The Muddy Waters of Salary Transparency

Recently there has been much comment and debate around the issue of salary transparency in organisations. The New York Times columnist Lisa Belkin published an article on this very subject in August. Like many arguments in the world of employment there are pros and cons as you would expect. For those on the pro transparency front the case is a simple one.

1. Salaries will become more fair. The system gets a chance to adjust itself. (This argument is often given a more inclusive flavour with a smattering of diversity thrown in for good measure - "We will be able to see that women are paid fairly" - I've not heard this salary/diversity measure argued by any of the women in my organisation, and to me it smacks of validation)


2. It will be easier to retain the best employees because they’re more likely to feel they’re getting a fair salary.

3. The pressure is on the people with the high salaries to earn their keep. Everybody has to pull their weight - the higher the salary, the larger the weight.

4. Secret salaries can create paranoia and mistrust between peers (is he getting paid more than me?)

These are an amalgam of points, by no means exhaustive, taken from internal discussion and the wider blogosphere. I think the majority of the pro-transparency arguments are covered here. They are in no particular order and I hope to expose some of the counter arguments and the mis-thinking behind them.

Putting it right out there in the open I am against salary transparency. I feel there is little to be gained, when an organisation has reached a certain size and covers different geographies, in the widespread disclosure of salary information. The arguments in favour of keeping this information private far outweigh the perceived benefits, and in my opinion too many of the people arguing for the release of this information use equality as a soapbox for their own issues with their personal salary. As you will see, I postulate that this is an example of a very different outward agenda for what is essentially a personal issue.

The first and most important part of the argument against salary transparency is one of privacy. The advent of the Internet has meant that a wealth of information is already freely available to the casual surfer. With one reasonably refined Google search I'm confident you could find my mobile number, home address and probably my now dead pet Gerbil's name*. Is this a good thing? Some would argue yes however there are some things I might not like to disclose - salary is one of those things. People may say it’s my bourgeois middle-class white upbringing that leads me to think it impolite to discuss salaries but I don't believe that's the case - as a recruiter I discuss salaries everyday, constantly and all the time. I am happy to talk about this in exact figures and not to think myself crass for doing so. It’s a taboo I’m happy to break. However I think there are genuine relevant reasons for not disclosing one's salary. Despite any organisations attempts to maintain a flat structure people function through the constant comparison of themselves with others - in knowing a salary structure of an organisation do you immediately assume that those with a lower salary are less valuable? I'd make the challenge that yes as salary would be the only insight you have into the role played by an individual in that organisation. In my opinion salary is not a measure of value. If I'm bleeding to death I'd wager I'd not be concerned with the salary of the paramedic stemming the tide of blood, but his value at that moment would be priceless. Nurses and Care Givers are paid less than Investment Bankers and Police Officers less than the latest “celebrity” to leave the Big Brother house – value and moreover personal worth should never be measured in pounds, shillings and pence.

The issue of “fairness” is an interesting point and in certain organisations I feel would apply. If we take the example of a manufacturing plant and compare two workers performing the same task on the same line at the same time – then it would be unfair of an employer to make this same role tiered in terms of pay, I’d agree with that – the exact remuneration alters when one or more of these factors changes e.g. a worker on a night shift can expect to be paid more for working anti-social hours, a worker performing a more highly skilled task can expect to earn more and so on. However, within most modern organisations the nature of “role” has to be taken into account. You might have the same overall “function” e.g. both lawyers but for the individuals in question the “role” and responsibilities thereof may differ vastly. There are increasingly issues around this “same-ness” in modern roles, are there really any roles that are exactly comparable? In an organisation like ThoughtWorks where we have transient job titles and with a lack of public sector style concrete grades we are left to consider each individual separately. So how does an organisation decide what aspects of an individual’s performance and role are worth more – taking the world of IT consulting as an obvious example. What do we look for in potential ThoughtWorkers? What do we value? As a few examples I can say those people who are passionate about their jobs, those that commit to open source projects, maintain a blog and partake in the ongoing learning offered by more informal gatherings like our “Geek Nights” and “Ruby Tuesdays”. These are extra points that may add “value” to your employ by the company. However as I mention “value” doesn’t equate to “salary” as an exact transfer.

In the discussion of salary that I have with a potential new hire I always ask two questions. They are, “What is your current salary?” and “What would you like to earn?” The differentiation between these two sums allows me to gauge a candidate’s perception of their own value, in short their own marketability. This is an important consideration. It’s Marx that states that in working or allowing the “exploitation of their labour” an individual in a Capitalist state is in effect selling their labour to their employer. The “price” they accept to take a role is their salary. The scale of difference between the two numbers offered will also give a recruiter insight into their attitude towards the current employer and often their knowledge of the current market. I will be first to admit that anyone wishing for a £20,000 pay hike is going to have to demonstrate effectively what their reasoning is for wanting that large a differentiator, what are the factors for justifying it? For employers salary has a memory. The majority of standard reference requests will ask for a confirmation of a stated salary.

Salary transparency as a means of retention is again a limited argument. The assumption is that as an employee either the primary or ultimately the sole reason an employee stays with an employer is because of salary. We are all hopefully aware that this isn’t the case and that many employers offer a wealth of benefits and concessions to a work life balance that are not quantifiable in the simple measure of basic wage. Looking at those labour markets where salaries are substantially higher e.g. Investment Banking higher salaries are oftentimes referred to as “golden handcuffs” or “gilded cages” effectively these employers are having to buy the loyalty of their skilled staff in the face of the lack of other trade offs like work life balance or flexible working times. Is it the transparency of salaries that keeps employees in these locations happy and working or simply that the salaries are sufficiently inflated to keep them from asking (or giving a damn about the answer)?

ThoughtWorks is a developer of bespoke software solutions and a keep proponent of the Agile and XP methodologies. In designing software we ask our clients to use a standard construction in describing the purpose of a feature for their new software, referred to as a “story”. “As an X, I want to…, So that…” we use this to hold up requests for scrutiny, to evaluate them in isolation removed from the often emotive responses end users may have. So, as an employee of X company, I want to know all my co-workers salaries so that… then I think it all falls down, if there’s no action are you in a better or worse position knowing than not knowing? How does knowing this information inform your actions or your interactions with other employees? It’s my feeling that most people want to know the salary information of their peers to use as a jumping off point into their own discussions around their personal salary. However, the information of peer salary in this discussion is largely irrelevant – instead we should be thinking of the wider labour market in our current geography. To gain salary information as an individual you don’t have to piece together pages from the finance teams shredder or lie in wait in the dumpsters near the office, salary information is freely available on the job boards and advertising available to all. Recently there has been a glut of websites launched aiming to catalogue salary information for casual viewers. Glassdoor.com is a recent newcomer to this space and provides, amongst other things, salary information for staff of major corporations, and yes ThoughtWorks has a presence, although I can confirm that the pay scales are incorrect at present. Provided more people join and enter their information truthfully this scale will normalise over time.

In all of these discussions the culture of transparency is held as the ultimate goal of an organisation and I’d wonder if this is the case. In my opinion it is a culture of trust we should strive for. Employees who feel they are paid fairly, because they have effectively sold the “exploitation of their labour” with full knowledge of the market in which that labour is sold will be better able to realise their own position and not be concerned with how Bob was able to afford that new Corvette, but instead trust they are given a fair salary based on their own personal circumstance and that the company they work for will aid them in their strive to grow and develop as an individual – salary, the nuts and bolts measure of their value, will become secondary.


* For those interested parties the Gerbil in question was named "Nibbles".


Also for those people disappointed not to find a tribute to McKinley Morganfield a.k.a. "Muddy Waters" of Blues fame I attach a picture by way of apology. Go listen to him here.

The Malleus Maleficarum and the Danger of the Perpetual Interview

The Malleus Maleficarum (Latin for “The Hammer of Witches”, or “Hexenhammer” in German) is one of the most famous medieval treatises on witches. It was written in 1486 by Heinrich Kramer and Jacob Sprenger, and was first published in Germany in 1487. Its main purpose was to challenge all arguments against the existence of witchcraft and to instruct magistrates on how to identify, interrogate and convict witches. The Catholic Church banned the book in 1490, placing it on the Index Librorum Prohibitorum. Despite this, the Malleus Maleficarum became the de-facto handbook for witch-hunters and Inquisitors throughout Late Medieval Europe. Between the years 1487 and 1520, it was published thirteen times, and between 1574 to 1669 it was again published sixteen times. The papal bull and endorsements which appear at the beginning of the book contributed to its popularity by giving the illusion that it had been granted approval by Pope Innocent VIII.

So, what's all this got to do with the world of recruitment? Am I about to advocate the burning of unsuccessful candidates? No. Talking recently to a friend who is an in-house recruiter at a global software company she was saddened by a practise that was seemingly commonplace. After the recruitment process was completed, the tests all squared away, file lovingly placed in labyrinthine databases - her new recruits we're being force to run an equally nerve racking second "interview" in their daily work. In effect they were having to prove themselves to their coworkers despite having already run the gamut of a lengthy recruitment process.

This is an example of yet another recruiting anti-pattern - The Witch Hunt. In short this is the practise of the re-examination of hires by some or all of the incumbent members of staff, whereupon judgements on suitability, technical ability and overall "fit" will be gleaned from limited interactions (water cooler conversations) and these confirmations distributed to the larger workforce through informal interactions. The outcome of this process is the alienation and damage to the reputation, be it technical or social of the individual involved. The Malleus describes this process as "initiated either at the instance of an accuser, or of an informer actuated by zeal, or by reason of a general outcry and rumour" - suddenly 1486 seems more relevant!

Obviously, I am not accusing a workforce of whipping up the same fervour for brutality that we read of in the middle ages, but the pattern is largely the same and the effects less dangerous but no less debilitating to the victims.

Any organisation that has a mantra of hiring "the best", "the top 1 percent" or "from the best universities" is fostering a culture of entitlement and arrogance in it's staff. By the simple fact of going to work each morning is confirmation of their position as "best". This can have a catastrophic effect on an organisations ability to hire and retain staff. The formation of a dominant,oppressive culture rather than that of collaborative or inclusive can only lead to the atrophication of ideas and kills innovation. New staff hired in these organisations will only ever be "cookie cutter" representations of those persons already present - cultural stagnation awaits.

What then, can recruiters do to stimulate a change in these practises? There are some easy steps that one can make during the process to try and avoid the later Witch Hunt!

1. Make an advocate for your candidate - When interviewing, particularly in the case of technical staff, use a widely respected member of staff. Make this one of your "gurus" or architects and the wider body of technical staff will instead make value assumptions based on their perception of the interviewer, in short "Bob interviewed him? Oh he must be great then". Of course this does mean that you'll need to ensure that your candidate is good enough to pass that evaluation.

2. Become an advocate for a new hire yourself - During the recruitment process highlight the achievements and status of the new hire. Bring attention to those points that made them an attractive candidate in the first place - publicise their blog, published articles or accomplishments in the Open Source community. This is also a great "double check" on a candidate - if you can't think of anything "saleable" about the candidate are they right? Why are you hiring them?

3. Look closely at your onboarding process. Look for elements of over exposure, take care with a new employee that others are aware of their level and set expectations with these parties. Set meeting points and get regular feedback on performance. If a candidate passes the interview process but is seeming to fail in the day to day work look closer at the tasks assigned are any outside of those first detailed in the recruitment process or envisaged in the role description.

4. Assign a sponsor or buddy for your new hire. ThoughtWorks has an effective sponsor programme in operation currently. Sponsees are expected to meet up at least once a month to discuss how things are going and other concerns or problems they may have. These meetings are informal and are often over a lunch or after hours adding to the social aspect.

The hatred and misogyny espoused by the Malleus would eventually come to an end in Europe. In England in 1684, Scotland in 1722 and not until 1782 for the Swiss. So the fervour for alienation and accusation has long been dead... but how much of it lies dormant in your corporate culture? How welcome are your new employees? Is there any Matthew Hopkins spirit in the dark corners of your office?

A job for life...and why it's good to keep in touch with your ex...

I'm always pleased to read new posts on Johanna Rothman's blog Hiring Technical People, as I feel there is a lot of noise around recruitment hers is a voice of sanity. Her latest entry on Initiative vs. Entrepreneurship seems to match perfectly with my experiences in my current role. In short she advocates hiring those candidates who demonstrate an entrepreneurial streak - whilst they may be a flight risk (leaving to set up on their own) the ideas and skills they bring in their time spent as an employee are often invaluable. Whilst this stance can often be a lightning strike to traditional thinking of a job for life in truth we now live in time that a "long term" employee is one that has been in the same job for three years! These are now our "old hands" this trend towards a patchwork CV increases in the technical sector and is further exacerbated by the peaks and troughs of an industry effected by technical discoveries as much as it is by financial market flux.

It's a fine line between demonstrating high levels of initiative and entrepreneurialism. It can be a particularly fearful one for an employer who feels the investment thay make in sourcing and courting a "high flyer" should be rewarded with at least x-years of service. I've harped on about the "Values" ThoughtWorks holds dear before but it took Johanna's post to make me see the thinking behind our - "Entrepreneurialism - Imagine and Pursue". Actively encouraging this spirit within our staff can do only good, and has led to some truly innovative tools and products being created. Whilst it maybe true that some of these people have left to go on to pursue their own interests it's certain that as an organisation as a whole we have certainly benefited from having those people as ThoughtWorkers. In taking those initial risks we have an alumni network that has aided sales and continues to promote ThoughtWorks as a standard of technical excellence at a global level - as evidence it was just yesterday I received not one but two referrals from one of our ex-employees. Sometimes it pays to stay in touch with your ex :)

Excuses, excuses....

Firstly apologies for not having posted for quite some time. For a while there it looked as though this blog would veer into the same territory as my slack attempts to keep a diary in my teenage years. This time however I have an excuse :) I have now returned from a stint of recruiting in Calgary, Canada and I'm back in London. I've used the intervening time to find a new apartment, replete with all mod cons. Sexy black kitchen - check, underfloor heating - check, slightly dodgy area - er....check, unfortunately.

Looking for rental property seems to be as much about looking for your dream house as it is about making concessions on that dream. Finding a happy medium between the two seems about right.

All of this laboured decision making had me likening finding a house to finding a perfect employee. How much of an interview process is blurring the lines of that ideal candidate to match the person sat nervously in front of you? I'm lucky that I don't have to fill a checklist of "must have's" and "desired's" in order to find the next ThoughtWorker. The ideal, and "what good looks like" to us is different on a case by case basis. We acknowledge that people may have stronger skills in some areas and require coaching to grow in others - just like there's no "perfect" house there are no perfect candidates.

Firing for Values?

As a subscriber to "Diversity Inc" my interest is always piqued when they get round to the core discussion of "values". This month's issue has a really interesting comment in their "Legal Section" simply they pose the question "Can you fire employees with different values?".

Weldon Latham a discrimination law attorney suggests that companies should exercise caution in these cases. He uses the example of those companies that operated in South Africa during apartheid, he goes on to cite examples of those companies who did not permit the external prevailing rules of apartheid to operate within the rules of their controllable corporate environment. Weldon gives a cautionary note however that a corporation cannot exist entirely removed from the country in which it operates. This is a great point, recently I've been reading about the rights of women workers in Iran - legally they are only allowed 1 term of maternity leave, if they become pregnant again they are forced to resign. In a similar vein, when women are ill, the social security office pays them 66% of their daily wage while men are paid 75%. In the face of national, institutionalised discrimination surely a corporation has a hard road to follow - they can fight the prevailing hegemony of the country in which they operate or chose not to operate in that region at all.

These are broad sweeping issues, polarising to those outside of the countries in question. The question “Hands up who wants to work for a racist company?” is pretty easy to answer, but then what “values” are we willing to negotiate on? As a consultancy should the values-led organisation be wary of which clients they are willing to engage with? Should an organisation ask expect an individual employee to put aside their personal values, attitudes and beliefs for the company’s profit margin?

At ThoughtWorks we do have stated values. They exist as in many other organisations as a web page, in some people’s email signatures and as handy “non-discrimination” notices at the bottom of recruiting ads… how then do we ensure that they amount to more than this? Too often “values” are sloganeering in the extreme, more about marketing position and candidate attraction as hollow as a sweeping “we recruit the best”. How can an organisation ensure that it’s stated values do not loose meaning overtime? In ThoughtWorks we have an answer. The values we publish are the subject of a constant conversation around their use, meaning and also as a set of checks and balances to guide decision making. There are often questioning voices as to the “values alignment” of a particular project and also occasionally of particular individuals, certainly it’s a feature of our recruitment processes, and figures as part of the “Cultural Fit” interview.

There are those people who would take a contract in Iraq at the height of the conflict as it came with a massive salary, “danger money” if you will! There are those people who would only ever consider working for a not-for-profit organisation and even then some are deemed “too corporate” or “only about the money”. I don’t think ThoughtWorkers exist at either of these extremes nor as a body of people are they stuck in a particular mindset – instead happy to measure the flow of information against their own checks and balances – filtering through their own personal values. It is this discussion around our values that gives them their strength – they cease to be meaningless corporate lip-service and become a living, breathing part of life at ThoughtWorks, we don’t expect people to recite them by rote but chances are they are already living them.

Why you should make friends with Recruiters.

Johanna Rothman over at Hiring Technical People has recently blogged a colleague's comments about the benefits of befriending those of the Recruiting persuasion. Although being aimed more at those recruiters working in Agencies I'm not 100% sure I agree with them all.

1. Some of the best jobs / candidates are rarely advertised

This is largely true. When I used to work in an agency often we didn't advertise because we were already calling a contact we knew was right for that particular role. When a requirement arrived from a candidate it was immediately followed up with a call to discuss the finer points and acknowledge receipt, then with the call finished a "top 3" candidates landed in the client's inbox. These were people with whom I had an existing relationship and the only way you can get into this "first pass"...befriend a recruiter.

2. If you refer people to your friend the recruiter, there is the possibility of a finders fee

For some agencies this is true, I wouldn't hold your breath! The best way to supplement your income in dealing with a recruiter is to let them find you a better paid role. It's a little mercenary to trade on your friends. That said, referral networks are big business, look at commercial ventures like LinkedIn, now a billion dollar company. These networks are not closed shops to recruiters and if you have any form of online presence you should expect to be contacted.

3. They can keep you aware of trends in the local market

Absolutely, if you want to know about hiring trends, downturns and new projects launching it's the Recruiters who will have the inside track. Whether it's official or not, one of the first questions a recruiter will ask a speculative candidate is "Why are you thinking of leaving?". Ask that question to 100 people, a week and eventually you're going to build up a pretty good picture of the business landscape.

4. You might be able to get a free lunch every so often.

I'd hope this is a joke, and if it isn't candidates need to be aware that the impression they give to Recruiters will speak volumes about the professionalism the recruiter believes they will display to their clients. Chances are that to an agency recruiter a client relationship is worth more than a candidate relationship.

I'd add one major exception to the list, make friends with a recruiter you trust. It's all too easy to fall foul of an inexperienced "Recruitment Consultant" so it's important that your career aspirations are in the hands of someone you trust. Use agencies wisely and if there's a company that you know you'd like to work for contact them directly. Send a speculative CV if necessary and follow up with a personal touch of a call or email - you can further gauge the reality of that company based on the type of response you get. If you think you we're treated shoddily in the hiring process what makes you think things will be different on the other side? Recruiters are the reflection of the internal culture of any company, it's their job to find out what's best about their employer and project it further - a recruiter with nothing to be passionate about may well be working for an organisation that there is nothing to get passionate about.

From "Social Experiment" to Memetic "Big-Bang".

ThoughtWorks says it's different. It's my role to communicate this "difference" in very real terms to candidates who apply to join us. As recruiters it's something we do everyday, what differentiates us? How are we different? What differences are more attractive that others?

It is the communication of difference that causes a problem and if a skilled recruiter can use the cultural differentiators that an organisation holds to be true about itself then these can be used to marry up to a candidate's motivations for joining the organisation. e.g. at a basic level, their current company doesn't offer them opportunities to travel - ThoughtWorks has many of it's consultants working outside of their home offices and aids them in relocating for a short term, the life of a project or even emigrating for good. Obviously not all aspects are that binary, it can't always be "current dissatisfaction + "different" cultural aspect = reason for joining". If it were always the case then an organisation would have to be all things to all people all of the time, no company is a nirvana so there will always be pros and cons to joining an organisation. All this got me thinking about the difference of ThoughtWorks comparatively to other organisations and how I could illustrate this to candidates.

ThoughtWorks has already done a lot of thinking about how it wanted to be different from the day it was founded and still does. Roy's Social Experiment offers a model for a company based on humanistic or anthropological lines concerned with the human behaviour, belief and value systems, sociological and cultural norms, that matched the type of company the founder wished to work in. This is obviously already a marked difference from the established organisational model which owes more to engineering showing an organisation as human constructs to be planned and controlled by rational, formal, structures and procedures. Though I feel the first model still holds true, ThoughtWorks is now a much larger place, over 1000 "ThoughtWorkers" across multiple continents in a myriad of countries. In growing globally "cultural norms" are blurred and belief and value systems are disparate and sometimes even conflicting. How then does a "social experiment" of an organisation maintain "cultural norms". One answer is to regionalise and accept geographical/political boundaries as cultural way points - the other alternative is to create a culture of your own.

The third model I propose in communicating the "difference" of ThoughtWork's organisational structure is organic evolution by natural selection. In the case of ThoughtWorks it is an evolution punctuated by the imposition of selected "organic replicators" - the employees are selected through an interview process. While organic evolution is blind or without conscious design (sorry to the Creationists) organisational evolution is a conscious program of selected memetic replication, shaped by internal forces managers, recruiters etc as well as external forces market pressures, competitors and technological advancement.

Biological metaphors have long been applied to the world of business e.g. "Survival of the Fittest" to illustrate competition, but more recently new thinking around "Chaos" and self organising systems offer a better model for an organisation than the "engineering" approach. Allowing us to realise that organisations like economies "evolve" as self organising systems. If we take this "genetic" approach I think it's natural to take Roy's Social Experiment as the memetic Big-Bang that went on to spark the evolution into the organisation as it exists today

ThoughtWorks as an organisation has, from Roy's original primordial soup, developed surprisingly common sets of dominant motivators. People who don't share them don't join, or don't get on, or are the first to leave on discovering a culture than can be alien to the "norms" that exist outside. In creating and managing a "learning organisation" we can escape the genetic dominance of the simplistic "survival of the fittest" and move towards an assumption that companies are creatures of their memes in the same way that organisms are creatures of their genes, that is vehicles which the memes or the genes, the replicators, create in order to perpetuate themselves.

For me this is what ThoughtWorks has become, a memetic snowball rolling down a hill, growing as those that share the similar ideals and values join and growing larger with each new hire. The fact that this evolution is constant can account for the "bursts" seen in nature exploiting environmental factors, this has an obvious parallel with the exploitation of new technological advances and the fostering and cultivation of those advances that will give the organisation an edge. New memes can propagate freely and become "viral" within the organisation, undergoing a micro-evolution of their own as they pass among individual ThoughtWorkers.

Working outside of rigid and constraining forms of a "normal" organisation allows for freedom of communication, a flat structure free from hierarchical constructs and allows the collaboration that fosters innovative thinking to thrive. That's not to say that ThoughtWorks is a panacea for career ills, it is a company full of individuals and with that come individual opinions, ideas and all the flaws and foibles that make us human.

Thinking about the company I work for in this way enables me to better illustrate how "different" we are from other workplaces and allows me to assimilate all the tangents that a candidate might have questions about. Motivations for joining a company are diverse and it's rare that I talk to two people who share exactly the same motivators, however the ever changing and constantly evolving elements that go to make up ThoughtWorks as a whole enable me to offer an area of interest to most who apply.

Vive La Différence!