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Comment by alexpotato | Hacker News Reader

Many years ago, back when companies could ask for your previous compensation [0], a hiring manager once said to me "don't ever lie about your past compensation".

I wasn't sure how they could figure this out at the time until someone later pointed out that many corporations do a credit history check on you as part of the background check. This gives them access to past compensation.

The information asymmetry here is, as with much of hiring, pretty bonkers when they had both the current and past comp history during negotiations when you have just yours. You might also have the comp history of your friends too (if you share) but that's still tiny compared to the corporations.

0 - this was in NYC where it's now no longer allowed.

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An old neighbor of mine was a headhunter. He once told me that some companies had a trick to get around the law. Upon getting hired, you'd sign a document saying that you'd agree to all policies in the employee handbook. Pretty standard stuff. One of the company policies was that you needed to prove any previous salary you stated in the negotiation. If it was too far off, they'd just terminate you. The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you.

> The trick is that they didn't ask at all during the hiring process; you're already hired and onboarded and then HR puts a meeting on your calendar to explain the policy to you.

Yeah, "all bets are off" once you are a FTE.

Isn’t that too late to negotiate compensation? I had figured most of the value is knowing how to properly lowball candidates

It sounds like negotiation would still be done however it normally would before things got to this point.

It sounds made up. Who would go through the negotiating phase, hire the person go through all paperwork only to then gotcha them and fire them if they lied about their past salary? I've never seen an org that actually played games like that.

Dunno, kind of sounds like hiring and then negotiating compensation.

Christ, that sounds like a colossal waste of time for everyone

I call BS. Why would they hire you at an agreed to price, go through the cost & effort and then try and "get you"? Your old neighbour was either in bed with his hiring clients or not very good at his job.

He recruited for wall street trading firms; based on the finance types I've met over the years in NYC I would 100% believe some did this just because they hated losing. He was just making the point that you should never lie about your salary history, because he can help you if you didn't want to give it but he couldn't help you if you BSed everyone and got caught.

It’s definitely made-up. I worked for a Wall Street trading firm in the securities division for 8 years. People lie about comp as a matter of course. Secondly, many/most senior-ish jobs in those firms come with a guaranteed bonus for the first year or couple of years. If they were to fire the person before that period elapsed they would have to pay out the bonus.

I know of many people who were fired the day their guarantee elapsed- I can’t think of a single person on a guarantee who was fired before then. To put this into context, we had a guy on a guarantee on our prop desk who came in for one week after he joined, put on a (massively winning) trade that got him enough to get his guarantee and then literally didn’t set foot in the office for the rest of the year[1] until the day he came in to collect his bonus and resign/be fired.

[1] And it’s not like he was working from home because people in trading were (for compliance reasons) not allowed to work from home unless there was an emergency like a terrorist incident where the trading floor was closed.

That seems like a great way to open your company up to a discrimination lawsuit (whether warranted or not). Not to mention the costs of hiring a new employee you only fire a month later - why bother?

Sounds like HR mythology.

"don't ever lie about your past compensation" — because they can't figure it out on their own and IF they do (at least in my jurisdiction), you've got a nice case on your hands to sue them for violating privacy laws.

The correct answer is: ALWAYS lie about your past compensation. It's the only way to get forward, one way or the other.

This is one of those strategies that may be "correct" in the sense that it works once or twice, but isn't a great long term strategy.

e.g. let's say you sue and then win: that's now in the public record (which any new hiring company can see).

Its the perfect case for why labor organizes.

Collectively battling this is good, but individually no one wants to because its personally high risk (legal costs, deter future employers hiring you) and low reward (some settlement that won't change your life).

Are you part of a union? How can we get the tech industry unionized?

A better strategy is to push the conversation in another direction:

- My current comp is X, but that's not what I am worth to you.

- I've done my research, and someone with my experience is worth Y. I expect at least Y.

You set your salary expectations with your opening bid instead of letting them make the opening bid. It's also contingent on you having done your research =)

I cannot dísclose muy current compensation due to an NDA: salaries are company propietary information.

I am unable to dísclose that information.

If you are a non-managerial employee, the NLRA explicitly prohibits your employer from restricting you from discussing your compensation.

And anyway, if you’re not in a state that has banned employers from asking for salary information, the recruiter always has the option of shit-canning your application for being non-responsive.

The correct answer is to answer the question you wanted them to ask, "I'm looking for $x"

No lie, skirt the irrelevant info

I'm skeptical. Credit checks don't give you an accurate picture of your compensation and it's not like they get your transactional banking history or tax documents (yet). Even with that it would be impossible to get an accurate compensation figure within 25%, so while I agree there's an informational imbalance if that's how you're negotiating you've already lost.

Eh, I don't have the link at the moment - it was posted some years ago on HN. In the US, your employer very likely reports your salary to a national agency. And other companies can access it.

You can go to the agency yourself, prove your identity, and see all your salary history.

Good lord!

I knew the USA has poor data protection law, though the very idea that companies can legally share such personal information is truly mind boggling.

Why on earth aren't people doing something about this?

The Work Number by Experian gives all past income information. I think many (most?) companies participate in it, so it's somewhat likely your current income is being reported.

This is accurate, except theworknumber is an equifax product. Experian and transunion have similar products however that share past comp data in exchange for a fee and/or current data sharing. Basically, "theworknumber" lets employers see what you made previously in exchange for the employer sharing what they pay all/most employees currently.

Large companies often share a lot of details too, such as yearly raises, bonuses, weekly rates, etc. Still, it is often inaccurate. For example, I have worked freelance extensively under my name (DBA) and llc and none of it is there.

You can pull your record if you want. If your employer uses workday, they almost certainly share every paystub with theworknumber.

You can freeze your data: https://employees.theworknumber.com/employee-data-freeze

HOWEVER, if you do so, many companies won't proceed with an offer until you unfreeze.

See also sibling comment, the Big Three offer free annual credit reports through https://www.annualcreditreport.com/index.action but I haven't seen work history included. I believe that they do collect & report on this information, but I have been unable to get them to share it with me.

The Big Three have many non-credit-report products, and no they will not share them with the reports' subjects (you and I).

I don’t recall ever seeing a salary in my credit report. Certainly when applying for credit cards you are asked but generally they have you include all sources of income including bonus, passive income, and alimony.

There are data sources for this info but I don’t think it’s technically a credit report.

Experian does collect and sell income data about people, in fact i think they pay companies directly for this information. This is helpful for salary negotiations. It’s not in a normal credit report though, true.

Loan applications. Credit cards. They all ask for your income. I always put 1,000,000. Never been denied a loan.

Mortgage loans and car loans in America also ask for your W-2 or proof of that said income. Can't prove it, they won't let you use your claimed income as basis for loan approvals.

I never had to supply a W-2 for a vehicle loan. Just my SSN. I almost always get unsecured loans too. They just dump money into your bank account and say "please buy a car with this" and you keep the title. For a mortgage you do have to validate your income. The work around is to just buy your house in cash, I guess (sigh). So I guess mortgage loans leave you open there, but those happen less frequently and may not be good map of income level on a shorter period.

Once in a while they want to see a bank statement or two showing actually paycheck deposits, but I only ever saw that on a mortgage. Once for the car loan they asked to see a balance or two via bank statement. So I showed them a bank account sitting around the $$ for the vehicle loan.

I tend to just avoid loans if at all possible now though.

> They just dump money into your bank account and say "please buy a car with this" and you keep the title.

where is this?

you don't have or keep the title until the bank sees you paid off the loan, in every instance i've seen.

An unsecured loan just a straight cash loan. In my experience the interest rates are usually a fair bit higher than a vehicle loan, and I would assume the maximum amount is generally quite a bit lower.

Ahhh, like if you were to put your new VW on your Visa card entirely.

That might work: you'd have bought the car, from the point of view of VW and your DMV, so the DMV sends you the title, not Visa.

In my experience it really depends. You are still contractually and legally obligated to purchase a vehicle in many of these setups, they just don't follow up or enforce it directly in most cases. Loan rates are nothing like unsecured personal loan rates. Probably higher than best auto loan rates. With rates being what they are it may not make as much sense to use an unsecured loan at this point, but when rates are low the cost was negligible and the convenience worth it.

In Maryland I received my car's title, but it just shows the lien holder's information on it. I've never bought a car in any other state so my information is limited.

Is this different from what you mean?

i'm pretty sure that in Arizona, and i think in California, they DMV sends the title updated to show the original holder (like BMW Financial Services, Subaru Financial Services, or whatever) has been payed completely, and the person is then shown as the title holder.

I've even had to prove my salary when applying for apartments. No loan involved. The first time that happened I didn't have a w-2 yet, so they called my employer to check.

Right - there are plenty of data sources here but it's not a credit report.

If I remember correctly, ADP and the other big payroll processors sell your income data, as do many of the finance apps that get access to your bank account data. They also have your rent and mortgage payments typically. It's not always a line item in your official credit report, but the data leaks (and is sold) everywhere. Probably the more correct phrasing would be "in your financial target data profile as sold by [credit agencies, et al]"?

Equifax’s The Work Number buys salary data from employers and they use it for income verification when applying for loans and rentals. You’d be surprised how much data is out there; and it was all sold by entities you ‘trust’. One example being the DMV

If you lease a car these days you will be swamped with offers from banks and lease-end "providers" as your end date approaches. I got really mad with the dealer until they told me it was the DMV that was selling that information.

Regarding The Work Number: you have the right to see your own report and it's worthwhile to do so. And it's scary. A lot of the information is usually incomplete and/or full of holes. I can't believe anyone would base a decision on this data.

as an example, i have received usmail junkmail addressed to my address, but with the name of my first cousin's husband's name, which makes no sense unless some incompetent data brokers are just merging their datasets in all sorts of random ways and seeing what sticks.

i dream of phone calls costing the entity placing the call some significant-at-scale price, perhaps a dime, and bulk rate physical junkmail needing full postage.

The information asymmetry here is ... pretty bonkers

This is why you shouldn't trust anyone who sells you on the idea that the ability to negotiate your own deals against large corporations is a feature and not a bug.

The information asymmetry, plus the difference in legal fire power & wherewithal to withstand a drawn out negotiation, will always put you at a disadvantage.

The information asymmetry is sort of wild to me. I can't really figure out an angle why this isn't bad for the same reasons insider trader is bad. I'm even okay with them having the info, I just think companies should be required to publish everyone's salaries. Redacting names is fine, but I should be able to look up the team I would join and see titles and salaries for everyone on the team.

So, lie about RSU and Bonus?

It seems like base salary would be easy to track, but other benefits would be much harder.

Lying about my compensation always worked so far

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