The salary history question has become quite controversial in recent months, and some cities and states have created laws around it. It used to be an expected question during the interview process, but there is debate over whether the question is a fair one and could cause pay inequality to prevail as women progress through their careers.
How prevalent is this interview question and what affect does it have on employees? PayScale recently conducted a study to find out just that. They surveyed over 15,000 job seekers and found that only 43% were asked to provide their previous pay. Specifically 33% were asked and answered, 10% were asked but declined to answer, 6% volunteered their previous salary, and 51% were not asked and did not disclose previous pay information. Interestingly, pay was highest for those who refused to disclose their pay.
Job level and income bracket tend to influence whether or not the question is asked. The higher up the career ladder you are, the more likely you’ll be asked. Individual contributors were asked 41% of the time, managers/supervisors 45%, directors 52%, and VPs and Executives 54%. Those seeking higher income level positions are the most likely to be asked about their salary history; however, those in the highest income bracket tend to be the least likely to disclose that information.
The study showed that there was no statistical difference between men and women regarding the likelihood of them disclosing or withholding salary history. However, women who choose not to disclose prior salary earn 1.8% less than females who choose to disclose. On the flip side, if a man declines to disclose he is likely to make 1.2% more than his male counterpart who discloses. A strange phenomenon.
So how should the topic of pay be discussed during the interview or offer process without asking about prior salary history? Let the market guide your offers. Companies that ask about salary history are often perceived by prospective employees as the type of company looking for a bargain employee that they can haggle down pay with. The position should pay what the market currently dictates for that position and the amount of experience the candidate brings. The prospective employee is likely armed with this data and employers should be too.
Often salary is brought up early in the process in order to be sure the employer can afford the prospect. An appropriate alternative to the salary history question to ask is, “What are your salary expectations?” Keep in mind that this could change slightly as the employee learns more details about what the job entails, but you’ll at least know if the salary level set for the position is within their expectations or if their expectations are unrealistic and do not match the market value.
Employers can discuss pay with potential employees in an open conversation without having to ask about salary history. Before the interviewing process begins, be sure you’ve done your homework and know your organizations goals for the position, the market value of the position, and how you will broach the topic of pay with candidates.