ASK HR: Is it a good idea to make employees’ salaries public?

Q.  I work as an electrical engineer. Last year, we had training on values such as honesty and transparency at the company.

We all agreed to abide by the values but I was stunned when we were called for a staff meeting by HR, announcing that to foster transparency, the HR department would create a database with all employees’ salaries!

Some of my colleagues and I think that this is a very bad idea but we don’t know how to approach it. Please help.

The issue of salary is a confidential matter between an employer and employee. The only staff who are privy to this is HR and some specific staff in Finance who make the payments.

However, even in HR, there are different levels of access depending on the levels of the staff.

In the recent past we have seen salaries for certain professions made public and people have formed opinions about the recipient and expressed their sentiments online on social media. In some instances, the disclosure has elicited sympathy.

The disclosure can be a source of conflict between employees since even though they are in a similar position and grade, salary history of each individual may create a differential in the ultimate pay earned by employees. In the organisation it can also create a superiority and inferiority complex to the recipients depending on the amount earned.

Most often than not, employees who have changed jobs severally get a premium pay review with each new change which then give them a completive advantage when they are bargaining to join an organisation. Such an employee will most probably have a higher pay than the peers in the same job grade.

Internal promotions most times are governed by policy on the percentage to be given on promotion and annual salary reviews, therefore the growth in salary is limited.

Following the global financial crisis of 2008 onwards, corporate governance experts have taken the view that companies, particularly public listed ones, must disclose directors' remuneration.

In Kenya, the Capital Markets Act (CMA), which regulates public listed companies, came up with regulations which requires disclosure of directors' remuneration to the shareholders.

Therefore, your HR might be borrowing from these. However, this may achieve a different objective than promoting honesty and transparency.

I would suggest that you communicate your discomfort to the HR department and you can also channel this through your supervisor.

The most difficult aspect to change is behaviour, therefore embedding values in the organisation cannot be achieved by one aspect. It’s a continuous process and takes time and commitment from both employer and employees to change.