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Pay Transparency: Paving the way to Employee Happiness

It’s official—US workers want more pay transparency. Once considered a taboo subject, compensation is now more openly discussed among coworkers, with a multigenerational workforce happy to confront topics that were traditionally off-limits.

In the 2018 Compensation and Culture Report, we surveyed 1,200 American workers to assess employee attitudes toward compensation and benefits in the workplace, setting out to uncover perceived disparities and issues related to employees’ understanding of compensation in the US.

We discovered that workers don't believe all employees are paid equally, regardless of age, race, and gender. The findings indicate that today's workforce demands pay transparency because they believe it will motivate employees to work harder, create a better company and ultimately solve pay gap disparities among age, gender, and race.

Perhaps not surprisingly, respondents believe that the pay gap in the technology and financial services industries is the greatest, despite equal skill, performance, and experience among employees. But how can organizations make sure that they are effectively dealing with the gender pay gap, racial equality or ageism in the workforce?   

With more generations working together than ever, managers are challenged to understand how to get the highest level of engagement from as much of the workforce as possible, regardless of their generation.

Millennials hold many of the same beliefs as the baby boomers or Gen Xers, including the idea that engagement is best produced by inspirational leadership. Establishing a solid foundation of trust, connecting employees to deeper meaning in their work and rewarding them fairly will produce not only higher engagement, but also greater loyalty and stronger performance.

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Yes, compensation unhappiness does drive turnover

But it doesn’t have to be this way. Although pay is central to initiatives regarding pay fairness, happiness in your workforce doesn’t come from paying your employees more. It comes from making sure that they understand that their reward is fair.


Get the tips you need to develop programs to effectively attract and retain talent for years to come with our e-guide: How The Next Generation of Workers is Changing the Culture of Total Rewards

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