Do you hear that? It’s the sound of thousands of hiring managers clacking at their keyboards, updating Indeed postings.
What happened: All B.C. job postings must now include salary ranges, as mandated by the province’s recently passed Pay Transparency Act. Employers also can’t ask how much you made at your previous job, or punish you for sharing your income with your colleagues.
- B.C.’s six biggest Crown corporations, as well as the provincial government, must also prepare annual reports on systemic pay gaps. By 2026, this will apply to every company with 50 or more employees.
Zoom out: Such laws are gaining traction across the world. The EU passed a transparency directive in April, while New York and California now require job postings to have pay ranges. In Canada, PEI also passed similar legislation to B.C.’s new laws in June of last year.
- The feds also passed the Pay Equity Act in 2021, which requires all employers in federally regulated sectors with ten or more employees to correct pay disparities.
Why it matters: Advocates argue that pay transparency laws give workers bargaining power by arming them with vital information when entering compensation talks. Likewise, early studies suggest that transparency measures do a bang-up job of reducing pay inequities.
Yes, but: Pay transparency’s effect on productivity is hotly debated. While some studies have found that knowing what co-workers make inspires employees to work harder, others have found the opposite to be true, as employees who feel underpaid start mailing it in.—QH