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Pay transparency is the practice of openly sharing compensation and benefits information with candidates during the hiring process and with current employees. The goal is to promote wage equity, build trust, and ensure fairness across the organization.

As many states introduce or update their legislation surrounding pay transparency, navigating this landscape with confidence is crucial for both legal compliance and employee satisfaction.

According to The Workplace Advisors, there are four key steps employers can take to streamline this process.

Avoid Prior Pay History Questions
Regardless of local or state laws, it’s best practice to refrain from asking candidates about their previous compensation. Instead, focus on the value of the role and what it is worth to the company. This helps ensure future compensation is based on the job, not past salaries.

Document Salary and Benefits Clearly
Prepare standardized compensation materials for both external job postings and internal use. Clear documentation ensures that salary ranges, benefits, and other compensation elements are consistently communicated across the organization.

Audit Current Compensation Practices
Regularly audit the compensation practices to ensure that all roles have defined salary ranges that align with both internal pay equity and market benchmarks. This helps maintain fairness and consistency across the organization.

Train the Hiring Teams
Educate the recruiters and hiring managers on how to communicate salary expectations and legal boundaries, including what is permissible to ask during interviews. This ensures compliance and maintains a smooth hiring process.

Click here for more information on the proper approach to pay transparency.