How much does your co-worker make?
It’s a question we all ask ourselves, and oftentimes, we never get the answer. But work culture is starting to shift, and more and more American workers are discussing their salaries with co-workers. In 2014, Whole Foods started an open policy where employees could look up anyone’s salary from the previous year. And the social media company Buffer made headlines when it made every employee’s salary public. Even so, the process of asking can be awkward. Here are some of the benefits of sharing your salary, and a few obstacles you may encounter along the way.
Addresses gender pay gap
A 2016 Glassdoor study looked at 505,000 salaries shared by full-time U.S. employees. From those numbers it found that, on average, men earn 24.1% more in base pay than women. However, that gap fell to 5.4% for workers when the same job title, employer and location were compared.
While more attention is being paid to the gender wage gap, it’s still having a negative impact on the wallets of American women.
“Over a lifetime, that is a loss of tens of thousands to even millions of dollars for women,” said Sarah Stoddard, Glassdoor’s career trends expert. “By embracing greater transparency in the workplace, companies can truly evaluate their pay policies and help to eliminate these gaps.”
Sharing your salary can help you secure higher pay. If your co-worker is doing the same job but is making more money, it gives you a valuable tool when you head into salary negotiations.
Improves work environment
If you don’t know how much your co-worker makes, there’s a good chance you’ll overestimate their salary. In some cases, this could lead to resentment and feelings of frustration and anger in the workplace. On the flipside, a 2013 study by Emilio Huet-Vaughn, an assistant professor of economics at Middlebury College, found that employees were more productive when they knew and could compare their salaries with those of other workers.
A similar study found that participants were more likely to work together when they understood the company’s pay structure.
Even though sharing your salary could be beneficial for you, it could also be met with opposition. Here are a few reasons your co-workers might stay mum about their earnings.
A recent survey from the financial blog Cashlorette found that 33% of older millennials (ages 27-36) openly shared their salary with co-workers. This was more than any other group. Only 8% of baby boomers (ages 53-71) disclosed their pay to co-workers, likely because they adhere to the traditional idea that it’s rude to discuss money.
Overall, just 20% of the respondents said they shared their salaries with co-workers, so don’t take it personally if a co-worker decides to keep their salary private.
The Cashlorette survey found that employees making less than $30,000 are less likely to share their salary with others.
“The biggest obstacle to salary transparency is pride and fear,” said Stoddard. “Those can be mitigated by organizations that have open conversations about pay ranges for positions within their company.”
How to talk money
Talking about your salary with co-workers will not be a one-size-fits-all approach.
Before you start the conversation, it would be a good idea to compare your salary with those of other people in the job market by using a site like Glassdoor. Its Know Your Worth tool gives you an estimate of your salary based on your title, company, location and experience. Payscale has a similar feature.
If you see large discrepancies between your pay and the current job market, it may be time to gain some insights from colleagues. Try to select an employee who has a similar title and job responsibilities. You might get some resistance, and that’s OK. Instead of asking for a precise figure, ask your co-worker for a range they’d be comfortable with. This will allow them to speak in general terms without feeling too exposed.
With this new information you’ll be in a better position to negotiate your salary. In this case, Stoddard suggests being patient and persistent with your manager.
“If you don’t receive an immediate uptick in salary, stay positive and work with your employer to come up with an action plan so you can exceed expectations and secure that pay increase in the near future,” she said.
Brittany is a reporter at Yahoo Finance. Follow her on Twitter.