When Massachusetts enacted their law prohibiting employers from asking for or requiring the salary history of a candidate, there was a great deal of consternation. Even though the law does not take effect until July 2018, the immediate buzz is loud. Many recruiters are panicking in fear that this legislation may well catch on and become the proverbial law of the land. You can count me among those that find this incredibly disturbing.
This week, an indistinguishable media conglomerate published an article that says there will be a bill introduced in Congress to enact this law across the United States. The aim of this bill is to (allegedly) reduce pay gaps for women and minorities, who have been most egregiously impacted by predatory hiring practices over the years. While the protection of these affected groups is long overdue, one has to wonder if this will be:
- Another bill – and eventually law – with no teeth or
- A vehicle to get some other sneaky rider into a bill that would otherwise not pass.
**Writer’s Note: I understand that what I am about to talk about it going to rub some people the wrong way. Before you fire up your Keyboard of Vengeance, know that I am IN NO WAY denying that this a good thing for the demographic populous that it is intended for. I believe we have a long, long way to go in increasing racial and gender equity. But there are other factors at play. That’s just the plain truth.
Dirty Little Secrets and #CandE
At a macro level, this is a great move for equal rights and ensuring that glass ceilings are (rightfully) shattered once and for all. You don’t have to be a card carrying feminist to know what is inherently right, but you do need to have a modicum of common sense. And laws that support this can’t be a bad thing…at a macro level. But what about the micro view of this, and its effect on what has dominated the conversation in this industry for at least the last 5 years?
You guessed it: candidate experience.
For years we’ve been talking about honesty, transparency and customization when interacting with candidates of all races, sexes, shapes and sizes. Now, with a potential law on the books that basically forbids that same honesty and transparency we’ve been clamoring for, we’re going to just toss this with the baby and the bath water?
Seriously? Instead of furthering candidate trust and experience, by having candid conversations about things that matter – like salary and feeding your brood – we’re going to start playing blind man’s bluff? In what way is that an improvement over today’s current state of affairs?
As it relates to the candidate experience, there are a variety of items recruiters need to consider. They need to know they can afford the candidate. Why would you drag them through the entire process and not be able to meet their expectations down the road, only to have them look at the offer and say “what the hell is this salary?”
And I hear the pundits now…”oh you can ask for a range”. Riiight. You and I know exactly how that ends. “I’m negotiable”. Or maybe “market competitive is fine”. Tell me again how this is better than saying: “Can you share with me what your compensation package looks like today, and what you’re seeking for going forward?” It’s not.
You Don’t Know Me: Reality and Salary Revelations
I know there are bad apples and hucksters out there in the recruiting field, just as there are in the financial industry (and every other one, for that matter). But I don’t see any new laws being passed to ensure that Wells Fargo doesn’t create 20,000 more fake accounts to hit their sales goals. Instead, they get to suffer the indignity of having to eat their quotas for the year, and then it’s back to business as usual. And surely as the sun will rise, some recruiters want to get people for as cheap as possible.
But let’s look deeper at that and break it down by types of recruiters for the sake of argument. Executive recruiters and direct placement firms naturally want their candidate to get the highest salary possible, regardless of gender or color, as this mathematically translates into a more lucrative fee. Contingent recruiters might find that they live in a grayer area, because bill rates are generally set by the client, so paying a candidate more money on a firm bill rate means less spread for them, and in turn a smaller commission.
But what about the corporate recruiter? Corporate recruiting directives can certainly go either way. Scenarios exist where recruiters are instructed to seek out and hire talent for as cheap as they can. This isn’t a fallacy folks, this happens. Spend 10 minutes looking at job descriptions where they are clearly trying to cram 3 jobs into the price of one.
In the corporate recruiting world, you’re not in it only for yourself and to line your pockets (not that there is anything wrong with that – #capitalism), but rather you represent your company, and will likely need to work with or hire for this candidate one day. Doing right by them is in your future self’s best interest. Corporate recruiters have ample amounts of market data available at their fingertips, and at the outset of a recruiting effort one can assess the data and progress to ensure that they are in the right ballpark for salary. This takes into account the demand for the skill set, the geographic location and the level in the organization.
We’re not guessing here. We’re also not arbitrarily saying, “well Sally is good, but she’s not 100k good. But this John guy, he’s a 125k without a doubt!” I’d fire any recruiter I knew operating like this, and I assume most of you would too. Recruiters, especially those in hyper-competitive industries, want to find out the whole package, including all the perks and pluses that someone might be getting, so that they can see how they stack up. If you can’t ask that, you are playing blind.
For example – if after a company can offer a large bonus, a clear growth path, and a few other life-balancing benefits (but not a massive salary increase), these may be worth someone making the decision to come work with them. This is a business and any leg up on the competition is helpful. After all, that’s our job – to find people, information and hire the best people we can. And why wouldn’t you want to pay them as well as you are able to? Why give them a reason to start looking in 6 months? I don’t know, maybe it’s me, but I was trained to look out for both sides – the candidate and the company.
I don’t have the resolution here today, though I wish I did. But, I genuinely trust (hope?) that there will be a solution that doesn’t handcuff either side. Perhaps the answer is not further handicapping an already unstable process that is historically laden with mistrust on both ends. There is a tightrope to walk in recruiting, where we as professionals need to be cost efficient AND attract qualified talent and salary is a key tool.
Maybe, just maybe, it would be prudent to invest in better trained and equipped recruiters, those who can balance the legal as well as the interpersonal aspects. And friends, a high level of integrity and a commitment to ongoing professional self-education know no gender or color bias.
This article first appeared on RecruitingDaily on September 27, 2016.
Pete has nailed the insanity issues associated with our “government” attempting to regulate every molecular detail of business. As a culture, we’ve long ago abandoned the practice of recruiting and hiring based on things that matter, like background, education, skill sets, knowledge, experience, professional maturity, and proven performance. The government has ensured that our only hiring considerations now are the color of the candidate’s skin, their gender, and their cultural background. Within the government contracting industry, every federal agency has adopted the ridiculous lowest-price, technically acceptable (LPTA) approach to awarding contracts. In order to compete within that market, employers are forced to push prices to the very bottom. There is no conceivable way to avoid pushing employee compensation to the bottom right along with profit margins. Yet, that same government, who insists that we cannot ask a candidate about compensation, expects contracting firms to offer bottom of the barrel rates, while simultaneously guaranteeing federal customers that all incumbent employees will be retained – at or above their current compensation packages. They want the best and brightest that the labor pool has to offer, as long as they are the desired color, gender and ethnicity, and oh yeah, at rates normally offered to fast food workers or parking attendants.