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keobooks's avatar

Why do so many jobs want employees to keep their income secret?

Asked by keobooks (12461 points ) February 10th, 2014

I had a friend who recently accidentally discovered the payroll records of all of her employees. She was so surprised to find out people were getting paid greatly varying sums to do the exact same job. She also found out some of her subordinates were making more than she did.

I don’t get this at all. I’ve always worked for the public. In schools and libraries, the salaries of the employees has always been up for public record, even though it’s not easy to find. It’s always had a formula. A teacher with this degree and this many years of experience will earn this much money. I assumed that in other jobs everyone was pretty much making the same amount of money for their jobs.

It turns out it isn’t true. Why are salaries so secret in many businesses? I don’t understand this at all. I wouldn’t like to find out that my assistant made more than me.

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22 Answers

tinyfaery's avatar

To keep peace with their fellow employees. If everyone knew how much everyone else earned, people would become jealous and resentful. Then everyone will watch how much everyone else works and the general work atmosphere will become toxic.

keobooks's avatar

But it’s not that way in libraries or schools. I can look up how much anyone makes—maybe not “Bob Smith makes 43k a year” but if I know Bob has a PhD and 15 years of experience and is a department head, I will know he makes 43k a year. There’s no mystery or secret about it.

tinyfaery's avatar

@keobooks My wife’s school district is the same, but people do compare the amount of work others do, and it does cause resentment.

livelaughlove21's avatar

Q: Why do so many jobs want employees to keep their income secret?
A: ...people were getting paid greatly varying sums to do the exact same job.

You answered your own question. Why would the company want you to know that you’re getting paid less than your co-worker even though you may have been there longer and be better qualified for the job. What good would that do?

ARE_you_kidding_me's avatar

Private sector salaries vary so widely that it’s best to keep them confidential.

keobooks's avatar

I think I get it. After being in the public sector so long it never made sense to me since it wasn’t an issue. I am also surprised about the income inequalities. Why would someone make an astounding amount more than the other for doing the same job? I don’t get that at all.

tedibear's avatar

Some of it depends on how well the person negotiated their starting salary. If I am willing to take $40,000, the person hired after me doing the same job might negotiate and get $45,000. I was willing to take 40K, the other person wanted 45K and the company was willing to pay that. In private enterprise, you try to get the person you want for the lowest reasonable salary.

JLeslie's avatar

In the public sector people are often paid for time served and how many degrees they have and not on a merit basis. In the private sector people are paid to some extent on how well they negotiated their salary, when they were hired (sometimes new employees are briught in at higher salaries than the people already working in the position) and how good a job they do. Companies should have people at around the same level making around the same amount of money within certain limits, but that does not always happen. Good companies evaluate if people within the company are being paid justly, they look especially for discrepancies for minority groups, and if the salaries are competitive in the overall marketplace.

If I know I get paid $10k less than Suzy and do the same work, it probably is going to piss me off. In every company there are some people who are underpaid and some overpaid.

When I was a manager I twice fought to get my staff higher wages or commissions, bceuase they were making so much less than some of their counterparts. I got it done both times, but it took them bringing it to my attention and me fighting for it. They brought it to my attention and knew they were underpaid because they did talk to each other about their earnings. I think employees should do it sometimes, to keep the employer in check. It depends on the situation and the evel of the employee.

keobooks's avatar

Is there anything you can do if you find out you got lowballed? Or are you locked in that salary for good?

Cruiser's avatar

Compensation of an employee is often reflective of a myriad of factors and two that I see play the biggest role is level of education and amount of experience.

tedibear's avatar

You can negotiate for a better salary if you find out that someone else came in at a higher rate. However, I wouldn’t mention that you know Suzy Q is making X dollars. That could cause potentially uncomfortable questions for both you and Suzy.

JLeslie's avatar

@keobooks As I said, my employees came to me and pointed out they were being underpaid and I was able to get them increases.

Sometimes an employee needs to leave their company to get what they should be paid, either the new company pays more, or sometimes the current company will pay more to keep the employee.

pleiades's avatar

@keobooks Ask yourself why your friend was, “surprised.” My best guess would be that your friend had judgmental opinions about some of those numbers when it’s not your friends job to be judging those pay rates.

Put simply it’s no ones job but the manager/ceo of the said employer to manage the salaries.

I 100% agree with @tinyfaery

SQUEEKY2's avatar

Hence the needs for evil unions to keep it all on a level playing field,a number of years ago was with a company and they hired this guy I had to train and found out they hired him for a $1.50 an hour more than they were paying me,i wasn’t impressed the next year our company went union,and have been with union shops ever since.

Pachy's avatar

I know from experience both as an employee and a manager how hostile the work environment can get when employees know other employees’ salaries. When you know how much more or less a co-worker makes you can never relate to them in the same way as before.

tobycrabtree's avatar

I think it is because of salary negotiation and confliction between employee and company

Linda_Owl's avatar

It is because the Employer gets away with giving very few raises… so the employees are urged to keep their income to themselves.

Paradox25's avatar

Usually I see this with non-union companies that offer competitive wages. The reasons to me are very obvious in this scenerio, because a more qualified person, or somebody with more education or performance ability should get paid more. My fellow co-workers do not need to know that I’m making more than them.

SQUEEKY2's avatar

@Paradox25 I understand where your coming from, but if your both hired to do a certain job that takes a certain skill and you both have that skill, why should you or them be paid more just because you have more education?

tedibear's avatar

@SQUEEKY2 – I would rather have the ability to negotiate my own salary than to be told “you can only earn this much.” I don’t want to watch a slacker make the same amount of money when they do less work than I do. I’ve seen it happen, too. One person works their tushy off, the other doesn’t, and they both make the same money.

keobooks's avatar

Being part of the public sector all my professional life, the earning formula has never bothered me. I think it’s odd people take their salaries so seriously. As long as I’m earning enough to live comfortably and making about the same as everyone else doing my job, I don’t really care.

Paradox25's avatar

@SQUEEKY2 For the most part employers have no special reason to discriminate based upon sex, race, ethnicity, etc. Companies will do what they need to in order to make a profit, so I would not understand how an employer discriminating against a person (paying them less for example here) would benefit the company in the end.

From my experience people who usually get paid more for ‘doing the same job’ as others usually deserve it. It’s not just about education and qualifications, but also work ethnic, dependability and actual performance. Now I have seen exceptions, but those companies were usually rat holes where an incompetent lower management catered to certain people, and the types of places where I lasted like a month (if) before just walking out on them.

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