Are Companies Intentionally Posting Low Salary Ranges To Prevent New Hires From 'Asking For Too Much?'
Photo Credit: Ekaterina Goncharova

Are Companies Intentionally Posting Low Salary Ranges To Prevent New Hires From 'Asking For Too Much?'

Today’s job market is an interesting one. From significant tech layoffs to other companies experiencing hiring surges, jobseekers are caught in a crossfire of what to do and whom to trust.

A part of that trust factor is often ambiguity around salary. Some organizations have done a great job of being more transparent about salary expectations, while others have remained discreet about job and salary expectations.

In some cases, states have proposed laws to protect job seekers from wasting their time and energy on job processes that don’t meet their minimum requirements. However, some companies have thought of other ways to avoid those laws (In short, it’s giving fraud).

According to Fortune, while a few states like New York and Colorado now require organizations to list the salary ranges for posted jobs, some organizations are using the median salary as the top of their salary range. This method only favors employers as they attempt to discourage potential hires from demanding large salaries and prevent current employees from realizing they are underpaid.

“It has come up a lot. Part of the challenge here is that pay transparency is new, so there is this fear among HR people about this new information that people will not understand it. So the feeling is, ‘Let’s help cushion this so we are not pressured.’ Do I think it’s the right approach? No,” said Melanie Naranjo, Vice President of People at Ethena.

Employers are interpreting this law in many different ways. In New York, for example, they listed extensive pay ranges, like $100,000 from bottom to top. This outlook gives little insight into real salary expectations and further contributes to people’s frustrations with seeking new opportunities.

“There are companies intentionally posting salary ranges below their actual salary bands for job seekers,” said Jamie Coakley, senior vice president of people at Electric, which provides remote IT services for small and medium-sized businesses. “It’s a risky choice that is not in good faith of what the salary will be, which is the entire purpose of the law.”

A private HR discussion board revealed that HR executives were concerned about potential employees asking for too much money or that current employees would demand raises if a complete and more accurate salary range was revealed.

California and Washington also have new laws regarding salary transparency. However, there is little to no detail on how the states would enforce how organizations will interpret the laws.

“I don’t think employers are trying to be cute with this,” said Emily Dickens, head of government affairs at the Society for Human Resource Management. “This is difficult.”

Only time will reveal how this phenomenon will play out. In the meantime, it should be needless to say that job seekers deserve fair and equitable disclosures around salary.