First, let’s settle a myth. Can employees legally discuss their salaries with other co-workers? Yes. Should they? That’s another story.
Recently, the National Labor Relations Board (NLRB) decided that an engineering firm had unlawfully fired one of its employees for discussing salary information with co-workers. The firm was ordered to reinstate the fired employee and pay back wages and benefits. The company was also ordered to reverse its policy that prohibited salary discussions and to inform employees of the change.
The ruling was noteworthy in that it contradicted a common misconception — that employers can forbid employees from discussing their salaries.
Whether you are an employee or an employer, this is an important finding. Repercussions from these kinds of conversations can ripple throughout the entire company. The more you know about what you can and can’t do, the better you can protect yourself and your company.
Here are some guidelines to consider.
What employers can’t do
You cannot forbid employees – either verbally or in written policy – from discussing salaries or other job conditions among themselves.
Discussing salaries is considered a “protected concerted activity” by the NLRB and it’s protected regardless of whether employees are talking to each other in person or through social media.
What employers can do
Of course, discussing salaries can be problematic. Conversations can evoke feelings of jealousy and inequity among co-workers who most likely are unaware of the reasons for salary differences, including education, experience, training or negotiating skills. Suspicion, distrust and other negative emotions often result from salary discussions and seriously affect company morale.
The best way to head off those problems is to foster a positive working relationship with your employees. Consider instituting strategies like these:
- Pay people fairly in the first place – auditing your own records and making sure your salaries are competitive in the marketplace.
- Encourage a workplace where employees are comfortable approaching management or HR personnel with questions or observations about salaries or working conditions.
- Help employees understand their salary ranges and job potential, and teach them how additional skills, training or certifications could possibly affect their growth within your company.
- Provide resources and training for management so they are aware of labor rulings and know how to respond to employees’ questions and requests.
- Put together a complaint resolution procedure for your company that allows employees to be heard.
- Conduct internal surveys that monitor your company’s general climate, employee engagement and compensation perceptions.
If you’re like most companies, your employees are the backbone of your organization. Mutual trust and the feeling of being valued can go a long way in heading off problems before they escalate. With the guidance of your HR representatives and management, you should be able to handle whatever issue comes along.
How can you get the scoop on employment laws that apply to your business? Download our free e-book, Employment Law: Are You Putting Your Business at Risk?