Pay Secrecy

OS352 HRMFisherApril 6, 2005

Agenda

Review case analysis in groups Discuss other examples

Small group discussion

Divide into groups based on your recommendation Sim Bakke Kay Tulgan Your own

What are the strengths and weaknesses of that recommendation? Why did you choose it over the others?

Why pay secrecy?

Why do companies often want to have pay secrecy?

Are there any downsides to pay secrecy for management?

Legal Issues and Pay Secrecy

National Labor Relations Board prohibits policies that forbid discussions of pay

Companies have found more support for policies that prohibit revealing the entire pay structure Confidentiality (trade secret argument) Similar to a product formula or

marketing strategy

Examples

Service Merchandise (retailer) Woman was fired in 1980’s for

discussing wages Was rehired, company had to rescind

policy Nursing home in Ohio

Woman was fired for helping co-workers discuss inequity problems with managers

Was rehired and paid back wages

Whole Foods

Philosophy of employee empowerment, “no secrets” management

Team members participate in hiring decisions

Profit-sharing rewards distributed monthly Salaries for all employees – including

executives – published in each store Strong financial performance over last

five years

Source: Fishman, C. (2004 July). The Anarchist’s Cookbook. Fast Company, 70-78.

For next class

Employee benefits Read chapter 13 Bring benefits information from

scavenger hunt. Will distribute final essay questions. SAP exercise 3 due on Friday at

3:00.