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03/16/2017

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I have to disagree with one of the positions expressed in the World at Work full statement, as follows: Compensation should be tied to the specific job and market forces that dictate the rate of pay for that job. In order to make a compelling offer of employment to candidates, WorldatWork opposes policies that prohibit employers from requesting a job candidate's total rewards history during their consideration and interview process.

While I 100% agree with the first sentence, the opposition expressed to policies prohibiting salary history contradicts this intent. As a practitioner I have many times provided market data for a role (i.e. 90K-100K), but a hiring manager knows based on salary feedback history from the candidate they would accept less (let's say 85K) - so do they offer the market rate anyway (90K)? Nope, they go with 85K and generate more pay inequity. Had that same manager not had the historical information from that candidate, that candidate would have likely been offered 90K instead.

Great topic, Margaret! A number of us regular posters here seem to agree with K. Gremillion, as any search for the "pay history" or "past pay" topic will show. When one side to an economic transaction has information denied to the other, the playing field is not level and the market is neither "free" nor "open." Refusing to pay the established job value regardless of prior pay is a classic form of systemic discrimination, perpetuated by blind imitation.

It is also reckless management, creating disruptive internal inequities. Modifying offers to competent candidates due to prior salary also makes the new employer's starting pay decision contingent on the wisdom of the prior firm. If they overpaid, you overpay. If they underpaid, you underpay. This is conscious bias and a structural barrier to equity. Hardly smart.

Using prior pay history as a cudgel might save a little money in the short run, but it creates serious issues that always cost a lot more to solve eventually. Fair pay delivered grudgingly via adjustment later hurts morale, when you could have won dedication by playing fair up front.

On first read, I assumed W@W's statement was regarding legislative policies prohibiting requesting/demanding pay history. It's unclear they even mean employer policy.

I hope employers continue to evolve to ban this process with help from HR, D&I, and Comp teams.

From personal experience, employers who do required salary history usually are not up front in proposed pay ranges. Early in my career I watched interesting candidates be passed up early in the process for sharing required pay history. This was for both showing too high or too low of pay compared to the role's range. They were not looped into what the role paid or why they were dropped.

Mutually sharing anticipated target ranges should be enough to work with. Salary is only one peice of a total reward value for candidates. Responsible interview practices will assess if candidate can fulfill expected value of role.

One area I would have liked to see WorldatWork comment on was the foundation of sand that gender pay equity arguments are built on.

A long time ago I wrote a blog for Compensation Café describing how the US Census uses self-reported pay and job content data from citizens. http://www.compensationcafe.com/2010/10/the-gender-pay-gap-would-you-accept-this-compensation-data.html

Using this foundation for arguing that there are wage inequities across the country seems mighty weak. What respectable compensation professional would ever use self-reported compensation and job content data in their market studies?

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