Quick Question

I’ve been reading your posts about employers that won’t continue an interview if you won’t disclose your salary. (Goodbye to low-ball salary offers.) And I love the comments from people who see right through what HR is doing! Just how does anyone in HR justify this demand for private information?

matrix-bring-it-onNick’s Quick Reply

I have a standing challenge to anyone that works in HR: Give me one good reason why you need to know a job applicant’s current salary.

Many have tried, but no one can deliver a good reason, because there isn’t one. (If you work in HR and want to take your best shot, please post your response in the comments section below.)

But I’ll let an HR manager answer your question. She upbraids me for telling job applicants not to disclose their salary in a job interview. This is such a bold admission that I quote it in Keep Your Salary Under Wraps.

“Employers want your salary information because they believe that if you apply for a job that starts at $50,000, but you made $30,000 in the same sort of job at your last company, they’d be overpaying. They’d want the opportunity to buy you for $35,000 to start, saving them $15,000.

“The HR person who does that gets many kudos for their shopping moxie from their boss, and gets to keep their job and go on many more shopping trips.

“I’ve been a vice president of HR, a recruiter, a labor negotiator and a candidate, so I know from which I speak [sic]… I am so dismayed that someone pays you to hand out this kind of information.”

You can’t make up stuff like this.

The trouble is, you can’t make these kinds of HR managers go away, either.

I repeat my challenge. Give me one good reason why HR needs to know a job applicant’s salary. Bring it on.

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  1. I ran into a recruiter that took the same attitude as the HR manager in your article. She insisted on me disclosing my previous salaries, and said that some of her candidates are obliged to turn over tax forms so that she can verify accuracy.

    The argument she used was that this was part of a “transparent” process and she would be representing me. I didn’t know what to say to that since it was utter rubbish. The recruiter does not represent the job hunter, nor do they disclose the salary history of the role, how many candidates they are putting forward, or what their terms are with the hiring company.

    If the HR wants my salary I want their hiring manager’s salary so I can start establishing what the ceiling for the salary should be.

    • Have you ever tried that as a serious negotiating tactic? “Sure, let’s go fully transparent. I’ll be happy to disclose my full salary history if you will disclose the current salary of the hiring manager and everyone with the same job I’m interviewing for.”

      • Ed: I know people who’ve done exactly what Michael suggests. You have to be ready to be booted out of the interview, even if you do it politely and respectfully. The mindset of HR and many managers is that your private information is theirs for the asking because you’re the supplicant, doing tricks to get a job. Yet they cry “Talent Shortage!” all the while! It’s so stupid that it’s beyond belief. I think most of them don’t realize what this all implies.

        I think the best way to do this is by suggesting the employer consider what they’re asking for. “Suppose I asked your salary, so I can judge whether you’re worth working for. I doubt you’d want to tell me, so please understand that I’d like to keep my salary private, too.”

        Most still won’t get it. They’re brainwashed.

        • @Nick, I was booted from that interview, without even learning what the opportunity was. I made the judgement call that the recruiter was not worth doing business with. I hung up on her.

          In most cases, I just reverse the question and ask what the job pays. Mostly HR tells me, and in other cases I find that they actually do not have a range which is rather weak. It seems to be rather rare for me to run into HR that insists on having my previous salary. I think that HR is not used to applicants pushing back when the questions become invasive.

        • Nick: I try to always be ready to be booted out of an interview. I figure that if they don’t like me being myself, then I’m not going to like working for them, so getting booted out is no big loss.

          • Ed: When you consider that probably 90% (99%) of applications result in no interviews, much less job offers, it’s really no risk to judge the employer at step one, and to walk away if you don’t like what you see. It actually helps promote the best employers, and to improve those who dare to get better at hiring. The rest are leavings for the Chapter 11 lawyers.

            My compliments. You always have to be ready to walk if you want any kind of negotiating position at all.

  2. The media just feed in to this illogical, unethical idiocy. Check this article:
    “New Massachusetts Law Banning Employers From Asking Salary History Could Hurt Employees”

    The writer, Rachel Greszler, makes some really stoopid assertions:

    “Previous pay indicates an employee’s value to their past employers. Often times, pay is even more telling than education or experience. Withholding valuable information from an employer will only lead to wasted time, low-ball salary offers, and more job turnover.”

    Gimme a break. All it will lead to is stoopid guesswork by an employer who doesn’t know how to judge your value itself.

    “Prohibiting employers from asking about pay history will lead to wasted time as employers will interview candidates that they cannot afford to hire.”

    The writer should be fired for this one. She fails to consider a more prudent solution: The employer should just disclose the salary range on the job. It’ll save time.

    “And finally, if an employer makes too high an offer—one significantly above what the employee previously earned—there is greater chance that the employee won’t measure up to expectations and will be demoted or fired.”

    Say WHAAAAT??? This is a writer casting about for something intelligent to say, without realizing her speculation is idiotic.

    “For employees, pay indicates the requirements and conditions of a job. For employers, pay indicates the value of an employee. For the same reason that potential employees should be able to ask the pay of positions they apply for, employers should also be able to ask potential hires about their previous pay.”

    This proves that publishers are hiring anybody to write “columns.”

    • I would like to know Rachel Greszler’s salary so I can decide whether or not to read that full article. If she’s paid a lot, there’s a significant chance that article won’t measure up to my expectations.

    • Um…the Daily Signal comes courtesy of the Heritage Foundation, where anything that might suggest the holy free market has flaws is considered evil…just sayin’…

      • On behalf of everyone who ever wrote for a place like the Heritage Foundation, I apologize. My articles were re-written *all the time* when I wrote for a similar paper. Once, I was assigned an incredibly technical piece, and my editor said, “You don’t have to understand the details of it–just report it.” ???? Another time, I was BLASTED with 1000 emails for inaccuracies that weren’t even mine. (smh) That’s the state of journalism today—we just need something by *tonight* whether it’s accurate or not!

        • Molly: Thanks for the reality check from the other side of the pen. My columns have been licensed by many publishers over the years. I’ve been fortunate to work with editors who have uncommon integrity. I hope you find the same on your next gig!

    • I keep saying that there are 101 variables to the salary you have at one employer.

      My former employer, before being acquired, didn’t give raises and/or promotions for several years due to their financial difficulties. Individuals and departments may have been meeting/exceeding their goals but their pay may not have been reflective of that. When I finally left for greener pastures, I am making quite a bit more. At a minimum, I wanted to make up for the COL raises (plus a fudge factor) that I had missed out on.

      Secondly, in many cases, it doesn’t make sense to leave a job for a measly 5% raise, all else being equal.

      I also echo Nick’s advice about being willing to walk away, especially if you can afford to. Nothing will end bad behavior unless enough people say “no.” I have walked away from bad behavior and in one instance, the company did declare Chapter 11 no less than 6 months later.

      What actually matters is whether you can do the job at hand, well. It requires some homework to be done, and too many times, hiring authorities get lazy and want to take a short cut and use salary as some sort of end all and be all.

  3. I just finished reading the article and comments. Talk about stupid!!! So Company A needs to know (to point of requiring me to disclose) my salary history, which spans decades, employers, and industries, in order to figure out my value, or rather the JOB’s value, to Company A. This makes absolutely no sense. Why would Company A care, much less need to know, what I earned in my first post-college job x number of years ago, and in a different industry? Nick is right–that tells me that many employers have no clue how to assess the monetary value of a particular job for their companies. And what if your salary is lower because you lived in a part of the country where the cost of living and salaries were lower. A good example is Boston–many of the salaries are inflated simply because the cost of living in the Boston area is so high. If employers paid what the actual jobs were worth, they wouldn’t be able to get workers because the workers wouldn’t be able to afford to take the jobs at the low salaries. But Podunk, Alabama isn’t Boston, so why base what you are willing to pay on Podunk, AL salaries? Or if you go from being a kindergarten teacher to being a sound engineer….does that mean that you will use my salary history as a kindergarten teacher to determine my value to you as a sound engineer for your company?

    I also noticed that the article was published by someone associated with the Heritage Foundation, which is very conservative and very pro-business. There’s nothing wrong with being conservative and pro-business, but to me, that explains the slant/take on the new MA law and the accompanying wailing about government interference and hand-wringing. My take is that businesses have been favored for quite some time, to the point that their crazy-maker policies re hiring, salary, etc. are skewed. This law (which I think doesn’t go far enough) is merely trying to get employers to figure this out for themselves and to balance things out a bit.

    Nor does it appear onerous to me. Employers can’t ask or require job seekers’ salary histories. So they’ll have to find something else to ask and discuss, such as how the candidate would do the job, how they’d solve x problem, etc. That doesn’t mean there shouldn’t be an honest, adult discussion of compensation, but that’s different from requiring it during interviews or on applications!

    And if an employer hires an incompetent person, that person will be incompetent REGARDLESS of his salary history and what salary the company pays him! Oy vey….

    • MaryBeth: You just wrote a really good article :-)

    • I would argue that Heritage has it wrong and it is not the “free market” as some people would claim. This is coming from someone who is “very conservative and pro business” ;)

      What would actually be free market is if all job postings listed how much they would be willing to pay someone as well since technically the company is buying a product/service from you (your labor). Then, asking previous salary would be less of an issue (I still think there are problems with asking for previous salary, mind you).

  4. Nick,

    Your initial HR’s comment about saving money is the crux of the situation. If HR had no skin in the game, and were only concerned about filling positions with qualified candidates WHO STAY – i.e. aren’t fired for incompetence or quit for more money elsewhere, they would not give a rats about your current/past salary. BUT, as stated, they have specific metrics tied to their OWN bonuses and promotions relating to saving Payroll money. Just like a salesman gets a bonus for reaching the Million Dollar Club (or whatever) the HR flack gets bonuses and percs for the more money they save.

    Therefore, refuse to disclose salary, you get booted, no ding to their metrics, and on to the next candidate.

    • Hank: It’s all in the way HR gets paid. That’s another discussion entirely – but I agree it explains how these problems arise.

    • This reminds me of stories I’ve heard where IT management gets bonuses for unspent budget and the employees are all using 10 year old PC’s and the servers crash/are unresponsive quite frequently (and said servers ran services that were key to completing work in a timely fashion to support projects sold). These stories didn’t usually end well because said companies usually lost any competitive advantage (and potential revenue).

      • Dave: Whether it’s a sales compensation plan or any other comp plan that includes incentives for behavior, it can be gamed. The example you give about bonuses for unspent budget… the company must be insane!

  5. Working in HR in the public sector, prior salary often comes into play due to “taxpayer accountability”. Citizens and taxpayers typically don’t feel like public sector employees should be paid at competitive levels. So, there is always this feeling that people moving between or going into public sector jobs should not be receiving significant increases for taking these jobs. Therefore, rules are created to only allow x% above the current salary. I personally and professionally do not believe that this is a good way to manage compensation. However, in the public sector HR is dealing with public politics and perceptions. In the public sector case, I think the thinking of taxpayers and elected officials needs to change in order for HR to have the leeway to get away from this approach.

    • Points well taken. But I think it’s the HR profession’s role to advocate for good, smart business (even in government organizations), and I think the profession has completely dropped this ball and failed to do what’s right. Nowhere do I see the HR profession as a whole pressing for the necessary changes.

  6. Nick,
    I just got off the phone with a client that needs a month of proposal writing for a large government bid and of course, I’m hit with the “what is your rate?” question from the more junior of the two people I conference called with. When I parried that with the demure “I’d rather just hear what you have budgeted and work from there” the more senior person stepped in and pretty much got that I wasn’t going to throw away my negotiating edge and said “no problem, we can address this later when we moved ahead with the proposal.”

    • JC: Substitute “HR” for “junior person” and we can see how employers gum up hiring good people…

      • Nick,

        You’re right.

        Having said this, getting these people to suggest a daily rate before I do is like pulling teeth.

        Heck, I even gave in a little and provided daily rate histories from three years of clients and they want me to come up with a number!

        Now, they want to know specific dates of individual consultancies in order for them “to be able to” determine a rate!

        My God, they are going up and down and round about town trying to find a way to justify a lowball salary- or to get me to pick a number and then lowball that further.

        Once you suggest a rate, they will ALWAYS go lower, so you make them go first.

        • I don’t even want to work with them anymore, actually.

          I have 2-3 other current prospects with whom I’m negotiating.

        • JC: If you deal with this frequently, you should read Wm Poundstone’s excellent book, “Priceless,” which discusses the research on how we assign value and how pricing works. It’s much more complex (and counter-intuitive) than people think. The book is very readable. You can actually get a higher offer if YOU put number out there first. It’s called the anchor effect. But the number you put out there isn’t your rate history, or even the rate you want. Check the book.

          • Thanks- I’ve just added it to my Amazon basket!

            By the way, I was telling a friend of mine about you the other day– He is in the middle of trying to squeeze his company for a big raise right after his boss leaves (his value goes way up in the boss’ absence) .

            My friend thanked me for the suggestion, and then suggested something one part hilarious and one part borderline ridiculous, but hopefully not one part insulting.

            He said that with your last name, you should brand yourself as “Crocodile Headhunter” – Totally badass, right?