The state of Massachusetts – home to one of our global workspaces – recently signed the Frances Perkins Workplace Equity Act into law to help address wage disparities by promoting pay transparency.
The new legislation requires all employers of 25 or more people to disclose salary ranges on job listings – something we’ve been doing at Reward Gateway since 2021. It takes effect on July 31, 2025, and will align Massachusetts with 10 other states that have already introduced similar legislation regarding pay transparency.
But legislation aside, promoting greater pay transparency is simply the right thing to do, and can benefit your organization in many different ways. As our Senior Talent Acquisition Manager for the U.S. region, I’d like to talk about how and why this is.
The power of pay transparency
Reward Gateway has been including salary ranges on all internal and external job ads for more than three years now.
Being open about salary from the beginning of the hiring process takes the elephant out of the room, allowing candidates to focus on why they want to work here without worrying if it’s financially viable for them.
We’re a very values and mission-driven business. Being transparent about pay really makes conversations with candidates about our culture, rather than just salary, since they already know it.
Salary is, of course, super important if you want to attract and retain the best people. But by addressing role remuneration up front, recruiters can quickly move on to the stand-out elements of the organization’s employer value proposition (EVP). Looking at it through the lens of our total employee experience pyramid, a competitive and well-benchmarked salary meets a basic physiological need that needs to be fulfilled before a candidate or employee is able to move up the pyramid toward appreciation and engagement.
Transparency is always a good thing, particularly when it comes to pay. It demonstrates a level of respect and appreciation, helping to eliminate incorrect assumptions around salaries and create a more equal and inclusive company culture in the long run.
Another step toward equity
From a DEI standpoint, disclosing salary ranges on job descriptions ensures all organizations are being equitable from the start, and are prevented from adjusting salary offers based on a candidate’s background. It levels the playing field for all, regardless of who you are or where you come from. As Karen Spilka, President of the Massachusetts Senate, said:
This is simple: Everyone deserves equal pay for equal work, regardless of your gender, race, ethnicity, or background.
Salary transparency also allows a candidate to bring their authentic self to the interview, focusing on showcasing the best version of themself without having to navigate uncomfortable conversations about pay.
But the benefits of disclosing salary ranges for new roles reach further than external candidates, as elevating the conversation on pay transparency also supports employee retention by encouraging internal mobility. The mandate extends to internal transfers and promotions, requiring employers to display salaries for positions with differing responsibilities. This means that existing employees may feel more motivated to consider other opportunities within their organization, rather than looking externally for their next move, as seeing available salaries within a different team could be the nudge needed to apply.
Pay transparency is also a core contributor to financial wellbeing, which 60% of employees felt should be a top priority for employers in 2024 according to our latest HR Priority Report. Lifting the veil on earning potential across different departments within the organization supports financial education by empowering employees to take control of their career growth and plan their longer-term finances.
What do employers need to be aware of?
There’s no doubt that the new legislation will expose Massachusetts employers who are underpaying their people and not keeping up with the market. Salary benchmarking will become even more important, and employers will need to think more about what their total benefits package can offer.
But salary isn’t everything. My experience and our recent research suggests that people may shift their focus to the benefits that are most important to them over a bottom-line salary figure, so it’s important to create a multigenerational EVP that can meet the differing needs of the five(!) different generations represented in today’s workforce.
Although disclosing a salary range can remove an element of flexibility for recruiters, and may deter people with higher pay expectations from applying, more applications come in when the pay is listed. So it’s certainly a trade-off worth making, even for organizations not required by law to advertise a salary.
Don’t treat the requirement to disclose salaries as a tick-box exercise. Treat it as an opportunity to show your employees and candidates that you actually want to be transparent and you want to create a really good workplace experience.
We’ll finish up with some more top tips for companies taking the leap to pay transparency:
- Be realistic with your salary ranges – a huge range defeats the purpose!
- Include on-target earnings for commission-based roles
- Emphasize your benefits package to remove sole attention from salary
- Ensure your EVP and benefits are prominent on your career website
- Utilize your network by speaking to companies that have already rolled out transparent pay scales
Ready to take the leap?
For us, it’s a no-brainer. Organizations that embrace pay transparency have the opportunity to boost employee engagement, improve financial wellbeing, boost applicant numbers and demonstrate genuine appreciation for their people.
Come and say hello to our team of experts if you need any support in creating an irresistible EVP and a world-class employee experience.
