Is It Legal to Prohibit Employees From Discussing Their Salaries?
Is it legal to prohibit employees from discussing their salaries? It depends on how far your prohibition goes.
While many employers don't like it, workers are generally allowed to talk about their salaries with coworkers at the water cooler. With the popularity of social media, discussing salaries online with other workers is also lawful.
The National Labor Relations Act provides some guidance on how to proceed when it comes to employees talking about their salaries. Here's a general overview:
Section 7 (29 U.S.C. § 157) of the National Labor Relations Act makes it legal for employees to discuss the terms of their employment, that gives all employees the right to "engage in concerted activities", including the right to discuss their terms and conditions of employment with each other. Section 8(a)(1) of the NLRA (29 U.S.C. § 158(a)(1)) makes it an unfair labor practice for an employer to deny or limit the Section 7 rights of employees. Based upon those two provisions, the National Labor Relations Board (NLRB) has taken the position for decades now that employers may not prohibit employees from discussing their pay and benefits, and that any attempts to do so actually violate the NLRA. Courts have basically uniformly supported that position. Moreover, those particular sections of the NLRA apply to both union and non-union employees, so there is no exception made for companies where the employees are non-unionized.
The NLRA allows private sector employees to organize into trade unions, take collective action like strikes, and engage in collective bargaining.
Since the Act is among the several federal laws that govern all workplace activity, it's important to become familiar with them.
What Salary Discussions Can Employers Limit?
Although the Act gives employees much leeway about what can be discussed at work, there are some ways that employers can lawfully limit salary discussions.
Can legally bar employees from talking about their salaries to people outside the company, the website Ask A Manager advises. That's because the NLRA only protects employee discussions within the company.
May be able to prohibit employees from discussing salary during times when they're supposed to be working. However, as the Texas Workforce Commission explains, employers should be careful about enforcing such a rule -- especially if they only limit conversations about salary, but allow the discussion of other topics during the workday. That may appear to be an NLRA violation.
However, employers could have a tough time limiting salary discussions on social networks. An NLRB memo suggests that employers must allow their employees to discuss their wages online with other employees.
Many employers use sample policies that they have found on the Internet or in collections of policies in popular office software, and some employers simply draft their own policies. With some areas of employee relations, that can work. Concerning pay and benefit discussion policies, though, it is not a good idea at all to "roll your own". Â This area of the law is so little-known by most employers and employees and so fraught with potential problems that any employer considering writing or enforcement of a policy restricting discussion of pay and benefits should definitely consult an employment law or HR specialist like the Barbelo Group who is knowledgeable about NLRA issues before taking any actions.
As an employee, talking salary might be a bad idea -- for you, not your company. Here are four ways talking about your pay can come back to haunt you.
1. It's Demoralizing for You and Your ColleaguesÂ
It can be very demotivating if you're very concerned about everyone else. Â The best piece of advice is to focus on yourself and your own career path and growth, instead of trying to compete with everybody else.
Workers have to concentrate on what they can do to have a positive impact on their pay, not about what a coworker is making.
2. Youâll Draw Conclusions Based on Incomplete Information
It's nearly impossible to make one-to-one comparisons between employees. Everyone's circumstances are different.
If you're talking about pay with people that you work with at your same company, those individuals may be compensated differently based on the job they have or their previous experience or their education or maybe some specific certification.
Outside of your workplace, it gets even more complicated, because organizations have different budgets and philosophies about pay. Salaries also vary depending on the industry and the size of the company.
3. Your Friends May Feel Forced to Lie to You
When it comes to pay, it's hard to know whom to trust.Â
The problem with talking about pay with other individuals is that it may or may not be reliable information.Â
For instance, a coworker might lie about his salary to make himself look more successful or as part of a power play. Even if your office buddy is 100 percent truthful, you'll filter the information through the lens of your relationship, which won't help you make good decisions about your position.
4. The Information May Hurt Your Chances of Getting a Raise
Managers are seldom persuaded by an employee comparing himself to his coworkers. Instead of talking about how much your neighbor makes, arm yourself with facts.Â
Salary databases like PayScale.com or salary.com and other third-party sources can provide more reliable information than water-cooler gossip, and they take into account variables -- such as education, experience and skills -- that can be missing from anecdotal information.
We encourages employees who are unclear about how pay decisions are made at their companies to talk to their managers or to HR about the pay structure. She suggests asking questions such as:
Do we have a salary range for this position?
What is my maximum earning potential in this job?
How do people move through the salary range?
Is movement based on longevity or performance?
Are there certain skills or certifications I can earn that would help me earn more money?
The goal of the conversation is two-fold: to gather information about the company's compensation plan and to demonstrate your fitness for a promotion and/or raise.
You never know.  It may turn out that based on all the criteria that the company has set out, that person truly is underpaid, and that might be a positive outcome for that employee."
