Are you allowed to talk about your salary and employment conditions with your co-workers and other persons?

Hi guys, I just received an email from the admin and hr manager from my company stating some terms has been added to our company's policies and procedures manual - "your salary and other employment conditions are confidential and must not be dicussed with other employees within the company or other persons outside this company (with the exception of your legal and financial advisors)"

I'm just wondering if you guys have any similar rules in the company you work for?
Is this legal or reasonable for the employer to add such terms?

Comments

    • +40 votes

      Common sense for the company to try and enforce? Of course they don't want the person being paid least in the team to know they are being remunerated less for the same work.
      I would be interested if such a clause has ever been enforced.

      •  

        Highly unlikely to be enforced but the deal is this:

        If you are being paid at or higher than the award rate, in the instance of those covered by an award, then the company is well within their rights to pay someone else who performs the same duties a higher rate than you. This would apply for Entry Level through to Mid Management.

        If you are not covered by an award then you get what you have negotiated and are free to leave under the exit terms of the contract you are bound by. This would apply for Senior Management.

        Scenario:

        X and Y perform the same duties at work in the same position. X performs twice the amount of the same work at the same quality of Y. X gets paid more than Y. Both X and Y are paid at or above the award rate.

        Do you believe that this is fair?

        • +12 votes

          Do you believe that this is fair?

          Who knows if it is fair, but the company seeking to stop the information being revealed presumably thinks the lower paid party will view it as unfair. If they had a concrete reason for the discrepancy they wouldn't be so concerned if the details became known.

        • +1 vote

          @mskeggs: Hertzberg's two-factor motivation theory identifies Salary as a hygiene factor. So yes you are correct but this would be inline with their reasoning.

        • +25 votes

          In my experience salaries tend to be tightly linked to the length of one's employment, not how much work they actually do.

          I'm a big proponent of salary information sharing - it benefits most employees, at the expense of the employer.

        • -2 votes

          @railspider: Sure there is typically a correlation. What I'm trying to get at though is that discussing your remuneration with your peers, especially if it differs, is going to leave someone feeling worse off. As a result, the policy attempts to curb the practice and undesired outcome (it's not as if the business is paying you less in spite of you). Remember that so long as the employer is paying at or above award rates, you have little recourse to go running to HR demanding a pay rise. While this may seem unfair or even unethical there are arguments to be made that this policy may also be protective to the employee and also serves to preserve employee motivation for the benefit of the company. I also am a proponent of salary sharing as my take is that if someone is performing twice the work of another than the person not keeping pace needs to improve else risk being dismissed. Equal pay for equal work - and I mean that in a literal sense. Furthermore, take into consideration the employers perspective … why should they pay you more than what they have to in the first place? If you were the employer the chances are that your opinion would be very different than if you were the employee.

          It's a good discussion to have nonetheless.

        • +5 votes

          @kywst: It's a fun discussion to have, because I agree with you - employers and employees have very different incentives.

          As an employee: I know from personal experience that seeing colleagues salaries can be de-moralizing, but it can also be a useful tool when negotiating for a pay rise.

          From an employer’s point of view: I want to pay people as little as possible, while still keeping them happy and motivated. Salary secrecy helps me achieve this.

          Now considering Australia is in the midst of record low wages growth, perhaps we are in need of a little more salary sharing!

        • +4 votes

          @railspider: It is concerning when your yearly adjustment is that of yearly CPI. This appears to be becoming the norm for many and essentially relays "your ongoing service (experience) means nothing to us". I blame the 2008 GFC hype pushed by the media and warmly embraced by corporations as a "reason" to do just this. 9 years later and people have been conditioned to think we are in a perpetually terrible economic disaster hence they accept.

        • +1 vote

          @kywst: Thanks for that reference to Herzberg, I find that so interesting - somewhat like Maslow's Hierarchy of Needs but with a twist.

        • +1 vote

          @railspider:

          In my experience salaries tend to be tightly linked to the length of one's employment, not how much work they actually do.

          In my experience, salaries often depend on negotiating skills. Someone who demands a lot and threatens to resign if they don't get it are likely to get more pay rises than someone who is shy and introvert and just says yes to whatever they get offered. Even if the latter one does a better job.

        • +1 vote

          @MrTweek: It's definitely a bit of both, and before I started working fulltime I thought my payrises would be 100% based on my negotiation abilities.

          But in reality I've had bosses tell me point blank: Employee A may have a lesser role/responsibility, but they've been here 3 times as long so they've earned a higher salary.

          Every boss & workplace is different, but time in chair certainly seems to be a big factor in pay rises.

        •  

          @railspider:

          In my experience salaries tend to be tightly linked to the length of one's employment

          I'm actually seeing that is true, but not how you'd expect - I've started doing more of the management/hiring at my job, been here for 5 years, and our new hires are getting more than the guys doing the same job who have been here for 12+ months. It costs more to get a new employee than to keep an existing one.

        •  

          @MrFunSocks: Especially when you take into consideration they are ineffective for at least a few months.

          It costs more to get a new employee than to keep an existing one.

          It's a good thing you know this.

        •  

          @kywst:
          What's a yearly adjustment?

        • +1 vote

          @BartholemewH: Having not punished the porcelain in 365 days.

      • +2 votes

        When I first started work I had 7 other employees all start on the same day as me with the same qualifications, we compared payslips and we'd all been paid different amounts…we took it to HR to figure out and got solidly reprimanded for discussing it with each other and warned that we shouldn't do it again! And the erroneous pay was their fault in the first place, no apologies given…

    • +3 votes

      That's some A class BS. It allows the company to pay workers doing the same job different amounts, without the workers having any clue that it's happening, and therefore organising against it.

    • +1 vote

      That nonsense. It's not a contract it's a company policy. Not a very effective one anyway: you are free to ask anyone for legal or financial advice.

    • +1 vote

      Typical anti union clause…they don`t want anyone finding out they could get more money if someone else is getting more…

  • +19 votes

    Hahah that is their way of keeping the underpaid quiet.

    Personally I found Gen-Y is open to the discussion, most other people find it rude to bring up (I am also Gen-Y).

    •  

      I didn't really think about it in the first place until my company brought it up by adding those terms.
      The pay my company offers now is relatively low compared to others in the same industry though…

      • +2 votes

        They are paying some people more and don't want to bring up to parity the salaries of the rest. In general that means those there a long time are getting screwed.

        Time to push for a pay rise, and/or find another job.

  • +1 vote

    More like encouraged not to.
    If you cross the red light but no cameras and no police, you are not guilty. :)

    So how much do you earn?

  • +2 votes

    All people that commented here should be guilty of the policy then?
    https://www.ozbargain.com.au/node/198961

    •  

      how many of that thread are coworkers?

      • +1 vote

        must not be dicussed with other employees within the company or other persons outside this company

        Irrelevant right?

        • +1 vote

          in that case

          one can simply just argue that everyone on OZbargain is my financial advisers (even legal advisers in some cases)

        •  

          @humdingaling:
          Maybe they need to say "professional financial or legal advisers"?
          Aaah yes, on Ozbargain we ARE professionals (just ask Gerry, but don't tell him your salary)….

  • +17 votes

    youre probably underpaid.

    • +1 vote

      This email has been sent to everyone in the company but my company has a history of being not very transparent about remuneration and employees rights though.

  • +1 vote

    They can't just add shit in like that, if it wasn't on something you signed already.
    It's either unenforceable or was already part of your contract.

    • +2 votes

      Your contract will contain a clause that makes you agree to company policies and procedures. These policies and procedures are subject to change. It would appear that this isn't an addendum to the contract.

      • +2 votes

        Technically true, but the point is still open to discussion.

        Besides that, I don't see how something like this could be enforceable.
        You could get called in to the manager's office, door closed, and told to shut your trap.
        And worse case, they can make a BS excuse to fire you.

        Either way, this clause does nothing for the workers and is only there to benefit the company.
        It's very hypocritical when the same company praises communication, and uses "lack of communication" as excuses to fire people.
        Companies just want to have their cake and eat it too… someone who's intelligent and brave wouldn't be stumped by this practice though.

        • -2 votes

          If you're contract says you must not breach company policy and you breach company policy then I fail to see the need for a BS excuse as you are, in effect, in breach of contract. It is highly unlikely that this would be enforced as pointed out above but the employer would have a strong standing in the courts if that's where it ended up.

          I've explained above how it can be argued that this does actually benefit the employee; regardless if you personally feel "the man" is on your back. Being intelligent and brave has absolutely nothing to do with it … actually if someone were intelligent they probably wouldn't be in a position where they were being underpaid/care for discussing their remuneration anyway as surely they would be skilled and competitive enough to negotiate well.

        • +4 votes

          @kywst:

          You're right they wouldn't need a BS excuse (in theory)
          Sure, and that's where they could cite to fire you.
          You would take them to court.
          And ANY judge would side with you, the worker, on the matter and throw the book at the company.
          Companies know this… they wouldn't want to take it that far.

          Intelligence is not a one-dimensional category.
          You may be intelligent in knowing your rights, your wits, etc etc but not be intelligent to market yourself.
          So an intelligent person, and someone brave, can/would object this.
          I agree with you that such a person would even put themselves in such a position, but WHEN it happens, I know this clause would NOT be enforceable by the workplace. What you sign on the contract isn't always cut-dry, things can be altered and disputed even after signing. Hell, we do that everyday with the LAW and that's practically a contract people abide by to live in this land.

        • +4 votes

          @Kangal: I suggest you seek legal advice before engaging in this practice. I'd hate to see you out of a job because you thought you were taking the moral high ground while truly believing a judge would interpret the law in your favour. You don't know that it wouldn't be enforced and you also don't know that a judge would side with you.

          Feel free to check out the Fair Work Act 2009 - General Protections.

          I admire your resolve but fear you may get yourself into strife should you decide to test the waters.

        • +2 votes

          @kywst: Some companies appear to imagine their policies can replace or over-ride legislation and regulations. They don't. They are a wish list that can and will be assessed by the courts or tribunals if and when they are challenged.
          Try running it as the argument that you enter a contract when purchasing a product, so if you don't like the warranty, you are free not to purchase that product - and that it the sum total of your rights.
          A similar case arises with the " may not work in a similar industry for [X] years after leaving employment." clause that some companies have. they rarely stand up for more than 3 seconds if challenged when the employee leaves, apparently even when they are part of a governing party's code of conduct for ex-ministers…

        • +2 votes

          @kywst:

          If you're contract says you must not breach company policy and you breach company policy then I fail to see the need for a BS excuse as you are, in effect, in breach of contract. It is highly unlikely that this would be enforced as pointed out above but the employer would have a strong standing in the courts if that's where it ended up.

          It's not that easy. You can't put anything in a company policy that you wish, they need to be legal and reasonable and not drastically change anything you signed in your contract.

          Some examples that make it absurdly obvious what you can't put in a policy:

          • Every employee is expected to work at least 3 hours overtime per day.
          • Management reserves the right to cut salaries by up to 30% without specifying a reason
          • Management is entitled to punch every employee in the face once a week

          So yeah, while talking about salary might not seem that unreasonable, it probably still is.
          I need to disclose my salary whenever I rent an apartment, get a home loan, apply for a credit card, make a tax return, and much more. I can't imagine a policy that technically prevents me from doing anything of this can ever be enforceable.

        • +1 vote

          @terrys: non competes are a different can of worms. I agree completely (from the outset) that discussing salary with employees will most likely not be actioned against but if it did then it'd probably work to the employers advantage.

        •  

          @MrTweek: employment law is very grey but I can't see this as being unreasonable. You are correct even though you resort to hyperbole to support your point. It's also specifically discussing with other employees. Sure the buck has to stop some where.

      • +1 vote

        In the end they can say whatever they like, it wont be enforceable.

  • +15 votes

    i hear if you talk about your salary to co workers you will instantly burst into flames

  •  

    I've asked an HR professional of 30+ years and they said "This isn't illegal. The amount of times I've had someone come into my office stating they know that X is being paid more than me …". To which the response is "You're not telling me that you've been discussing this with your colleagues as company policy directs you not to, are you?". They then reasoned that this is a far nicer way of saying that "Not everyone everyone gets paid the same and again this isn't illegal. Perhaps X is a higher performer or in the talent pipeline and you are not."

    • +2 votes

      You're not telling me that you've been discussing this with your colleagues as company policy directs you not to, are you?

      Do people fall for this? If someone else tells me their salary, they might breach the policy, but I probably didn't.

      But technically it could also have been a third party that told me how much "that guy" makes, internal or external. So while there is a chance that someone breached company policy, it was most likely not me and it's impossible to find out who it was.

    •  

      I always love the double negative. Its the

      'I wouldn't go so far as to say it is legal (as far as I know) but then again it also isn't illegal (as far as I know)!'

      You know what - it's reasonably legal :)

      •  

        People let emotion drive their response. Thanks for voicing some reason. I sincerely hope someone doesn't link your "love" of double negative to emotion now. =/

  •  

    Don't worry. Quoting parts of your contract online is probably just as big a breach if it says confidential anywhere on the contract. :p Demonstrating a financial loss would be impossible so it just means if they were looking to sack people anyway, they could choose you for breaching contract.

    •  

      That's a standard generic clause in any employment contract , HR people tend to google this stuff (the HR people I've worked with anyways)

  • +11 votes

    I talk to my colleagues about the $180k I earn and they feel open enough to tell me they are on $180k as well.

  • +1 vote

    Only to those who are my close friends as it can be a bit controversial. Either way, someone's not going to be happy about their situation.

    Everybody thinks they are above average. See this link on driving and this on Illusory Superiority. For skilled professions mostly, no two people are going to be the same. Someone's bound to be more talented, hard working, disciplined, or just a better fit. Some people spend more time managing their careers or are more politically savvy. Some people are more lucky.

  • +1 vote

    The problem is that this sort of thing is how bias and cronyism continue to flourish; the person who is the highest paid isn't, necessarily, the best person for the job. There are many ways a manager can "play" the system to make sure his/her pets are the ones earning the bucks.

    • +1 vote

      Yes quite often the highest paid is the least suitable for the job. No threat to the manager and makes him look good

      In fact most managers aren't suited to the job and are the cause of most failed businesses

  • +2 votes

    Probably just adopted Fight Club rules.

    Sounds like 7/11.

  • +1 vote

    It's standard, but almost impossible to enforce unless someone's silly enough to tell HR / Management that employee X told them they're earning Y amount.

  • +2 votes

    I work in public service and everyone knows how much everyone else gets paid, practically.

  • +4 votes

    So are they saying you can't tell your partner what you get paid. How about if you go for a loan, can you tell them??

    Sounds like a crock to me

    • +11 votes

      From OP's post: "…with the exception of your legal and financial advisors)"

      I'd say most wives will fall under the category of "financial advisors". haha

  • +3 votes

    I work for a quasi-gov department and every one is graded by their position so I know exactly how much every body makes. They even publish payment rates on the internet.

    • +3 votes

      We've been told by upper management, after a satisfaction survey, that private companies generally wouldn't do that as it would give other companies ammo to poach staff. It makes sense, but is it just a case of the man trying to keep the peasants in check?

      • +12 votes

        definitely a means for the bourgeoisie to oppress the proletariat.

      • +2 votes

        One of the things that came out of the black death was an improvement in the conditions of the peasants. Suddenly there was a shortage of people to work the land so there was more value placed on the peasants work. It was one of the catalysts for the downfall of the Feudal system. (Not that I'm advocating a worker cull.)

  • +13 votes

    This is your boss. You are technically in breach of your contract for discussing your employment condition (of confidentiality) on ozbargain. Come and see me in the office tomorrow.

    • +10 votes

      They are my financial advisors, they have ever suggested me investing in eneloops and 80k car and I think that's some nice investments. I will wait my investments go up and I will be your boss one day!

  • +8 votes

    I would like to draw your attention to this: https://www.youtube.com/watch?v=7xH7eGFuSYI

  • +3 votes

    I doubt it's legal but if it is then they aren't going to fire you over it if you're a good employee.

    I once found a spreadsheet on a share drive with everyones' wage on it in my area (area 45 people). It was very useful for pay rise negotiations next year as I could estimate what they would pay me.

  • +2 votes

    keeping salary a secret only works in the company's favour.

    however some people get jealous so only share if you and the other person will gain from it.

    • +1 vote

      However, it is a neat "out" when the next "potential" employer asks what you are being paid in your current job. "Sorry, I signed a confidentially agreement on that".

  •  

    You don't have to sign it

    But if you like your job then there are conditions

    It is a legal contract though and whilst you may be able to do it is it ethically right to do so

    •  

      If you are going to ask that you should first ask is it ethical for the employer to impose such a measure on (existing) employees.

  •  

    Sign it and break the rules because you don't have to follow any unfair rules towards employees as it will be against your own interest. If you are caught, apologise about it. If you are sacked for that then you will be in the same position of not have signed the contract. Go ahead ! Maybe you can take him in for unfair dismissal even.

  • +6 votes

    But they don't say anything about publishing your salary anonymously on Glassdoor.com…

    https://www.glassdoor.com.au/Salaries/index.htm

  •  

    Your remuneration forms part of your employment contract. Your employment contract is confidential.

    Assuming you're working for a private company - the company has a legal obligation to fulfil employee rights but they are not under any obligation to standardize pay. It is not an employee's right to receive the same remuneration as their (perceived) peers.

    •  

      Your employment contract is confidential.
      But only if explicitly stated on the contract? Mine doesn't contain such a clause.

      they are not under any obligation to standardize pay.
      Being allowed to talk about salaries and expecting to have standardized pay aren't the same thing.

      It simply puts employees in a better position for salary negotiations, which is something most companies don't like.
      So many times I've heard "sorry, I can only give you x% more because you already make more than most of your colleagues." Many times I found out later on that this was a lie.

      •  

        How does putting employee's in a better position for salary negotiations help the employer or the company?

        Negotiations works both ways. The employer is not obliged to serve the employee leverage on a silver platter.

        The best way for an employee to get a better deal is to be difficult to replace (if your work ethics allow) or show you are a stronger contributor, or to prove that further incentives will improve your motivation and performance.

        The best way to be put in cold storage/made redundant is to demand a higher pay because, "me mates are getting more."

        • +1 vote

          Negotiations works both ways. The employer is not obliged to serve the employee leverage on a silver platter.

          That's an interesting point of view. I wouldn't compare allowing people to talk about their salaries with "serving leverage on a silver platter".
          Publishing everyone's salary could be, but this is more a matter of suppressing information that shouldn't really be suppressed.

          I'd say, since this is MY salary I should be the one to decide whether I talk about it or not.

          The best way for an employee to get a better deal is to be difficult to replace (if your work ethics allow) or show you are a stronger contributor, or to prove that further incentives will improve your motivation and performance.

          Ideally that should be the case, but I'm sure there are plenty of companies who are happy to underpay top performers that simply don't know what their work is worth. Not letting them talk about it is a great way to keep this status quo.

        • +1 vote

          @MrTweek:
          Sadly, I agree that there are lots of companies that underpay. These places are never worth staying in as a good company keeps great employees.

          Great employees are proactive and autonomous, and these employees won't stick around waiting for negotiations to go nowhere.

          Finally, I'd say that this is MY company and I drafted the contract of employment so I should be the one to decide if it is confidential or not.

  • +1 vote

    I can't believe the 'U-Word' hasn't been mentioned in this thread yet.

    If this sort of practice bothers you at all, there's no reason you shouldn't be a member.

  • +3 votes

    A policy like this is solely to the employer's benefit - plain and simple. As an employee - knowing whether you are paid more, the same, or less than others in your company doing the same work is empowering and makes your future choices clearer. Whether that is leaving, negotiating a payrise, working harder to earn your keep, or working less hard to reflect your lower pay. I have no idea whether it is enforcable, but unless you were stupid, they'd never be able to prove you broke that policy.

  •  

    This appears an unethical clause,
    however I guess you could talk to anyone and deem them an 'adviser' (legal or financial).

  • +5 votes

    Nothing the company does is ever in the interest of the employee, except for where their aims intersect for a time. (Ie employees dont like being sexually harassed, companies dont like being sued, hence sexual harrasment policies)
    If you dont like something that a company does, or you want independant advice, you should talk to your colleagues about working together with your collective power. It's called a union.

  •  

    Don't talk? then text to your co workers then

  • +4 votes

    I heard somewhere that this sort of thing contributes to the salary gap between men and women. That women tend to obey these policies more than men, and the sharing of salary information between men gives them a better baseline and data from which to negotiate their own salaries.

  •  

    It's a power and control thing, not surprised they have salaries on the lower side of the industry. With this cultural insight I'm sure they're not the most efficient and effective organisation either.

    The reality is the differentiation in salaries are a reflection of an individual's negotiation skills, not their performance.

    The really forward thinking orgs are moving to open salaries: https://open.buffer.com/introducing-open-salaries-at-buffer-...

    Anyhow, tell them to bugger off.

  •  

    Would the company not have to prove that you told someone?

    For instance, let's say someone is trying to make life difficult for you and is able to get a hold of some basic deets about your pay, then approached the big kahuna of your company claiming that you told them your pay, how would you prove otherwise?

  1. mskeggs on 20/03/2017 - 13:25
  2. railspider on 20/03/2017 - 16:42
  3. Gunther on 20/03/2017 - 12:37
  4. tuzii on 20/03/2017 - 12:52
  5. redfox1200 on 20/03/2017 - 13:02