The salary history question has been a staple of job interviews for as long as I’ve been interviewing. This year, Massachusetts eliminated that question in one equal pay law, which goes into effect in 2018. There is also a salary history law making its way through the U.S. congress, although it’s unlikely that a federal salary history law will pass the new administration. While employees are jumping for joy and money, companies are less enthusiastic about prohibitions of the question. Here are 3 reasons I think it’s a good idea to drop the salary history question from your interviewing practice, whether you’re required to or not:
#1: Embrace the intention behind removing the salary history question
Some have linked the salary history question to perpetuating the gender pay gap. The thinking goes that if people have been routinely discriminated against because of gender, race, or ethnicity, their pay is likely to be lower over time.
This gets at the opportunity gap, in addition to the pay gap, between genders. Recent PayScale data has been able to dig into the uncontrolled pay gap between men and women; it uncovers some compelling data that both men and women are likely to look for a new job if they don’t perceive their organization is taking steps to address workplace gender issues. It’s a perception issue, at this point. Top companies, in a competitive market, may want to demonstrate their commitment to fair pay in order to keep their best people. And in the case of the salary history question, a commitment to fair pay may help attract the best people too.
#2: Let the market guide your compensation offers
Perhaps the intention behind removing the salary history question doesn’t speak to you or your company values. Here’s another compelling reason to drop the question: with so much market data available to employees, they are coming to interviews with compensation data reports in hand. The trick to that is that they don’t always have the right compensation data. Maybe your organization is in a rural area and they are bringing data from a major metropolitan city across the country. Maybe you’re a smaller organization and they’re bringing data from some of the largest employers. Or perhaps you’re a non-profit and they’re bringing tech industry data to validate their preferred salaries.
You have to get ahead of the data game by bringing your own competitive market compensation data to the interview process. Knowing, and discussing, the numbers can help increase trust between candidate and recruiter, future employee and organization. Data that employees can access isn’t always packaged for business use. When you identify your market data points, you’re making some key choices about how you prioritize pay in your organization, whether you know it or not. Do you pay for performance? Do some functions merit more than others? Are you trying to grow a particular team and therefore willing to pay more for that? Or maybe you’re trying to conserve in one area to pay for the rest. All those choices play into the compensation data you obtain, which makes it even more important for you to let the market guide your comp choices.
#3: Let your pay brand drive your decisions
The way you pay says a lot about you. During the interview process, the way you communicate about pay says much more than “here’s what we plan to pay you.” Whether overtly or not, you’re passing along information about how your organization makes decisions about pay, how open your organization is to discussing the rationale for pay, and ultimately how transparent and innovative your organization is about rewarding employees. Asking “what’s your salary history” sends the message that your organization is stuck in a rut of asking the same questions over and over. You’re the type of company that tries to haggle employees down and pay them as little as possible. Is that the type of values you’re hoping to project? If not, your candidates will see right through it. Drop the question.
On the other hand, remember that more communication doesn’t necessarily mean more money. In fact, a PayScale study found that 82% of employees are ok with lower pay as long as they understand the rationale for why. Communication matters. Having fact-based, data-driven conversations about pay is a great way to start out an employment relationship. It says we respect you and we value you; let us show you how we value you.
What legacy interview questions are you still holding on to? We’re curious to know! Share in the comments section below.