“Right thing to do": Recruiters bank on pay transparency to save time, improve equity
BC’s new salary transparency laws take effect this week and recruiters say it’ll be good for job-seekers and loyal employees alike.
The legislation requires employers to disclose a salary range for all publicly posted positions in BC. It also mandates new pay transparency reports, starting with crown corporations this year and expanding to include any company with 50 or more employees by 2026.
Mike Shekhtman, senior regional director at recruiting agency Robert Half in Vancouver, anticipates the new rules will enhance pay equity, particularly for women.
“This is good news for employees,” he told Daily Hive in an interview. “It’s the right thing to do… and applies a bit of pressure on employers to ensure that there is equity within the current system.”
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Statistics Canada reports that BC has one of the largest pay gaps in the country, with women earning 17% less than men on average. In addition, Robert Half’s own research suggests only 56% of women are likely to ask for a raise before the end of 2023 — compared to 64% of men.
In addition to helping job-seekers avoid lowball salaries, Shekhtman predicts the new pay transparency legislation could lead to gains for current employees too. Loyal employees will be able to see salary ranges for new hires at their company, which may lead to salary adjustment discussions.
Post-pandemic inflation has led to wage acceleration and pay compression — a phenomenon where companies are paying new recruits higher than long-term employees. The extent to which that’s going on at a company will be revealed by this new legislation, even before companies are mandated to release pay transparency reports.
What’s more, recruiters agree that providing a salary range saves time on both sides. Henry Goldbeck, founder of Goldbeck Recruiting Inc., says the legislation will require work in the short term, including updating listings and coaching clients. But he says it’s well worth the time saved connecting workers to roles in their range.
“We don’t want to waste people’s time talking to them about a position that they’re not going to be interested in because of the salary,” Goldbeck said.
He views the legislation as a step forward in terms of equity. What’s more, the new laws still let companies offer a star candidate a higher salary than listed in the posting — maintaining flexibility while empowering candidates to accept, negotiate, or reject an offer based on the range.
The new laws also forbid employers from asking candidates about salary history, which Shekhtman is a good thing. It will prompt employers to compensate employees for the job being done, rather than try to find a bargain based on their previous work history. What’s more, asking about past salary disadvantages those who may be new to Canada, or who were paid less at a previous position.
The only ones who may be challenged by the new legislation are companies that don’t pay as well, and may have relied on flexibility or other perks to get candidates in the door, Shekhtman added. But at the end of the day, those companies will only see applications from candidates who accept that range of pay — they won’t be flooded with resumes that don’t align with what they’re offering.
“Even if this changes one individual’s experience and drives equity, I think that the legislation is the right thing,” Shekhtman said. “I think removing intentional or unintentional biases is a great thing.”