Can an employer disclose your salary to other employees?
Your employer has the right to disclose your salary to other employees of the company. There are no lawful prohibitions against this.
I would find it odd and unprofessional if some sort of discussion took place outside of this frame.
These situations can get quite sticky so let's explore this office topic further.
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Can an employer disclose your salary without your permission?
Yes, an employer can disclose your salary without your permission to any relevant agencies that have the authority to obtain such information. Examples of such agencies that could ask your employer for salary information would be state tax and the IRS, or any other tax-related agency local to your country.
No door is closed when it comes to collecting taxes.
Bear in mind that the amount of money you earn is not some sort of top-secret information.
Also, your employer can disclose your salary without your permission to relevant staff members such as your team leads, department managers, or HR representatives.
Besides, this is a good thing! Perhaps they are being like: “Hey, Fred does good work! How much money does Fred make? Let’s take a look and see what we can do. Maybe we can give him more money!”
If you are being sued (to pay child support, for example), then your employer will be obligated to disclose your salary after a court order.
Essentially, a court order would be the ultimate UNO card. It just wins the game immediately and nothing can be done about it. Your employer will have no other choice but to comply.
However, employers would usually not disclose salary information to creditors or other third parties.
Essentially, if one day some shady person pops up at your office and demands to speak to your boss about how much money you make. Well, that would be quite weird, wouldn’t it?
I imagine that would be quite embarrassing. And there would be all sorts of questions that will pop up in the heads of your boss and colleagues.
Like, is this somebody you owe money? Or, is this a family member with a gambling addiction?
Regardless, I am sure that your boss would politely ask the person to leave. Or they would call security.
Is it illegal to discuss wages at work with your colleagues?
In the USA, it is not illegal to discuss wages at work with your colleagues. According to the National Labor Relations Act, employees are allowed to discuss salary and working conditions amongst themselves.
Besides, why would it be? As we already established, salary is not some sort of special magical information that needs to be kept secret.
Is salary confidential by law? No. Of course not! And if you have come to think so, it is probably because you’ve been to plenty of workplaces where company policy discourages or strictly forbids the discussion of compensation between workers.
This should generally apply to most countries from around the world but I wouldn't be surprised if there are places where things were different. The world has plenty of catching up to do with modern human rights, and I don’t mean just salary talk.
To this day, there are many places with terrible labor laws. And terrible labor conditions. Discouraging or downright forbidding salary talk is just another tool used to silence people and control them.
Discussions of salary and working conditions should be allowed by law everywhere so that workers can organize and ask for better working conditions. Otherwise, big business wins. Even harder.
However, I personally think that this doesn't mean that a person can and should be able to freely access the salary information of their colleagues.
I know I said that it is not some kind of magical secret information but I think that people should be allowed the decency to choose whether or not to share this kind of information.
A worker should be able to withhold their salary details from their colleagues if they wish to.
Is it illegal to tell employees not to discuss pay?
I hate to say it but it all depends on where you are and what your local laws say. It’s all very convoluted and complicated. However, I find that the general trend is to have more and more pay transparency, especially in the USA.
For example, in 2015 the California Equal Pay Act was signed. Essentially, it says that employers are prohibited from telling their workers not to discuss their pay.
And then there is the National Labor Relations Act which protects workers’ rights, I believe on a national level.
Even if a person has signed a non-disclosure agreement, they are still legally allowed to discuss pay with other workers, no matter what state they are in.
Also, a company can’t fire a worker legally for discussing pay, be it at work or on social media.
So if somebody threatens you, you can wave these fancy laws and legislations in their face and shout at them: “I KNOW MY RIGHTS! I KNOW MY RIGHTS!”. I am sure this will shut them up. And possibly make them scared of you.
However, always refer to your local laws and regulations when it comes to these matters. And, if possible, consult with a legal specialist before taking any action.
Salary transparency in the workplace
Today, salary transparency, or pay transparency, is more than just a term thrown out there.
And while there is stigma around salary discussion everywhere you go, many companies from around the world have adopted salary transparency into their culture, regardless of what local laws and regulations say.
According to the 2021 Compensation and Culture Report by Beqom – a compensation software company – of 1000 people asked, 51% said that they would prefer to work for a company with more pay transparency.
Personally, I think this preference is more about the knowledge that you don’t work for an evil controlling company that uses all possible means to exploit its workers such as giving them extra responsibilities without giving them a raise.
From what I was able to find out, currently, there is no comprehensive study and analysis on whether or not pay transparency is actually beneficial for workers and companies. The science is just not in yet.
Of course, the common concern with salary transparency is that some people make more than others. And this leads to jealousy and morale gets low.
I can see that. Finding out that your colleague who also works 8 hours a day in the office makes a little or a lot more than you can be harsh. But I think that salary transparency is something more and more companies and organizations should embrace and make it a part of their culture.
Discussing salary has always been a bit of a taboo in the workplace, hasn’t it? At least in my experience, it has always been.
How come money is such a touchy subject when it comes to one's compensation? I guess people who feel underpaid are ashamed of how much they earn. And those who earn a lot might be worried about jealousy and their own safety.
From what I have found, statistics show that employers themselves discourage (or downright forbid) workers from discussing their salaries with other employees.
This is because morale can get low when somebody finds out that they are underpaid. And they might ask for a raise on the grounds that they do the same amount of work.
But how can we give workers the ability to earn more money and make a better living for themselves without giving them the opportunity to understand how their salary is formed?
- An employer can disclose your salary without your permission to agencies that have the authority to obtain such information. They can also disclose it to specific staff members.
- An employer is obliged to comply if a court order is issued that demands your salary numbers.
- An employer would generally not disclose your salary information to random third parties that have no business knowing it.
- In the USA, it is not illegal to discuss wages at work with your colleagues.
- In some states and countries, it Is it illegal to tell employees not to discuss pay.
- More and more companies and organizations are embracing salary transparency in the workplace as part of their culture.