capabilities at the high end of your range would waste time considering a posting like that. This reads like a posting for a $100k role where an applicant skilled at interviewing could earn $150k for the $100k role.
Note that letting companies know your expected compensation is only beneficial when you know that it's extraordinarily high and you wish to no waste time in many interview processes. Less senior engineers should refrain from leaking salary expectations - there's no reason to lowball yourself.
Good point, if your number is lower than what they would have offered, don't tip your hand because most likely (there are some exceptions) they will offer what you're asking.
If you do that and it's less than what the company would otherwise offer, they'll offer that instead. By putting it your CV you've effectively given away all negotiating leverage whereas the company having to list a range still means there is room for negotiation, but they can't be sneaky and pay some people significantly less than others for the same work (except however far they can get away with that within the range).
You are correct, and I should have noted that it was a poor attempt at sarcasm.
Given that the job market is already asymmetric and skewed in favour of companies, job seekers shouldn't be the ones giving away any signals, although, in reality, it is how it already works.
Not necessarily. Hiring is expensive and low balling candidates means they are more likely to consider other options. Recruiters often lead with pay, most candidates are going to be bombarded with linked in messages showing their "market value".
If those recruiters hook one of your low-balled employees, your recruitment costs have doubled, your projects have lost a productive team member, and the next person might ask for even more money.
My I low-balled myself on my first real job. The hiring manager flat out told me that the roll started at $15k+, and offered me $20k more than I asked for, which happened to be exactly the same salary offered to other members of my cohort.
The way I have seen this addressed, in a way that seems fair and forthright to me as an applicant, is to create titles with job descriptions and requirements and minimum salaries for those titles, and advertise that you are looking to fill a position with one of the titles. Tell the applicant which title(s) they are interviewing for, and you both have a much better idea of what to expect.
Think of it as a symbol of what range of experience the company is willing to accept.
Example: A .NET shop uses Oracle. The salary range is $100K–$150K.
- Candidate 1 knows .NET but is new to Oracle. They know RDBMS concepts so they can be brought up to speed, but they start closer to the $100K end of the range because they're less valuable to the company initially.
- Candidate 2 has a long track record of .NET and Oracle work, has spoken at conferences, writes about it on their blog. Candidate 2 is closer to the $150K end.
The company may want a Candidate 2 more than a Candidate 1, but Candidate 2s are in short supply. The range acknowledges that the real candidate may not match the ideal.
> - Candidate 1 knows .NET but is new to Oracle. They know RDBMS concepts so they can be brought up to speed, but they start closer to the $100K end of the range because they're less valuable to the company initially.
How long would the ramp-up be? Are we talking an increase from $100K to $150K over a year, two, three? I've yet to encounter an employer ramping me up at even a remotely decent market rate, whereas I can give myself tens or sometimes hundreds of % increases every 2 - 3 years by shopping around.
> These should be two different JDs with different stated salaries.
But I'm only hiring one person. Ideally, the one with all the perfectly matching experience. But I'm not going to wait around forever for the unicorn to show up, so I may likely settle for someone promising who doesn't quite have the experience.
> Or explicitly say "+$50K for candidates with a long track record of .NET and Oracle work".
Not the same, because giving a range allows you to discriminate on race, gender, and other things. The reality is this actually happens, and that's why this discussion is happening in the first place.
If it's an objective function of qualifications that's a lot more clear-cut.
> "+$50K for candidates with a long track record of .NET and Oracle work"
This also allows discrimination based on "race, gender, and other things" since "long track record" is completely open to interpretation and if the interviewers are already operating in bad faith, they can find any BS reason to try and undermine an interviewee.
"$100-$150k DOE" is exactly the same, if not clearer, than "$100k (+$50k if XYZ)"
For those operating in good faith, it gives an honest comp range depending on experience.
For those who aren't, a format change on job postings isn't going to do anything.
I always give a range, I've never gotten an offer at the bottom of the range. Generally, it's the top of the range, or very close to it, or top of their budget (which is below the range).
Granted, I tend to interview for roles I'm already demonstrably good at. So less experienced/suitable people might have different experiences. But this kind of negotiation clearly doesn't follow the "obvious" path.
Remember, hiring managers are spending their own money and people do get excited for candidates. When you spent 20 hours interviewing people, and you finally get that unicorn, everyone is going to push for them.
As a candidate, if I'm giving a range for salary, it means it depends on other factors, like insurance, 401k, paid time off, family leave, etc. I may be willing to take the lower end of the range if the other benefits are attractive.
I mean, if the pay is high enough I can deal with the benefits on my own?
I'd rather take a 500K job with no benefits than a 300K with full benefits, since the benefits can easily be procured for 200K as long as they're okay with unpaid time off [that prorates the 500K].
"If you're a white male you'll get 1.25X and if you're a black female you'll get X?"
More specifically, why can't someone who meets the JD get the stated number? If they interview and don't demonstrate the ability to meet the JD then don't give them an offer, it's that simple.
Do you think that all salespeople are equally productive? Do you think that all waitstaff or customer service people are equally productive? Do you think all software engineers (at a given level) are equally productive?
I think there's large spreads of productivity in many of those types of workers and if you pick a single number for a range of possible productivity, you either overpay some people or you cut yourself off from the most productive workers. (Some people argue that there's a 10x spread in SWEs, others that there's a -10x spread, but I don't think anyone thinks there's realistically less than a 2x spread at a given level among competent SWEs.)
Do you think that having a single set wage helps you have the flexibility to land both those employees whom other companies find to be the most valuable as well as land the broad middle performers that are so needed to build a scale up company?
I can’t see any way that “everyone, no matter their interview performance and relevant experience in what we need done, either gets an offer of exactly $X/yr or gets rejected” is an optimal strategy.
Don't give them the chance to stretch it out. Ask up front or tell them what you want, again up front, ask for what the "standard package" is for the position (trust me they have one). Judge them by their response and how sincere they seem. Some HR won't necessarily know up front but they can find out.
this is one of those ostensibly good ideas that has some downsides which are often not discussed - the main one of which, is salary depression.
Forcing employers to publish salaries on job ads will inevitably lead to wide salary bands (lets see how absurd they get) with a low ceiling on the upper tier. Employers know that if they publish a high number, job candidates are naturally going to want to shoot for it, and would be disappointed if they got significantly less than the maximum advertised, compromising offer acceptance rates. Hence employers will set a lower 'maximum' salary than they might actually pay if the salary was hidden.
See UK public sector for evidence of this; salaries must be published, maximum is always significantly lower than equivalent job in private sector.
I've posted my fears in a past thread: I'm concerned it will push down salaries to lowest common denominator.
Very few of us wake up and think "I'm not a top performer; I should be paid less than some of my colleagues".
So once a bell curve of salary is published, everybody will demand to be paid the same, and it'll very unlikely be the top performer's salary.
Or maybe we'll have massive reshuffle until all teams are equally performing - so we have a team of slackers in company A, team of solid performers at company B, and team of fantastic rock stars at company C.
Maybe I'm cynical and pessimistic in my old age; maybe we can employ coaching techniques and use the transparency to say "Fatima is getting $15k more than you because of this, that and the other thing. If you do those you'll be awarded the same". Maybe the person will accept that and be motivated. Maybe we'll even be accurate and honest about the reasons. Maybe those reasons won't include "because that person is 20 years younger with no family, responsibilities and life and works 90hr weeks on average" etc. Maybe it won't all backfire horribly.
I think this is too cynical, yes. To me, this is just the free market. If folks can see Bob gets paid way more and see he doesn't do anything, they can leave. Right now they just keep trucking with blinders on.
The thing is, even if someone demands to get paid more, it won't necessarily happen. It's still going to be a negotiation. This is basically a shift to give workers power again, since most unions are gone. It's a lot easier for me to point to a stellar performance review AND salary band then negotiate blind.
I'm not worried about the situation where Bob the slacker is getting top dollar. I agree that market can and should solve that (if it doesn't already).
My cynicism is other way around:
What happens when Bob the slacker, and also all the people along all parts of bell curve, demands to get same as Fatima the rock star? Or worse, make aspersion and assumptions that she is in fact Bob the slacker?
In other words, my cynicism is specifically focused on my perception of our general societal lack of, and interest in, self-awareness :-/
Fatima likely gets promoted, and you get transparency into paths to become someone like Fatima. In the case of Emily who toils away tirelessly holding up the backbone of the company, but isn't as visible as Fatima, now Emily has a clear path to advocate for higher compensation and if the company decides she isn't worth it, she can leave and that company will immediately feel the pain.
I don't really follow the logic that this pushes salaries to the bottom of the bands. Companies want to push them to the bottom, employees want to be at the top, if in a single instance a company and employee can't agree there's a more transparent market for the employee to explore. If they apply for jobs in a certain band and have zero success, they will need to adjust their expectations to find a job at all and should search out lower-bands or improve as an asset or be out of the job entirely.
Bob the slacker can demand it. But unless Bob is unable to find another job that pays him what he demands, he has no leverage over his current employer.
If folks can see Bob doesn’t do anything, why wouldn’t they walk already? Whatever money Bob is siphoning away from the company is hurting them whether it’s more, less, or exactly the same as what they make.
I mean, walk away to where? Everything needs context or it's hard to answer why. It could be a matter of needing insurance, obligations to taking care of family members, to cost of living, to lack of knowledge of where is better.
By showing salaries, folks could have the knowledge to see other positions that match their current job but pay better (or at the least have the possibility of paying better given the range).
I mean, most companies already have salary ranges (they're just invisible to employees). So the process of promoting to a new "band" or "position" would stay the same. That and companies can adjust their ranges, they're not set in stone. Or go the exec route and just pad with equity and other benefits. Lot's of options.
On the other hand, I actually always see folks claim the downsides are greater than the upsides, so it's strange you feel the opposite.
Honestly, I'd rather we try it and see what happens.
In the case of the UK public sector anecdote you've shared, I'm guessing it hasn't actually depressed salaries at all. It's likely lifted the bottom, and perhaps squeezed some high positioned "high ceiling" folks down. But I'd need to see evidence of an actual drop compared to the "hidden" times. Otherwise it's just speculation.
Also, while you say the maximum is always significantly lower than the equivalent job in the private sector, I would then ask "Is the median higher than the equivalent job in the private sector?" because if so, that's a win. It's not much good to folks if a single individual can make boatloads of cash.
Thanks for your reply. I must say, I did not say 'not try it' - in fact, I'm pretty much pro salary transparency.
The point I am making is that there 'are downsides to ostensibly good ideas', which are worth pointing out and discussing. This bill will likely pass regardless of any chat we have here, so this is all in the spirit of exploring the topic.
That candidate salary expectations will be elevated by transparent pricing is valid speculation given that it comports with what we know about pricing psychology - we see two numbers and typically go for something in between and to the right. It does not take a huge leap of empathy to understand that a candidate who knew the top salary and ended up being offered half that would be more disappointed than if that candidate never knew what the numbers were until the offer was made.
Another reason why salary suppression will occur is simply a lack of agility compared to employers who don't have to declare. Once you publicly state a salary band, you probably wouldn't be able to go above the maximum or below the minimum. This constraint won't apply to employers who don't need to declare and hence they will inflate overall market rate, leaving the public salary employers behind.
I think this is basically what is going to happen. Good things will too - but I trust these have already been made in the bill about to be passed
Public sector salaries are about the bennies / low pressure work environment, like startups are about the equity. No one is working there for the wages.
You might be right, but the UK public sector isn't evidence, private sector almost always pays more, everywhere and no matter what industry.
One could make a case the other way - that companies won't lower public salaries, because they need to hire people, often desperately. In my experience, the lower the salary, the less response you get to your role, and certainly from people who are in-demand.
However, there was also profit sharing which was based on your W2 earnings (side bit, the profit sharing went into your W2 earnings for next year and became a sort of compound interest growth). Additionally, there were "goals" and "bonuses" which could, again, give a substantial boost to the total pay but wasn't part of the stated compensation.
So, yes, there are certainly ways to work around the posted salaries.
yeah there will definitely be all sorts of ways to do it, a lot of which will need to be 'off the record', which obviously then becomes corruption. I remember supplying candidates (was once a recruitment agent for the public sector in the UK) and off the top of my head, two such work arounds were a) a promise of guaranteed promotion at first bat and b) fail the interview, hire back as even more expensive contractor.
Well meaning legislation always produces outcomes like this
Corruption is endemic everywhere. This kind of law just plays whack-a-mole, shifting the corruption elsewhere, but not actually eliminating it. Since the fish rots from the head, we are unlikely to ever see changes that eliminate corruption at its true source, imprisoning the people in power that profit from it.
could be we need to rethink 'corruption', seeing as it is endemic in any system we make. It could be considered a form of hacking, which most ppl here wouldn't bat an eyelid at. Perhaps we need to 'build in' expected corrupt behaviours in systems design, seeing as we cannot eliminate we might as well manage it, maybe even make it work in the systems favour
This same law exists in Colorado, and I'm frequently seeing job postings that just list $60k to $190k. Anyone who sees that obviously knows they're not listing that range in good faith and takes nothing from it other than that it will be at least $60k. The ones I've seen I'd probably estimate to actually around $80 to 90k
I don't know about the UK situation specifically, but in other areas I'm more familiar with public sector salaries lag private sector for lots of reasons (job stability, pensions, old tech, etc.) which have little or nothing to do with the posting of ranges.
Wide salary bands will only lead to people applying that qualify for around the low end. If you advertise for 100k-150k, the 150k candidate will skip you for a 130k-180k posting. I'm not going to waste time applying for a job that has a range where 20%-50% of the range is below my minimum expectations.
Public sector isn't a great thing to base conclusions on, while the published ranges are lower, so are the expectations. As someone with public sector experience, they absolutely get what they pay for.
These kinds of laws tend to come with severe unintended consequences. Or, perhaps, they might be intended, just not ostensibly. Either way, from the public's perspective, there are unintended consequences. We must always be mindful of those. Unintended consequences aren't always easy to predict, so we have to see how it's gone elsewhere. Consider https://www.coloradoexcluded.com/ .
yes, this is exactly what will happen. Very top tier candidates will migrate to employers that do not declare salary. Plenty of talent left to do the job in most case for those that publicly declare
That’s an absurdly narrow range, IMO, even for a company advertising entirely in good faith. Most companies internal ranges are at least twice as wide as that for a given track/level.
It would be nice if you edit your original comment to note that you are not talking about what is in the bill, merely what ought to be. It's misleading as is.
Agree with you overall, except for the public/private sector differences. The difference is due mostly to the job security in the public sector, which has a price.
I'm curious if anyone else is concerned about the downside to this. Once they post a range they have to follow it because of the legal implications. Many companies are willing to bend the budget for an exceptional candidate at the very top end. I worry that some of the senior roles that could have negotiated above the top end of the range will now be hamstrung by it. I know of several situations where a company thought the top of their range was somewhere around $260K and went up to $275K after seeing a candidate they really liked. They aren't likely to post the role with the extra $15K in it since if they post a role from $200K-$275K then most people are going to want $250K+ which is near what they thought the top of their range was.
I went freelancer a while back and now just don't worry about it. Let those who enjoy being part of a system with ranks, levels, titles, and politics deal with it. It was rough going at first but I've found steady clients now which I've been able to work with for over a decade and they aren't going anywhere.
I didn't know it either, but this bill mostly just moves forward when that information must be disclosed. Current law requires it to be disclosed upon request after a job offer has been made.
I am willing to accept some short term costs for long term gain.
As long as the west coast and northeast coast and IL and CO pass the law, then it will effectively be nationwide since most of the higher paid employees are in those states anyway. Just need CA to WA/CO/IL/NJ to MA to fall in line with each other, and employers will not really have a choice.
I don't consider pay equality a long term gain. I like negotiating for my compensation. I like that there's room to do so because different people have different needs and bring different value to the table, different employers have different resources available, etc.
Price equality is not the goal. Price transparency is. Microeconomics 101 is that market participants need pricing information in order to best allocate resources as supply and demand curves shift.
The more easy and quick it is to ascertain prices, the more quickly and efficiently resources, such as labor, get allocated.
Price transparency does not mean sellers have to pay the same price to everyone.
I’m very curious what the net effect on culture and salaries would be if everyone knew everyone’s total compensation.
On one hand, it’s already possible to know how much most people bought their house for and what their rent is, on the other hand, the data is relatively obsfucated and not directly relevant since most people bought their house in the past and aren’t new homeowners)
Would all businesses simply price discriminate if there were a very easy way to determine someone’s salary?
I feel most of modern personal finance is basically just taking advantage of information asymmetry.
> "Since 2014 it has been possible to find out who has been doing searches on your information," explains Hans Christian Holte, the head of Norway's tax authority.
> "We saw a significant drop to about a 10th of the volume that was before. I think it has taken out the Peeping Tom mentality."
This is just genius. And yet I'm imagining some simple ways around this that would inevitably pop up were this a thing in my country.
I wish the not anonymous to search feature were applied to home addresses and home purchases too. I see the benefit of the data being publicly available but wouldn’t want it abused by the wrong parties.
Because I am a public employee, anyone can go online and look up my salary. I've often wondered who might be doing that. Of course, where you live and if you own your own home are both publicly available and already pretty good proxy measures for income. I know for a fact that I pay more for certain things like help with gardening, an electrician, plumber, etc. based on where I live.
> Functionally in tech that already exists with levels.fyi (At least for larger companies.)
Note, the data there is getting better but it is not perfect. As they accept both offer letters and W-2's, which can be wildly different as share prices move.
They don't have a choice. Washington's legislature only meets for 2-3 months per year[1], and they're paid about $56,000 per year[2], which sounds pretty good for 2-3 months of work...except that they're actually working behind the scenes all year long to get legislation lined up, and then falling over each other to get things done in a short time window every January. It's not an efficient or particularly effective system.
Most state legislatures are only part time, so when not in session they have full time jobs. That's actually how the US founders wanted it to ensure that politicians stayed "of the people" and couldn't escape the effects of their governing. "They will never vote a rod against themselves" (can't remember who said this so take with a grain of salt but it's stuck in my memory). At some point though the Federal legislators decided to give themselves full time jobs. At this point now most probably make enough money insider-trading stocks (yes the same thing that gets a normal citizen jailed), so they probably wouldn't have to work when out of session anyway.
I personally think the ideal is combining WA's and CO's requirements about salary bands in job-listings and CA's law about excluding previous compensation in hiring decisions.
Previous compensation matters to the employee, it's only a wage-suppression technique from the employer's side.
No one will take them seriously. They are unwittingly now participating in a reputation market.
Granted, status and prestige are intangible assets. The hiring manager will find themselves in the position of spending brand status for financial flexibility. I can see a handful of companies getting rolled on social media for this as the game gets started and then less of it as things settle down. Long term, I'm more interested in seeing how companies optimally size spreads in order to signal to the labor market "you should" or "you shouldn't" work for us. Job search toolmakers are in a fun position bc they can set the stakes on metrics like 10% spread and influence the labor markets in powerful ways.
If I see a company that specifically excludes Colorado residents, I already know the company is going to be doing all kinds of unethical shenanigans to employees and is likely a bunch of fools not worth bothering with.
I've seen this comment many times before, in Colorado and more recently in New York City.
Laws can be passed to make this painful for companies.
Department of Labor, either at the state or federal level, can enforce companies trying to play a game with their numbers.
Also the collective pressure of the market would have a mitigating effect. Game theory comes to mind, would you apply to a job listing like that? Would you apply if every other job listing has a more "honest" range posted, or would you spend your time applying to companies that are cooperating with the state government?
Same here. In business you learn to stay away from price sensitive people (cheap asses) real quick. It signals many bad things. They are going to be difficult to please. Perhaps litigious. They probably feel entitled and are willing to exploit. Totally unprofessional. Perhaps the business is on the rocks. In any case, they are oblivious to the signal they are sending...which is a clear indicator that the above mentioned possibilities are more likely.
Even the tighter bound of $75k-$250k is not a job posting where you will get a good quality applicant pool. It reads as "this job is worth $75k, but if you really impress the interviewer, you could earn $250k." You will get a lot of people currently earning $60k in your applicant pool, which might be fine if you think the job is really worth $80k.
But if you think it's worth (say) $200k, you will not get a good view into the labor pool at that level because your posting looks like you don't value the job at $200k, so $200k-worthy applicants will not apply.
Either way, you will get too many applicants who are not a fit and take longer to fill the opening. Plus, your firm will build a reputation for dishonesty.
Regulatory-wise: Colorado's equivalent law has language about "good-faith" and "reasonable" ranges and you can report companies that do this sort of thing to Colorado's state government to face fines and such.
I suspect this is mostly useless for tech folks as you said; but it might be interesting for lower wage jobs that bait people with "Mcdonalds hiring for $20 / hour" and a tiny asterisk hidden there etc.
The bill will be passed, then the state department of labor will issue rules regarding its enforcement. That's how government works.
When Colorado did the same thing, the Colorado department of labor issued rules that required employers to use a "good-faith and reasonable* estimate" of the salary range. You can expect the same of Washington.
*"good faith" and "reasonable" are legal terms with specific tests and judicial precedent around them
> Other companies have disclosed pay information in ways that make it difficult to draw comparisons. For instance, some firms are setting pay ranges that are specific to Colorado, hinting that the pay might not be the same elsewhere. Others are posting salaries with ranges of as much as $100,000 or more between the low and high ends. A pharmacist job posting at Walmart said applicants can make anywhere from $52,416 to $153,920 annually for the same job.
> Additionally, for internal transfers to a new position or promotion, the employer must provide the wage scale or salary range.
Nice. To the best of my knowledge, this is the first bill to mandate this; all other bills simply mandated that external job postings include a salary range.
I hope this bill includes language that forces the advertised salary range to reflect the actual range. Otherwise, companies will just say that the range is $50-$500k.
I would still like to see a bill go one step further and mandate that everyone’s salary be public knowledge to everyone else within the same company. If this generates resentment, it means the company is poorly managed. The company would therefore either be compelled to fix their pay discrepancies (thereby allaying the resentment) or risk losing resentful employees to other companies.
> If this generates resentment, it means the company is poorly managed.
You can't honestly hand wave away human nature like this though.
"You are paid 20% less than Bob because you are 20% less valuable to us."
Even if that was 100% true, and it was obvious to everyone, there would still be envy and resentment to contend with.
Still I'd rather have it that way, than how it is today where I have to have private text messages with my coworkers to figure out who is getting screwed by management...
> Even if that was 100% true, and it was obvious to everyone, there would still be envy and resentment to contend with.
we had open levels at the previous company i worked for (70-ish engineers). if you asked certain seniors at the company, you could trivially get the mapping from level -> annual compensation salary/ISO grant.
positive experience IMO. it forces managers to “get it right” when it comes to performance reviews more often than what i’m used to at other companies. being a not-too-large company, the easiest way to get a higher level is to take on more responsibilities (not to just output more code within your team). that might differ from your own goals or expectations, so it’s great that you can look around and see for yourself what behaviors actually correspond to level/salary raises!
I think many people would rather be paid fairly but invisibly less than a higher-performing colleague than to be paid that exact same amount and know that a higher-performing employee was making 25% more than them. Even if “fair”, it’s likely to generate resentment.
That’s fair, although I think way more people would rather know that a lower-performing colleague is making 25% more than them and use this as leverage to ask the boss for a raise.
While some people might resent others’ well-deserved successes, far more people resent others’ undeserved successes.
> What's the problem that needs the government stepping in?
I think it's quite obvious.
There is an imbalance in the job market, and those offering jobs do not have any incentives to resolve it. In fact, they usually take action against any corrective measures, e.g. by suggesting employees that discussing their wages is unsavoury or even illegal (it is not).
"Just switch jobs" is not a solution, because sometimes there isn't even a choice.
It seems highly improbable that the day one was born, out of 200,000,000 jobs in the US, one happens to find the one and only job they could ever have.
That's not what I said. Yours is too a quite narrow-minded position.
Also, screw companies doing this. The job market is completely asymmetric, and it shouldn't be. It's tiring and disappointing to have to blindly negotiate with recruiters, and akin to the car buying experience.
> All that means is the candidate won't get the offer if he's not worth the bottom end of the range.
How is this different from the status quo? If you don’t get hired for a specific position, it means the company didn’t think you were worth the salary for that position, whatever that might be.
> Some people are simply more productive in the same job as other people. Why shouldn't they get paid more?
They absolutely should, and I didn’t mean to imply otherwise. I meant “pay discrepancies that would foster resentment,” i.e. undeserved discrepancies.
> The company will not be able to adjust the salary to one more appropriate for the employee, so both parties lose.
Got it, you are concerned that this wouldn’t allow the company to hire someone as the lowest paid member for a given role. This is easily solved by either (a) forcing the company to publish two ranges: the range they’re willing to pay, and the actual range of current employees, or (b) making the published range nonbinding. If the company decides to lowball the job candidate, it is up to the candidate to take or leave the offer, knowing that it is indeed a lowball, which without a salary transparency law a candidate currently has limited-to-no way of knowing.
BTW, I prefer the latter approach: the law ought to be focused on mitigating salary information asymmetry between the company and candidate, not heavy-handedly enforcing a specific salary range.
> People in the same company will always have different views on what is deserved and what isn't.
Of course, but this has no bearing on whether salary information ought to be transparent or not.
A similar bill passed in Colorado and resulted in many employers stopping hiring in Colorado to avoid having to comply. I hope this won’t have the same outcome.
I think I've only seen a single job ad that explicitly stated no colorado in the past few months of my job search. Most just have a link you can click that buries "$60k to 190k" somewhere in fine print.
It doesn't work like that. The law requires that the ranges to be sane. I don't remember the exact details but I believe it has to include existing employees with the same job and can only be some band above or below that.
Colorado's law has language about "good-faith" and "reasonable" ranges. I forget what the penalties are but it's fairly easy to report companies/listings to the state that do this.
Amazon and Microsoft are both headquartered in Washington. This law could transform the industry, or Microsoft and Amazon might move out of Washington.
> Microsoft and Amazon might move out of Washington.
I highly doubt Microsoft would up and leave over this one piece of legislation. See multi-year spending on new campus which isn't open yet:
https://news.microsoft.com/modern-campus/
Amazing. I wonder what the implications are as I'm aware of jobs many jobs intentionally avoid posting in Colorado due to the same issue; but the sheer size of tech talent in the greater Seattle area is unavoidable.
Does salary in this bill include RSU or stock options? If not, then it may not be that relevant to tech employees? For instance, anyone L6+ in Amazon received 160K in Seattle area and 180K in the bay area.
I don't believe this will be meaningful at all. Supposedly the same thing is going into effect in NY, and I've seen plenty of postings with ranges then all sorts of caveats about "experience," or flexibility in the role, or whatever else, that make it clear that the real range and the published range may be quite different. This, of course, to speak nothing of the distinction between salary and total compensation, which can be quite different.
I've worked at several places that say 'we pay at the market rate', and it's very hard to verify. It leads to gossip, or interviewing and getting offers etc..
This should make it easy. If you work in an area with multiple competitors this is going to be great for employees.
I assume it's not illegal to negotiate a salary that is higher than the range stated in the job posting.
Hopefully companies don't start using the job posting as an excuse not to negotiate higher salaries, otherwise it could depress wages for highly qualified applicants.
If the applicant is highly qualified, wouldn't they be able to get offers from other companies that are higher?
I see this as a personal issue: you gotta apply to jobs you don't think you're qualified for and be okay with being told "no" sometimes. If you don't test the upper-bound, you'll never find it.
"Pay everyone correctly" is a loaded statement. So is "valid wage." These things are determined by the market and what a candidate brings to the table -- not just by the job itself.
Realistically, companies try to pay their future employees as low as possible. Someone comes along that chooses to be a so-called "better negotiator" and they get paid more. Why should people have to play the negotiation game?
"What a candidate brings to the table" is likely defined in a leveling guideline. If they bring more to the table, maybe they should be in a different bracket.
If someone is so special (and 99.9% of the people aren't), then maybe give them their own special role with special titles; but we're not talking about exceptional people here, we're talking about an average developer at this company, which I hope has an average relative skill level. Sure, one person may be better at X or Y and worse at Z than another but that's why we have several people: distributing load and specialization.
Honestly I don't see what this will accomplish. Employer posts salary. Candidate interviews. Actual salary will be higher or lower than the salary dependent on perceived experience. Equity grants boost TC to the stratosphere.
The Washington senate will pass just aboutanything. I’m 99% sure they’re all just desperate political runner ups who don’t want to lose their free government cheese.
People who come up with these schemes need to consider the "spam response" and engineer in some kind of countervailing pressure, otherwise you just add noise.
The trouble is, if you post salary range from X to Y, most candidates will expect getting Y and will be permanently unhappy with their new position if they get closer to X. It is simple psychology.
Then what about the candidates that are so good that you want to pay them more?
I fully expect that best candidates will still be able to negotiate better than the official salary range.
Now we need laws restricting a specific job-posting tactic where a few employers spam their same jobs over and over, multiple times daily, so you have to scroll past or filter out redundant listings. DoorDash is a prime example. Truck-driving jobs belong in a separate category altogether, but they are also prime offenders.
These bills are mostly useless if they don't include bonus and stock compensation, and this bill only requires a "general description" of other benefits.
Companies that don't want market transparency will simply restructure compensation packages -- "bonuses" doled on on a 24 pay period amortized schedule are an option even when equity isn't.
In tech, salary being mostly useless as a measure of total comp is already the status quo... if someone tells you that their salary is $160,000 then could be making $160,000 or they could be making >$1M. Expect to see similar behavior but even at the $60K/yr jobs.
why not require companies to post salary ranges of already employed workers in same or similar roles? seems like it could circumvent the absurd range issue
Eh, but it will at the margin though. Like, you are undoubtedly correct, but part of the effect of this is piss off people in the rest of your org when they see the tech person you hired makes more than people think they should. This essentially causes the value of the high-performing tech person to decrease for you, since along with their wonderful skills you are now also hiring a tiny amount of resentment in your firm. At equilibrium, if you believe this effect, it would cause the worth of tech talent to be lower for your firm, and the equilibrium salary would reflect that.
Its good for employees to know the salaries in their org. Why is this only a consideration for private orgs too? I worked at a public org where you could look up each and every salaried person's compensation. It doesn't breed resentment to see your boss is compensated exactly $437k this year, it sets a target for yourself and your career. The sky isn't falling at that org because salaries are public.
So you're saying a few people making way more than the rest of their peers will be pulled back in line with the rest of their peers while their peers make more money?
Honestly, I'm okay with that.
If someone was making 500k and their coworkers were making 100k, maybe their coworkers _should_ be being paid 150k or 175k and that 500k worker should be either promoted or pulled back to like 250k
If the job is available to people in the state then the law applies. So if I'm based in Texas but advertise a job publicly to remote workers, then I have to comply with (in my case Colorado) law about wage transparency.
I've also read that just including the line, "not available in Colorado" is not a valid legal recourse to skirting the law.
Law makers are generally pretty good at estimating people's willingness to try to get around laws like this and include all kinds of gotchas.
For a very select few in the managerial class, yes. I think a lot of legislation like that is written with jobs that don't have that kind of comp in mind. However, I do think that an outcome of legislation like this is to simply create more compensation of this sort that doesn't have to be figured into "salary." There will be a greater incentive to use those instruments to the extent that you still want to keep total compensation less transparent.
We just shot ourselves in the foot pretty badly with this bill. Software engineers are not meat packers. There is huge variance in productivity between two people at the same level in the same role. Here is what will happen now:
- candidates who get an offer at the bottom of the range will take it personally and keep hunting for a job elsewhere
- candidates who get an offer at the top of the range will (rightfully) assume that the next significant pay rise is far away (basically, only upon promotion)
- the hiring managers will have to shoot a salary range first without having seen a candidate, so the range will have to be astronomical, else they will miss on top performers on the market
1. The difference here is that previously (currently), you still decline the job if you know the market, or you accept a low offer because you don’t know the market well. So the difference with the new approach is better: at least you know to decline or negotiate.
2. This isn’t really different from the status quo. Companies can have internal bands of where they expect comp to be for different positions, and then they stay within it when giving raises. Either they do that, which is the same as before, or they give great raises, which they also would have already been doing. Not sure how the law changes how raises work in the cases where you negotiate a higher salary up front. In either case, it’s always better to get paid more up front and then find a new gig if you aren’t getting raises as expected.
3. The status quo is already this, but no one knows. Clearly a great applicant will have a lot of room to negotiate upwards. If you know up front the job won’t meet your requirements, you’ll pass. And if you weren’t expecting a lot but see the big range, you’ll think, “ok, how do I get that?”
So I don’t really understand why any of that is bad. Doesn’t seem like any of the things you suggested suppress wages.
What I am trying to say is that this will induce salary depression, because companies will never post the (very) high salaries that they pay for their (few) top performers.
Companies will post their 0% - 80% quantiles (in fact, the lower number will be slightly lower than the lowest salary they give for that level, if only to give comfort to people starting at the bottom of the range), so they will post something like -10% - 80%.
A candidate with less expertise/experience in the role should expect to be on the bottom end of the pay range and a candidate who has seniority/expertise in an area should expect to be on the upper end of the pay range. I know for a fact that I've been on the low end of the pay range when my area of expertise didn't quite overlap and expected as much, but I got to learn a new technology and expand my field of knowledge.
I don't understand how you can have a labor market where only one side has information on what the salaries are for an industry through a team that does market research. It depresses wages, mostly for internal employees who aren't paying attention bc they're content with their jobs.
Price transparency leads to more efficient markets, no reason the labor market is any different. A company hiring an employee under market rate, because the employee doesn't know what market rate is, is a failure.
EDIT: Wanted to add that this hits closer to home for me b/c I've personally experienced this.
Went out and jumped companies and got a 300% raise b/c I was underpaid at the prev, only know that thanks to levels.fyi. New hires at my level were making almost double what I was.
When other engineers at my current company talk about salary, or total comp more generally, they vastly underestimate the state of the market.