If she is doing the same work as me, why is she making $5k more than me?
The problem here is unfair payment; by not disclosing salaries, the problem is hidden, but it doesn't go away.
The problem here is unfair payment; by not disclosing salaries, the problem is hidden, but it doesn't go away.
That covers the case when talking about salary is prohibited by a company policy.
Why people don't tell their salaries? Well, I do tell to (some of) my co-workers. None ever said to me: Wow, you make a lot of money! - Instead, they say: Wow, I could be making more. - So they'll start looking for other jobs (not counting lots of other factors beside paycheck. Lots)
Anyway, top reasons why people don't tell how much they earn:
1) We deny a chance of making others sad;
2) We fear our bosses will discover that we talked about our salaries, thus a) being the reason why an employee quit; b) being the reason why an employee asked for a raise (increasing the company expenses);
3) Fear of security; Once your salary is "out there", the watercooler talk might be: Wow, do you know how much inerte makes? And you don't know who'll end with this information.
4) Compensation isn't a factor when there's blame to assign: Wow, inerte makes lots of money, how come he did this stupid thing? - As if someone less expensive, with a similar set of responsibilities, is allowed to make more errors.
And you know what? Some of these reasons are true. I know how much 6/7 members of my team earn per month, and I know I am being underpaid. In 3-5 months I am probably asking for a raise. If they deny, I will at least dip my feet into the job market, and see if I can also get 33% or 90% more.
Yes, someone earns 90% more than me for something that I know how to do it. He has more experience on some other stuff, but he's also friends with the boss. His salary is so above the market that I suspect someone is getting something out of this (aka, corruption?).
I tell how much I earn because I do want others to look, if they want to, for better paying salaries or to negotiate their current ones.
From boss point of view: me and her are doing same work, payment is equal.
My point of view: I always deliver my work within deadlines, she is late sometimes, I should get $5K more
Her point of view: I stay extra half an hour most days, he leaves at 5PM sharp, I should get $5K more
Solution? Well, not disclosing salaries more or less works so far.
Here is a non-cynical explanation (not that I believe that the cynical view that it is for salary suppression is necessarily wrong)
I realise a lot of people here work in startups or other kind of hothoused environments. The reality elsewhere is that a company needs people with all kinds of ability - they need the reliable but unimaginative person (let's call them the plodder programmer) that will come in and tie up all the lose ends that the hero programmer left behind before they got distracted by the latest shiny. The hard truth is the hero programmer will get paid much much more than the plodder, for obvious reasons. If the hero goes around telling everybody what they get, that is demoralising to the plodders - it just rubs their face into it, because they will never be the hero. But they can offer a company years of valuable service and dedicated work. As a geek herder, just because my HPs are worth more, it doesn't mean I value my plodders less.
So I would prefer not to discuss renumeration, though in my world that would be done out of politeness rather than contractually enforced.
You should read what Joel Spolsky has to say about the issue... There are more variables int this than you'd think. He gives a good explaination of why this is a problem in his article on inc magazine:
http://www.inc.com/magazine/20090401/how-hard-could-it-be-em...
market value for the kind of work you do + whether your employer pays above or below that + your individual skill level and experience + timing of entering the company + your negotiating ability
All are highly variable values for any individual.