Personal finance

How to use pay transparency to negotiate a better salary

New laws are making it easier than ever to know how much a given job pays. Pay transparency legislation is gaining momentum in cities and states across the country, from New York City to California and Washington state.

Being armed with information about the salary range for a position you’re interested in can be the starting point for having a successful negotiation about more than just pay, experts say. 

“You want to get as much information as you can upfront about the role, the reporting structure and how they’re thinking about compensation,” said Alexandra Carter, a professor at Columbia Law School who teaches negotiation skills. 

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Information is power

Job seekers can use an employer’s disclosure of the salary band for a given position to ask more questions.

Carter, the author of “Ask For More: 10 Questions to Negotiate Anything,” cited question examples such as “What will be required of me in the role?” and “How are you valuing within that band?” “

Use “tell me” questions to understand how companies come up with pay structures and qualifications required for the top of the pay range, she said. 

Establish a relationship

The tone of the questions themselves is important, too. “You’re looking to establish rapport and establish a relationship that’s going to take you not just through this one negotiation, but a year or two later when you’re asking for a raise or promotion,” Carter said. 

Negotiate on more than salary

Consider what you want out of a job, and remember that companies may have more flexibility on benefits than pay. Perks such as flexibility in hours, remote work, paid time off, mentorship, travel and professional-development conferences can add significant value. 

Use pay transparency when negotiating a raise

Knowing what others earn can also help if you want to negotiate a pay raise or promotion.

Sixty-eight percent of organizations plan salary increases for all workers in 2023, according to a survey of U.S. corporations by the International Foundation of Employee Benefit Plans. Survey respondents said performance is the greatest factor used to differentiate between worker salary increases. 

Pay transparency laws may make it less likely employees will need to go out on the open market to know their worth.

“A lot of times, employees really don’t have a sense of their market rate,” said Ben Zweig, CEO of Revelio Labs, a workforce intelligence company in New York City. Without posted salary information, the only way employees often find out their value is once they start interviewing and meeting with recruiters.

“That’s very wasteful; it’s very inefficient,” Zweig said. “Certainly firms don’t want employees doing that.”

Moving the conversation forward

Pay transparency may also help negotiations move beyond salary into how an organization should change a job to improve employee satisfaction. Experts say business leaders and hiring managers should understand that employees may put a higher value on fairness than the actual pay.

“Compensation won’t be the ultimate prize for doing well on your job,” Zweig said. 

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