Not disclosing past salary hurts women candidates, study finds

Dive Brief:

A new PayScale study found that women candidates who declined to discuss their past pay history were paid 1.8% less than women who did, reports Harvard Business Review (HBR) in an executive summary. However, men candidates who declined to discuss their past earnings were paid 1.2% higher than men who did. PayScale surveyed 15,413 job seekers between April and June for the study.
The summary acknowledges the double standard in pay discussions for female versus male candidates, but concludes that the survey's findings don't support the ban on discussing pay history to close the gender-based pay gap.
To avoid pay disparities between women and men, the summary recommends that employers stop asking candidates for their pay histories; base pay on the position, not the person; and, instead of asking about pay history to determine whether their budgets can afford a candidate, ask what the candidate's salary expectation is.

Dive Insight:

HR has a central role in assuring that salaries between women and men — barring differences in experience, education and other qualifying factors — are comparable. HR leaders can access reports on market-rate pay based on job titles, regions and other variables, allowing employers to see if their own salaries are competitive. HR should also conduct internal audits via data to uncover any pay discrepancies based on gender or race.

Deciding not to base pay on salary history is an important first step in leveling the playing field and creating an equitable workplace. But the fact that men candidates who don't discuss their salary histories are paid more than men who do suggests that women who proactively negotiate pay are viewed less favorably than men who make the same decisions. Women often bear the brunt of such views, even when negotiating increasingly favors benefits such as flexibility.

Part of the problem may lie in making employees negotiate their own raises, which is fraught territory. At least one expert that spoke with HR Dive noted that her company explicitly did not make employees do that and instead based all pay levels and raises on specific pay bands that were explicit and well-publicized within the company. Employees would know what they had to do to achieve the next level of pay without having to dedicate energy to a stressful conversation.