Microsoft recently announced that it would start disclosing salary ranges in the US in January 2023.
Some states have already implemented such a policy where large employers are required to provide transparency over their pay ranges, normalizing this trend.
Prior to these regulations and policies, discussion over salaries was viewed as controversial. However, Microsoft’s decision may set them apart in the war for talent, as well as establish precedent for other companies in the tech industry.
By doing so, Microsoft will directly provide a reference point for pay within the tech industry. This could lead other companies to increase their wages or benefits in order to compete.
So how should leaders proceed?
Transparency from all aspects of business operations — from pay to policy — has become increasingly valuable for employees. Workers want to know that their employer has their best interest in mind, and without it, are more than willing to seek a position that does.
One way to eliminate this risk is to highlight what may set a company apart from the likes of Microsoft. Does it have more options for remote work? Is geography a factor in hiring? Do employees get more paid time off?
Putting an emphasis on the factors that Microsoft does not have could help employees prioritize other workplace benefits aside from pay.
Whether a job is offering more or less than Microsoft’s salary, it is vital for leaders to have a response prepared for either scenario. But most importantly, it might be worth following suit and adopting a salary transparency policy.