The world of business is full of mergers, acquisitions, and downsizing; realities that drive layoffs and challenge the basic human need for security. That said, amongst the chaos and unpredictable change there is one basic thing over which every business has control: fair pay. Fair pay is the #1 engagement driver that businesses ignore.
Fair pay means just that: you need to pay people fairly. If you have two different people in the same position, doing the same job, responsible for the same initiatives, pay them the same starting salary. If you have people being paid completely different salaries when they start, that’s not fair pay, that’s evil. It’s doesn’t matter how well one person negotiated. If you pay people differently for the same exact role, it’s evil. You might be thinking, Experience, education and performance plays a role when it comes to pay. Yes, all of those factors should be considered when offering someone a position in the business. And yes, your employees should be also be rewarded for great performance. So here’s the deal: Figure out all those initial factors, and then determine the salary at which everyone starts when they accept the role, and only hire people that fit those determining factors. Hiring exceptions can be made, but people still need to start at the same salary that everyone else received upon accepting that role.
I’ve worked with countless businesses that have multiple people doing the same exact job, yet making different salaries. In those instances some people are making thousands less than others, because the person making the hiring decision felt that one of them deserved a higher salary. In professional roles, I’ve seen salary variances upwards of $100,000—that doesn’t even begin to address the realities at the executive level. I’ve seen businesses try to get away with “salary bands” that justify a $30,000+ swing for the same job that required the same experience and education. This has even become a game—I’ve played it. Here’s what you do. You accept a role, and while in the role have a few conversations with friends to figure out the top salary for the position you hold. Then you perform really well for a while—let’s say you do this high-performance thing for a year, sometimes less, then quit. A few months later, you say that you changed your mind, negotiate for the top salary, and voilá—you’re now the top paid professional in that role. This happens everywhere, in every industry, and at every level.
Salary ranges and the emotion of resentment from those being paid less fester like a bad disease, and negative energy continues to be dumped into your business. If you’re not offering equal financial packages for everyone in the same role, you’re discriminating. It doesn’t matter what the “salary bands” say, or what industry standards indicate—they’re wrong. Don’t be evil. Don’t discriminate. Honor fair pay by paying people who are in the same role the same salary—period. If you don’t, you are choosing to pump negative energy throughout your entire business. If you’re not paying people in the same role fairly, you’re making a statement to the business that disengagement is okay and you’re sacrificing a high-performing culture along the way.
Gina Soleil, is a speaker and acclaimed author of Fuel Your Business: How to energize people, ignite action and drive profit. She blogs and speaks about how to create a business where people are energized, feel good and are happy. Visit Gina Soleil and follow her on Twitter.