Women at Work - Let’s Talk About Money

Episode Date: October 14, 2019

Talking with colleagues about how much we earn can help us figure out if we’re being paid fairly, but sharing those numbers is stressful. With the help of experts, we discuss the tricky practicalities of salary disclosure and what to do with that sensitive information once we’ve got it. Guests: Zoë Cullen, Gaby Dunn, and Amelia Ransom. Our theme music is Matt Hill’s “City In Motion,” provided by Audio Network.

Over 40,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one platform. Download the CFO's Guide to AI and Machine Learning for free at netsuite.com slash women at work. Salaries are, have always been the yardstick, you know, in, in, oh my God, in Pride and Prejudice. It's right there. You know, Mr. Darcy, he gets 400 a year or whatever it was. And you learn this from the moment, you know, you hatch that, that this is the way the world looks at things. I remember finding out that, you know, someone was making, a guy was making way more than I, and feeling embarrassed because I thought we were equals. But when the yardstick came out and I was a couple of inches short, that really hurt. Yeah. And yet, I think it's still important we have that information. You're listening to Women at Work from Harvard Business Review. I'm Nicole Torres. I'm Amy Gallo.

And I'm Amy Bernstein. Talking with colleagues about what we earn can get us useful information. Having numbers from people in our office and in our field helps us figure out if we're being paid fairly. It can help us see where our career is heading and if we need to change course. So then why not be more open about our salary? Well, one reason is that talking about salary, sharing that number can be really stressful. And learning that you're making less or more than a peer is at best awkward and at worst devastating. And apart from managing these emotions, there are a lot of practical questions, too, like who should we tell and when and how? Plus, how do you deal with any unfairness that you might discover?

This episode, we're working through the complexities of salary disclosure, how we feel about it, ways we can ask, what are you making, and what to do with that sensitive information once you've got it. Nicole talks with an economist who's been documenting people's determination to keep their salaries to themselves, including how much they'd pay to stop that information from getting out to colleagues. I talk with the host of the Bad With Money podcast, who's seen a lot of good come from conversations that feel bad at first. And Amy B. talks with an HR executive who has no problem with employees comparing notes on what they're making. She's done it herself, in fact. And then we come back together and discuss how their insights and advice square with our experiences and what the main

takeaways are. First up, my conversation with Zoe Cullen. Zoe is a professor at Harvard Business School. She's interested in pay transparency, the gender wage gap, and the fact that we have jobs to make something that many of us believe is too sensitive to talk about, money. As an economist, it seems quite weird that we wouldn't know the prices involved in all of these things, but I think personally, and especially after doing this research, it's not surprising at all given how impactful the information is once revealed. This research Zoe's done with her colleague Ricardo Perez-Truglia happened at a large commercial bank in Asia. What they observed there in an experiment with several

hundred of the bank's employees showed them just how taboo sharing salaries can be and the potential consequences of breaking that taboo. First, they needed to find out what these employees knew or what they thought they knew about their colleagues' salaries. So they asked them to play a game. Guess the average salary of a group of five of your peers. You have their names right in front of you. Win a cash prize for getting close to the actual average. We found that workers were, on average, overconfident in how much information they had. So about 60% of them thought that they

were able to guess that average within about 5%. And in fact, about half of that number is the reality. So about a third of people were able to guess within 5%. And this is even when we introduced fancy prizes for correct guesses. So they were incentivized to tell us the truth. Did you see any gender effects? Like I'm wondering, are women more sensitive about that stuff? So yeah, so women are less confident in the information that they have, as in they're less likely to say that they know about the average salaries of their peers, conditional on what they actually do know, than their male counterparts.

What is a consequence of that? Right. So I think when deciding whether or not to renegotiate salary or to approach an employer and ask for a raise, one question at the back of one's mind might be, how accurate is the information that I have? And that could very well affect how likely they are to bring the information up in that negotiation or to even decide to approach the employer in the first place. So much less confident in their information, but on average, very similarly informed. And so, you know, in essence, they were able to, when they made guesses about what others were earning, take information they had about

their own salary, so maybe a better signal about what women were earning, and adjust for the share men in that group to get estimates that were as accurate as what men were guessing. Likewise, men would have to essentially understand that women were earning less. It just seemed that there was already sort of an intuitive sense of what the gaps were. Some employees wanted more than an intuitive sense of what others at the bank were making. They wanted numbers, and they were willing to pay for them.

Well, so we offered people to buy information about salary, and we could see who was interested in finding out this information. And about half of people are uninterested in purchasing this information or they would pay a very small amount of money. And for the other half of the population that we studied, their willingness to pay for salary information was very high, on average, two weeks worth of their salary. Wow. So, and you know, there's not many things that would predict who is uninterested and who is interested. But one thing that does seem to be quite predictive is whether that person is up for a promotion, up for a raise. Right. And so you can see that there's sort of like this, there's

this important function that salary information plays in your own take-home pay. And outside of that, perhaps people are not that interested. Got it. That makes sense. So can you tell us specifically about your research into the benefits of pay transparency? So if someone finds out how much the person they sit next to makes makes? Like what generally happens? So there's some evidence to suggest that when you first learn about how your salary compares to the average of your peers, that you respond in a negative way if you find out you're earning less than you anticipated in relative terms, and a positive reaction if you find out that you're making more than you

anticipated. And the negative reaction can be captured in a couple of ways. It certainly was apparent in the number of hours people chose to work, in the number of emails that they would send. Okay, so if you find out you're making less than the co-worker who sits next to you, that will have a real impact on your performance at work. What happens when you find out what your boss makes relative to what you make? So in fact, learning what your boss makes, people typically underestimate what their boss earns. And so finding out that information is, is most often positive news in the sense that you find out that, in fact, your boss earns more than what you were anticipating,

and we see that that's quite motivating. In fact, across the board, people were motivated to come in to work longer, to sell more, and to work harder when finding out that their boss earned more than they expected. So back to Zoe and Ricardo's experiment at the bank. They also measured how much people cared about their peers learning what they themselves were making. They sent each employee an email. It included that person's name, salary, and seniority.

And it said that they were considering sending that email with all this information to the five peers whose average salary they had guessed earlier in the game. And then we asked, you know, we would be willing to send this email. Would you like us to send this email? And the vast majority of people would not like us to send that email. So only about 20% wanted us to. And among the ones that didn't want us to send that email, 40% were willing to pay us over three days worth of salary to just keep us from sending that email. So there was a really strong willingness to pay to prevent that information from being disclosed. And that was in the context of a game where it was coming from us researchers. So it sort of removed already some of the social friction around introducing sensitive information to a peer. And did you get a sense of why that reluctance to let that information

get out there? Yeah, so well, you can ask this question of like, what were the patterns in who was willing to reveal, who was not willing to reveal, and also what relationship they had to the person who would be on the receiving end. And we did see that even when the recipient had spent more time working together with the person who might reveal, it didn't affect how willing they were to open up. And at the same time, as they rose in relative perceived status, they still were no more likely to reveal their salary information. Typically, if you think your social status is high relative to others,

you might be less inclined to keep that information secret. It would reflect that you're at the top of this distribution. So it does seem like a sort of an entrenched norm that sort of isn't explained by traditional status concerns. From here out, Zoe and I touch on a few other aspects of sharing salary information, starting with what sort of benefits or what kind of fallout should we expect once we do it? Yeah, so it's a complex question because it requires understanding what you believe to be true about the recipient of that information and also what you imagine you're going to receive back.

And so in a typical situation, given what I know about how uninformed people are about what others are earning, I do think they'd have a hard time guessing whether or not their information would be information that made the person feel better or worse, or whether or not that information would be useful or not useful in their negotiation. I think there's quite a lot of apprehension, and rightfully so, about what the impact of that information might be, because we do see that it matters what people's relative earnings are. Okay, so it really, it sounds like it's just really context dependent, you know, whether my sharing how much I make with Amanda, our producer, will lead to, you know, whether that will benefit either one of us. Like, it really depends on what the situation is, what our relative earnings are, like what our motivations for'll just highlight a specific tension, right? So imagine that the most valuable information for helping your peer renegotiate for higher pay is information about your earning more than your particular peer. And in conversation, of course, this isn't anonymous information. You guys probably think of each other as a reference person and you've had a relationship. And so when you reveal your higher pay with like the best intentions,

we also know that that can have this demoralizing effect even if it has a corresponding information benefit. So there's something that we could think about doing which is difficult in the context you described but could be instituted more broadly which is difficult in the context you described, but could be instituted more broadly, which is sort of how do you reveal this information without making it personal, without having your personal identity associated with that information so that your peer receives the information, but it doesn't trigger the social concerns associated with it.

I see. So it's like better to discover, you know, what my peers are making, if they're making a lot more than me, like in kind of an abstract anonymous forum, like online, I see what the salary pay gaps are. And I suddenly know where I fit in the pay gap versus a coworker being like, oh, I make this much. And it's like, you know, whatever, 20% more than you're making, because that could be super demoralizing for me, even though I have that information. Yeah. So maybe you said the answer in that question, which is maybe the best thing to do would be to put that information on Glassdoor or on PayScale. Interesting. I'd love to know what you think about some of these recent laws that have been passed, like the one in Massachusetts that prohibit employers from asking job applicants about

what they've made previously. What do we know about how these laws are working? Right. So actually, a colleague of mine, Laura Adler, has interviewed HR professionals and asked them, now that the law is in place, how do you go about soliciting information about what a person earns? And from my conversations with her, my understanding as an employer will typically say, not what have you made, but what do you expect to make? And so I think with that in mind, the way an employee might respond or why an economist would expect an employee to respond is essentially to think about choosing the highest salary possible conditional on still being accepted for that job. And it's about credibly communicating that that's the salary

that you would accept. And if the employer were to come back with a much lower offer, then you, the employee, would walk away. And so I think that's the way that we expect the bargaining process to go. And if so, one prediction is that for the employees who think that their past earnings are higher than average, maybe much higher than average, they can always go ahead and reveal that information. And it's sort of a way of saying to the employer in a credible way, these are my outside options. And so the employer will know that if somebody chooses not to reveal their information, probably they're on the lower end of the spectrum. But do you think that asking, you know, what do you expect to make versus what you did make, do you think that will help in the aim of this law? Yeah, I think it very well could.

I mean, the idea behind this is, you know, that women who have stepped out of the labor market for some period, their most recent salary might be lower than an equally prepared male. And so the idea is sort of, you know, to keep this from being persistent. If they have enough, if a female candidate who has had a lower past salary has enough information to know that they shouldn't just ask for the typical 10% higher over their past salaries and in fact corrects for what they should be earning

had they not stepped out of the labor market at that time, then, in fact, it could be that the salaries they ask for are more similar than the salaries men ask for. I mean, we have to keep in mind, though, that all the things the employer can see, the employer sees the gender of the employee and can always make inferences based on this. So I think the verdict is still out yet on how this is going to play out. Okay. So I'm also curious how the research you've done on salary disclosure has affected the way you approach this in your own life. Well, I get a lot of information so i think people have for the last three years now disclosed to me um any kind of salary secret that they have on account of reading

papers that i've written um and i've also been asked the question of what i'm earning probably more often than than the average person um i i certainly disclose to my mentees and essentially the people who are considering the path towards academics, in part because I think they probably were in a position like me where they didn't realize you could have a lucrative job in academia. So it's very context specific. I certainly had no information about what professors were paid at the time I chose to go into grad school. Like, you know, many people have to make a decision about business schools or economics departments, all these types of decisions that are really sort of like almost ad hoc decisions at the very end of their training. And I think salary information can be persuasive on the margin. So I do share that information.

Okay. Zoe, thank you so much for taking some time and chatting with me today. Oh, thank you. It's been a pleasure. I'm not surprised that this is an uncomfortable topic. That's part of what motivated us to do this episode in the first place is this is just such a sensitive issue for so many people. But I was surprised to hear Zoe talk about the results of her research around what people would be willing to pay to keep their salaries secret. And, you know, for me, it's so much about the discomfort of having to have the conversation. It's less about the numbers. Our next guest

really has no concern about sharing those numbers. She actually talks quite openly about how much she's made for different work. And she's really built her current career around the idea that we should talk about money more openly. Gabby Dunn is a comedian, journalist, host of the Bad With Money podcast, and the author of the Bad With Money book. on your show, in your book, that your salary at BuzzFeed was $55,000 and that you had an $150,000 advance on the book. How did it feel at first to have those numbers out in the world? The BuzzFeed job I was at for about eight months in 2014, I think, 2014 into 2015. So that was my salary during that time. And then I ended up selling the bad with money book two years later. So 2017 after I had left BuzzFeed and been freelance for a while.

So I think like it was interesting to have the the BuzzFeed stuff because I think there there were people that were being paid very, very differently. I remember there was a night where all of us were a little drunk and we started saying our salaries and it like blew up because we, you know, certain people that we thought of as huge and big assets to the company were actually making less versus like also people that had the same exact job that I did and literally sat next to me and we had the same job title were making less than me or people that we did. We also had the same job they were making like one guy was making like twenty five thousand dollars more than me. So it was like really strange and we couldn't figure out

what the metric was. And it ended up just like it was great to have those numbers out there because I think it helped people be like, you know, yeah. What is the metric? And also to negotiate and be like, wait a minute. But I know that this person makes this amount of money. You know, I think with the with the book deal, I had the misconception of like, well, I'm going to get all that money at once. And like that is not the case. So, you know, it took me a year to actually write the book. And then, you know, agents take some publicists take some managers take some. And so like, whatever idea I had of that money, I, I knew it was great, but it would end up kind of coming out to like a decent yearly salary, rather than when you hear that number all at once you're like oh my god that person like had a windfall and got rich overnight so the the main thing that

um i didn't love about having the the book deal number out there was that it became like a lightning rod of misconception for people who don't who who make a weekly salary and don't understand that freelancing is like a dump of money and then you might not get paid again for another 12 months and you're like right okay how do I make this last how do I budget how do I really be mindful and careful about this number to make sure that this lasts because I may not get another check until I turn this book in right but the only way that we can have any sort of information with which to negotiate, with which to, you know, help people out of poverty, with which to see like what people are making for their work or whatever. Like the only way we can do that is with exact numbers.

But hardly anyone speaks in exact numbers because I think it causes such an emotional reaction in other people. Yeah. Yeah. I'm curious. I want to go back to the BuzzFeed conversation where people started disclosing drunkenly disclosing their salaries. Yeah. Because you said the conversation blew up. And I'm curious, were there like tears? Were people yelling at each other? Like, what do you mean when you say it blew up? No, nobody was crying.

Everyone was just kind of. Yeah, it got rowdy in the pizza restaurant. Everyone was just kind of yelling because we were shocked by what certain people were making. And we were, and like everyone kind of, kind of started like boosting. Like people were like,

no, you deserve more. Like everyone started like, like all of a sudden becoming hype men for each other. Where we were like, you got to go in there and you got to ask for what I had. You got to you got to do this. And like what you do this thing and this thing and this thing.

You got to ask for more money. And like everyone just kind of started being like, that's crazy. That's too low. And like all these things that I think maybe everyone had in the back of their mind. But then to have like a bunch of your friends be like, wait minute which was very kind it ended up being very kind on my end there was a guy who I felt didn't do a lot and then he was making more money than me I would I didn't confront him directly about it during this conversation but in my mind I became angry and I brought it up in a meeting uh later I was like, it's not his fault.

It's someone else's fault. And like, what is this? Right. So is that something? Have you told other friends of yours or people who've come to you for advice to have those sorts of conversations? Oh, I think you should. I think you absolutely should. Your management doesn't want you to. The bosses don't want you to. And I have to I do think part of pay transparency, I think it was actually Rachel Sherman, who who I saw a quote in an article is saying that taboo around money is very convenient for employers. Right. Yes. Yes, absolutely. They want you to be ashamed. And there's something really powerful in being willing and able to talk about it. We almost transfer the power to ourselves as opposed to employers and HR folks who I think lots of them have our best interests at heart. But as we see from lots lots of research that is not being actualized for for many people no no they're not your the company is not your friend uh at all uh

that's a thing ashley ford says a lot and i love uh the company's not your friend um right and they don't have to uh no they are benefiting from your shame. Absolutely. I would absolutely say, I would absolutely say to disclose your salary to your coworkers, to talk about salary, to talk about what you're doing in terms of negotiating, to be like,

here's how many hours I'm putting in and here's what I'm getting. You know, are you staying after? Are you like how many videos, you know, for example, at BuzzFeed, like how many videos did you turn in this month? Okay, that's interesting.

That's like two more than I turned in. And yet you're getting paid less. Why is that? Or like even going in as a group, like if there's a group of you who are like all women or all black people or all, you know, Asian people or whatever, and you're noticing a trend like go in there and be like, hey, all of us together have this question like i think i think there's this misconception that like workplaces are a family um and and they're not like it's not like oh we're a family we shouldn't like rock the boat it's like no no you're getting paid to be there so you should absolutely like be open about what what like just make sure you're getting the most amount that you can and make sure that you like have other people backing you up.

And, you know, I think it's like you have to figure out who your actual allies are. Right. I actually have this theory actually from listening to your podcast because I think it's the conversation about the specific number itself

that's really uncomfortable yeah and you have you have that friend who said he wanted to just like post his w-2 on his on his door oh yeah my friend andrew t that i used to work with at comedy central yeah and i just feel like when i think about having to say the number out loud of what i make it makes me really uncomfortable. But when I think about other people having that information, it makes me less uncomfortable. And I wonder how much of it is the actual interaction where you have to watch someone's reaction, whether they're shocked or upset for you. Like, how much is it the actual dynamic between you two versus the number? Yeah, I mean, I think nobody wants to be pitied and nobody wants to, you know, nobody wants to. I mean, I felt very ignorant. Like when I when that when when that

guy was like, oh, this is what I'm making. I and it was so much more than me. I was shocked because I felt like I felt like, I felt like, oh, I should have known better. I should have known to go in with a higher number. I should have known, you know, to ask for more. I can't believe I didn't even think about this. I can't believe I was so complacent. Like it really lights a fire under you because you're embarrassed

because if you're making a lot more than someone, then I felt guilty because I was like, well, what? well what oh my god like you do exactly what I do like what the hell but if I was making way less than someone I would be like oh my god I'm a bad negotiator I'm bad at business I can't believe I did I just was like la la la walking around the office it was this thing of like oh my god i'm walking around the office doing this work and someone here in management and hr knows that this person's making more than me and i look uh like a dummy right um like a chump like a chump yeah nobody wants to look like a chump so that's like what's hard about the actual numbers yeah we put our self-worth in it yeah and we we heard from zoe cullen who's an economist who's researched this and she said she's documented that there are costs to learning that your peers make

more than you um some of which you just articulated um but i'm curious are you still glad you had that information even though it made you feel silly or stupid? Yeah, I mean, absolutely. Because I didn't stay there very long. And I think I had no concept for a long time about what a good salary was. I just didn't know. And so also it manifests in this thing where you are like, well, I have a good salary

or at least what I think a good salary is in my mind. But yet I'm not able to pay these bills. I'm not able to do this. I'm not able to do that. Is this because I'm a bad person? Is this a me failure? Rather so like a lot of stuff with my podcast and with the bad with money book is is the realization that things that I thought were me failures.

Oh, wow. I'm bad. I'm a a bad person I'm bad with money I'm ignorant whatever all this is um later I ended up like have because of the specifics and because of having all the information I was like oh no no no this is other people that are are screwing everyone over this is uh this is a result of like uh either structural injustice or corporate greed or all this other stuff that i could have gone the rest of my life being like i'm i'm just not good enough when in actual reality uh it had nothing to do with me being good enough it had to do with uh like unfair pay structures Right. I actually have a friend who does a lot of

paid speaking. And she was at this conference once where she, you know, had what she thought was an intense negotiation with the organizers. She was getting paid. I can't even remember the amount, let's say 10,000 for the for the talk. And then she was sitting in the back of the room with the organizer where a man was speaking. And the organizer said, oh, my gosh, you won't believe what we had to pay him. And it was like $30,000. And she was like, oh, my gosh, I'm on the same stage giving the same length talk. And she just said it was awful. And she said she sat there the whole time going, I can't believe I let myself get paid this little, where she had been really

happy with the 10,000, you know, and so it was really demoralizing. But then she also had to wonder, is this about gender? You know, is this she, you know, is this about my race? Like she had to, she had really had to wonder all of that. But ultimately, she said she ended up raising her rates as a result. So, so you know I think those negative emotions as awful as they feel can end up with really positive outcomes like you've discussed and talk to other people that are that are like you because I think I think it's maybe like a leap and like a leap of faith to do but there was a girl I was I was speaking um at a festival and this girl was also speaking like literally on the same lineup as me like right before me and she messaged me we knew

each other a little bit but we had never met in person but you know on twitter and she messaged me and was like hey I see you're on the lineup what are they paying you and I was like oh they're paying me this amount and she was like okay well that's like um more than what I'm making and I said oh go back to them say say Gabby Dunn told me that she's making this amount why am I not making this amount like I was like use my name feel free and she was like okay so she went and did that and then they raised her her rate because that's awesome yeah and I and I was like in my mind I was like you know what if she does that and then they come to me and they're like hey you shouldn't have done

that like you shouldn't why you know we're gonna cancel your speech or whatever it is I was like prepared I was like okay I'm prepared for them to like if that's the case then like whatever you know I'll walk I was okay with walking away from the amount of money because I was like and also I would have probably put them on blast because that's what I do. But but, you know, I was like I was like, oh, girl, she was like, I'm going to just say that somebody told me and I was like, no, you say Gabby Dunn. Link them to my page like I don't care. Right. Well, Gabby, thank you so much for talking to us. This was great. Yeah, thank you for having me.

What does the future hold for business? Can someone please invent a crystal ball? Until then, over 40,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one platform. With real-time insights and forecasting, you're able to peer into the future and seize new opportunities. Download the CFO's Guide to AI and Machine Learning for free at netsuite.com slash women at work. That's netsuite.com slash women at work. That's netsuite.com slash women at work. Hey listeners, if you want to hear from more leaders

to help you answer questions like, should I talk about my anxiety at work? Or how do I claim my leadership power? Then you should listen to TED Business, hosted by Columbia Business School professor Madhupe Akinnola. The show features TED Talks about everything from setting smart goals to the latest on DEI in business, followed up with a mini lesson from Madhupe on how to apply these lessons in your own life. Listen to TED Business wherever you get your podcasts. HR keeps coming up in these conversations that we're having about salary disclosure.

Zoe and I talked about how in some places in the U.S., HR is shifting from asking people what they made in their previous job to what they expect to make in the job that they're applying for, and, you know, what the consequences of that might be for women. Now her research is turning to how HR comes up with the salaries it offers employees. Yeah, and Gabby talked about how, I mean, she says the company is not your friend, and she, you know she basically implies that HR doesn't want us to be having these conversations. So because HR keeps coming up, we thought we'd talk to someone who actually works in HR. Amelia Ransom is an HR leader, first at Nordstrom and now at tax software company Avalara. Her official title there is Senior Director of Engagement and Diversity.

And she seems like someone who's quite progressive for an HR person, especially around these issues, someone who wants us to be having these conversations, not, you know, standing in our way of it. Yeah, she seems chill. So listen for yourself. Here's our conversation. Okay, Amelia, thanks so much for joining us to talk about this. Thanks for having me. So talk about the first time you talked to a colleague about what you were making and tell us about that conversation. What came of it? Yeah, I remember it distinctly. I was a store manager and we were having a conversation because I had gotten a refund from my 401k and I didn't understand why.

And I asked a colleague if she had gotten a refund and she said no. And I said, oh, that's weird. So I went to HR and figured out that there's this test that they call the anti-discrimination test, which has nothing to do with race or gender. But it's a test for 401k plans because essentially they don't want 401k plans to be shelters for rich people. They want them to be retirement savings plans for everyday people. And when you don't pass that test, meaning you don't have enough lower wage earners, I'm using air quotes you can't see, they punish you in a way by telling the high wage earners that they can't save as much as they thought they could save and you have to have that as taxable income to incentivize companies to get everybody in the plan, right? So I got a refund because I had just met the threshold and the mark at that time, and I'm not sure if it's the same marker, was $100,000 identified you from a government standpoint

as a high wage earner. Well, my friend and colleague didn't get a refund because she wasn't at $100,000. And so that is what sparked the conversation around salary. Now, she wasn't very far off me. I think she was at $100,000. And so that is what sparked the conversation around salary. Now, she wasn't very far off me. I think she was making $98,000 and I was making like $102,000 or $103,000 or something like that. So we weren't far off, but it sparked that first conversation about pay. And we sort of unwittingly got ourselves there, right? We didn't really intend to talk about pay. But I have to say, it wasn't uncomfortable.

We both were transparent with one another, both shared. We felt like there was equity in the band. I had been doing my job a little bit longer than she'd been doing her job. And so it felt, I don't think either of us came away feeling like, huh, I'm not being paid enough or what's off here. But it was that first conversation I had about it. And I'm thankful that it went as well as it did. Yeah, you were lucky because I can imagine many ways that it would have gone off the rails quickly. Oh, absolutely. And this was someone that's still a friend of mine that I still, you know, there was a lot of trust in our relationship at the

time and there still is now. But I imagine if I'd had that conversation with someone that I didn't have that trust established with and if there had been more of But I imagine if I'd had that conversation with someone that I didn't have that trust established with, and if there had been more of a pay disparity, I mean, all the ways that you can imagine, right, that that would have gone differently. Yeah, yeah. So who in your life knows what you earn now? There are actually a lot of people that know what I earn now. All of the people that I mentor know what I make. My significant other knows what I make. I don't have children, but my nieces know what I make. And I have other family members that know.

Well, I have one other family member that I can think of off the top of why I shared it with my nieces was because, so my niece posted a picture on Instagram that said something like she wants to be the first millionaire in her family. And I was like, what? The second? Like, I don't know what you think I'm out here doing. And I literally texted her and I said, I'm sorry. And I screen captured, you know, what she posted. And I said out here doing. And I literally texted her and I said, I'm sorry. And I screen captured what she'd posted. And I said, the second. And she texted me back laughing. And I called her and I said, I'm not having this conversation with you to brag, which I think she knew. But you need to know what I earn, how I got there, what I do, how I save my money, what I'm investing in, things like that.

I said, it's clear to me I need to be more transparent with you because you think that you're going to be the first millionaire in this family. And I am telling you, you are woefully mistaken, ma'am. It's really interesting because it used to be that, well, I think it still is, that your compensation was sort of the yardstick by which you were measured sort of out there in the world. And you're turning it into a teaching tool and a coaching tool. That's a real change. Because I think it is. And I think particularly for women, you know, I live at the intersection of black and female. And I think in both of those realms and spaces, it's important that we teach wealth, that we understand that our worth is not just in the money that we're making, but how we can use that to make other people, other communities better as a result of it. And in part, I can do that through wealth accumulation.

And transparency. Absolutely. So you are a public advocate for equal pay for women. Yes. Walk us through how this kind of transparency fits into your advocacy and how you think about this. It's not just the way you share, but the way people share with one another.

Is that a way of furthering the cause? I think so. I think demystifying money is a way to build more equity between genders. So I want to demystify it. I want to take the shame off of money. I want to take the mystique out of it. And I want women in particular, women of color very specifically, to use it as a tool for betterment. So if you're sharing the information, let's say I'm sharing with some of my colleagues, and it turns out that I earn more, substantially more, I would worry about putting a damper on their enthusiasm for their work and their engagement that, you know, it wouldn't just be awkward. It would be demotivating.

Is that what do you think of that? I think that's a possibility. But I think when you have information, you have to remember that that's all you have is information and not a narrative. And so how do I use that information to create the right narrative? So if you and I are colleagues, Amy, and you make $20,000 more than I do, that is all I know. And so I need to be careful not to create a narrative that may or may not be true. And so if I were to have questions about that, if we're colleagues and I have questions about that for my manager or for HR or for my CEO, whoever that might be, I would start my questions about myself. What's my pay band? How am I performing? What's the range? I have a lot of questions about me before I get to the point of Amy makes more money than me. I might use that information to spark me to have a

conversation, but my conversation isn't about judge me against you. Judge me against what I should be getting based on my value and my outputs in my role today. So, you know, you are an HR leader. Does it make you even a little bit nervous, the idea that people tend to place values on different things in a hiring and negotiating their salary and their pay. Example, when I took this last role, I really highly value my time away. And so I asked for more vacation time. I didn't ask for more pay in my negotiation. A colleague, a peer, may really value their pay more, their money more than they value their time away and may have asked for more pay. So it would not make me uncomfortable to know that I have a peer who makes more money than I do because I got

the thing that means more to me. And so why am I saying that? Because when we share that out of context, if I'm sitting with my peer and she shares her salary and I share mine and she's making more than me, without the context of understanding what happened in that negotiation, I then could use that again. My theme is information is information, not a narrative. I then form a whole narrative around that,

that maybe my manager likes her better because she's fill in the blank, whatever it is. When really I have placed a value on something that means more to me. So have you ever found yourself in a situation where an employee has clearly anchored her salary request in information she got from another employee. Have you ever been there? And how does that affect the way you approach the negotiation? Yes. The challenge in the particular situation that I'm thinking of is that the employee that came to me didn't actually have accurate information, but believed the employee that had told her how much they were making. And I happened to know that that was not how much that employee was making.

So what'd you do? So, you know, I have to to be really transparent with her about the band, about where she was in the band, about her performance, about what the next steps were. Like I had to keep that conversation completely focused on her. And what I could say was everyone on this team is within this band. Everyone that you work with is within this band, which was a true statement. But I could not say the person that you're talking to actually didn't tell you the truth. But what I had going for me in that conversation was, as a leader, I believe I had earned the trust of the people that worked for me. And that I would not lie, but I also would not share something that was confidential about her with anyone else. So I think it probably was not the most fulfilling conversation for that employee in that if she believed what she had heard.

But where we got to in that conversation was about trust and trust between the two of us, that I was being honest with her. Everyone was in the pay band. She was well situated within the pay band. We continued to move her through the pay band and continued to set her up for her own promotion or to do the thing that she wanted to do next. And so we had to have that level of trust, though. If we hadn't had that, if for whatever reason that employee had not trusted me, I think that would have gone a completely different way. Let me ask you what you say to women whom you mentor

when they find out about a pay disparity. How do you coach them? The first thing I tell them is to do nothing. Like, go to whatever your vice is. Pine of Haagen-Dazs for me, glass of wine for somebody else. Like, don't make up a narrative. Start getting the information and start knowing why you want it and what you're going to do with it. Go, you know, if you have trust with other peers, go to them. If you have trust with, you know, a mentor, another mentor inside your organization or someone that can help you get the information you need, go to them. Get the information.

Go to external sites. Get the information that you need. Make a compelling case for yourself and see where that lands. And then make choices based on that. If it's not the company for you, if they won't be transparent about your pay ban, if you don't feel like you're getting the accurate information, if you feel like you're getting pit against other employees or they're upset with you because you've had this conversation, the problem there is not you if that's the case the problem is them how do you get that information

though you know you're you're very you really believe in equipping yourself with as much information as possible before forming your perspective and then you know marching forth with it but what about the the more sensitive conversations that you might have with a mentor or with a colleague? I mean, it's a weird question to ask if it's not part of the conversation normally. If you have a mentor and you're not talking about pay, I don't know what you guys are talking about. I don't know how to have a conversation with the people that I mentor and not. I'm talking about mentees, with my mentees, comprehensively. And your pay is one of those things, a component of what makes

you up. So we are having that conversation. Well, I think you're a pretty extraordinary mentor. I don't know that that's true, Amy. I don't think that's true. I think that's a part of a normal conversation. But what if it's not? What if it's not? What if I go to my mentor and we have been too polite to discuss compensation? How do I bring it up? Get unpolite. This is your life you're talking about.

I don't even know how to say that nicer. Like, get unpolite. The point of mentorship is not politeness. The point is growth and development. What about with colleagues, with peers? How do you have the conversation with people with whom you probably never discuss salary? Yeah, I would say that requires trust. If you don't have a trusted relationship with your peers in that way, and maybe you don't with all of them and you do with some, then have the conversation with the some. Don't expect, and I have not had this happen to me, but I can't imagine someone that I know only in a tertiary way, only from sitting across this person in meetings or meeting at the water cooler asking me how much money I make. Like, I don't even know how to describe to you the look on my face you're going to get if you ask me that. I can imagine. You don't, we don't know each, and I don't know what you're going to do with the information. But if a peer of mine that I have established trust with says, hey, I'm really trying to grow

my career. I really want to do this next thing, whatever. And I really want to understand how I can get there. But I'm clear that the narrative is about them and not me. Because everybody's not your ally. And again, as I sit at the intersection of Black and female, everybody's not my ally. So I am going to be careful with whom I share that information. So it's really trust and people whom you trust enough to bring up a ticklish topic like compensation, right?

Absolutely. We are not having this conversation if we have not established trust. Okay. Well, you've given us an awful lot to think about, and I'm so grateful to you for all of your wise counsel on a topic that, you know, still makes a lot of us squirm a little bit. No, I'm super happy to help. I understand why it's, you know, squirmish in a way, but that demystification has to happen. Otherwise, we're just not going to grow. Yeah, that makes so much sense. Well, thanks again, Amelia. Oh my gosh. Thank you so much for having me. I really enjoyed our conversation. Me too.

What does the future hold for business? Can someone please invent a crystal ball? Until then, over 40,000 businesses have future-proofed their business with NetSuite by Oracle, the number one cloud ERP, bringing accounting, financial management, inventory, and HR into one platform. With real-time insights and forecasting, you're able to peer into the future and seize new opportunities. Download the CFO's Guide to AI and Machine Learning for free at netsuite.com slash women at work. That's netsuite.com slash women at work. All right, I'm curious. Has either of you ever shared your salary information? Yes. I have shared salary information with a couple of colleagues and with some friends.

Did they ask you, Nicole, or did you volunteer it? I volunteered it. I guess I was trying to start a conversation about our salaries. I was curious about what they were making. And I was wondering, I wanted to get a better sense if I was being paid fairly. So I was trying to start a conversation. I kind of put my salary out in the open. These are people that I really trust, obviously. And yeah, I use that to kind of kick us off. Were you clear with them that that was your purpose? Yes. Yeah. I think, you know, it came out of a longer, we were talking about how we were feeling around pay and compensation and concerns we have. Like I find that we have so many concerns about how much we make. And a lot of that concern just comes from not having a ton of information. Like we don't know how much we make relative to other people. If you're not like me, you know, in a managerial role, you don't really know your corporate, your company's pay scales.

There's just so much murkiness. Like a lot about pay has been a black box. So, you know, we have those conversations to try to get more information out there on the table so we could just check how we felt about things and whether that was close to the reality. I'm so impressed because I when I was at the point you are in your career, I was so ignorant about this. I just assumed pay was fair. Oh, my God. I know. Isn't that horrible? And I

never, okay, you can laugh a little less. That's adorable. I know. Well, I just was like, I assume we're all being paid the same. Yeah. And I never, it wasn't till, I think it was like my third job where I was like, oh wait, maybe that that guy it was a guy in particular is being paid more than I am and I've definitely shared with colleagues it was co-workers who I considered friends um I've also shared my family all knows what I make and my close friends know what I make but um I haven't done it with the same purpose you have, Nicole. Have you, Amy? No. I never have.

I have found out what peers were making. I remember once someone in HR had left a document on the copying machine. Oh, yeah. Classic. Yeah, it was totally classic. Or that's what we heard was that it was someone left it there. What happened afterwards was explosive. Was it? Yeah. But I'm going back quite a few years. I feel like that's, I've heard that story of like someone left it open or I saw a file on someone's desk and I just opened it.

And I feel like in a way that would be an easier way to find out what other people make. Like that is my dream. I would love if that happened. But I've heard from bosses that that is their absolute worst nightmare. Oh, it's, yeah. Yeah. It just, yeah. Why is it a nightmare? Tell us why it was explosive and why it's a nightmare. Well, so it was explosive way back when because, you know, there was all kinds of inequity and the guys were definitely being paid more than the women.

They also had bigger titles, but weren't doing bigger work. I mean, it was really bad. The reason it's a nightmare is that, you know, there is, you know, kind of scope and span of control and all of that stuff. But the other thing that goes into it is your negotiating skill coming in. Yeah. Nicole, you said it's your dream to just find out by the file. Why? Why don't you want to?

It sounds like you've had the conversation. Is it just that the conversation is so awkward? It's awkward and it's with, you know, just a few people, like literally a handful of people who I really trust and who have opened up to me and we've been able to have really hard conversations. bucket overall of what of the larger organization. And I think I'd be curious to know how much I don't know, after some of the interviews that we've done and listening to your conversations with with guests, I'm really on the fence about how much I think salary disclosure is a good thing and is necessary because, you know, we've learned that it can have so many negative effects as well. Like there's a real impact on you from finding out what co-workers make, if that is more, if that's less than you. It affects how you think about work. It affects your motivation.

But I think I would have loved more information about salary for myself, for the positions around me, for positions, you know, that I'm aspiring to. I think that would just have helped in terms of my negotiation skill and salary negotiation experts talk about is the the information inequity in these conversations is huge. Yeah. And Amelia's really was really clear about that, that you really that you have to do the legwork. Right. You have to do everything you can do to gather as much data as you can gather. Yeah. But I agree, Nicole. The conversation's hard. And I think since we've been working on this show, I've been thinking a lot about why this conversation is so hard for me and what, like, one of the things I often, when I'm anxious about something, I'm like, what am I really worried will happen?

And so why does this when I think about what's going to really happen if people knew what I made and really nothing like would we really treat one another differently if we knew how much everyone made yeah yeah and I'm not sure about that but I do think that the gut punch of finding out that you're being paid way less than someone you consider to be your peer is a lot to get over. But wouldn't you rather have the gut punch and the information than not know? Oh, yeah, yeah, yeah. And I mean, I also want to, I want, I want to be well equipped to have the conversation with my manager and with HR. Right. What I don't want to do is say, you know conversation with my manager and with HR. Right.

What I don't want to do is say, you know, listen, I'm doing more work than this person over here. I don't want to get into that. But Amelia made this point that you don't make the argument. You don't pitch the argument in terms of you. It's not I feel. Right. It's here's why this is right for the organization. Yeah. And I've actually I've used that tactic.

So I sometimes get paid to speak. And I once was being hired to, you know, for an event. And I was talking to the organizer and she asked me what my rate was. And I said, you know, before I give you my rate, I just want to tell you I once heard about the story, which is the story I shared with Gabby about, you know, a woman who showed up at an event and found out the men. So I just want to be paid fairly. And she said, thank you for saying that. And she said, here's what we're paying the other speakers. She was very transparent about it. And I said, okay,

I'd like to be paid the highest. And she said, okay, we can do that. And it was, I mean, it was one of those ideal and it just but it i appealed to her sense of fairness which is i think what amelia was talking about is that i want to be paid fairly well i also think that a lot of times the person who's asking you the question you know the woman you are speaking to about your gig probably just wanted the rationale yeah right for settling on a good number for you. Yeah. And she had a budget. I knew she had constraints, but I didn't want to get into that situation where I named a number that was either much lower than what other people were being paid, particularly men. And I didn't want to go way up in a way that she was like,

what's going on? That doesn't make any sense. You wanted to be in line. Exactly. But you also want the extra yard, which I love, which is I want to be paid on the highest end. Yeah. Good for you.

Totally stealing that. Yeah. Well, and I do think, I think it's something I've been thinking about how to help our listeners think about these salary negotiations. And I think especially for women who we know from the research get penalized for negotiating salary because it doesn't align with our gender stereotypes about what women should do. Is that appealing to people's fairness could be a good tactic. Yeah. And the other thing, you know, I go back to negotiating the initial salary because it really starts there. You got to ask yourself with, you know, given the data you have, is this a job you want to do for what you consider to be too low a salary? And you got to remember, you're not going to make it up. Right.

Because it's all incremental. Right. After that. Yeah. And it is, you have to start as high as you can get. And what's, and the thing that I keep going back to is, you know, what's the worst that happens if you ask for a high number? Yeah.

They come back to you and say, no, we can't do that. Right. And then you get, here's our number. Yeah. But how would you, just to go back to what you had said, when you are negotiating with an employer and you shouldn't make a conversation about pay all about you, you work this hard,

you work harder than so-and-so, so you should be paid more and you want to make it about the organization. How do you make that case when, or if you find out that a male colleague is making more than you? I feel like you can go in and say, you know, this should be fair. But I'm just curious what you think of that, how effective of an argument that would be. Well, I'm going to think out loud here, but I would say, you know, Bob and I do exactly the same job and it is absolutely not right that Bob is getting paid an awful lot more than I. What I wouldn't say is I work harder than Bob. Right.

There's a difference there. You don't want to, you know, you don't, you don't want to swoop and poop all over Bob. Poor Bob. I think you could also say, you know, I know we all want to work in a place that's fair. And Bob and I do the same job. It seems fair that he and I would be paid the same. So rather than I, I think the difficulty is when we start making demands, that's when we start playing into what we see in the research is that we get penalized for doing that. But if we say if we appeal to the greater good of like this is what we all want.

Right. Let's just make it happen already, people. Right. Right. I completely agree in this. And particularly with when the conversation seems misaligned with the culture, because all organizations are now talking about their culture and they all want to be proud of their culture. And if there's a culture of open-mindedness and fairness and you're running into the brick wall, then you can, I would, I would invoke that. Yeah. You know, I want to go to something Amelia said, which was about the mentorship

conversation where she kind of took me by surprise when she said that she talks about pay. To her mentees. Yes. Yeah. And when I kind of queried that, she said, well, any mentor who isn't doing that isn't doing the job. Right. And every mentor listening to this episode felt shamed, I'm sure, by that. Oh, yeah. I shrank into my seat. Has any mentor ever talked to you about salary? Never. What about you, Nicole? Yes. Oh, good. But it was me bringing it up and just saying, it was me being really upset and saying, like, is this fair? And then having a conversation, you know, being talked down a little bit. That was really helpful. Right.

And did your mentors share what they make? Or was it more general? They shared what they made when they were in my role. I see. Yeah. So I found it was at a time when I was really just like, I had little information. I was trying to, the little information I had was not super positive.

And so I was just, I was upset by that and I was looking for more information. And she kind of helped me get a better sense of what I should have been upset about, what I didn't need to be upset about, and just gave me more information. And that really, that helped me, you know, develop a plan for what I was going to do about this, which I found really useful and much better than kind of sitting and like stewing in all my thoughts about whether I was being paid unfairly. So you got context that you needed. Yes.

Yeah. I mean, sometimes the context can help. Sometimes it does. Yes. Sometimes it makes it worse. But I do think what you just said, Nicole, about it, you just had more information. And I think if we could think about this as information rather than our value. I agree with you 110%. And if there's one thing we heard from all of our conversations,

it's that you have to strip the emotion out of it. You have to strip it out in trying to understand it, this information you're getting, and you have to strip the emotion out in order to advocate for yourself. So hard. So hard. But a friend can help you. A manager can help you. And I actually think for our male listeners, tell your female colleagues what you make.

And it may be a gut punch. It may feel awful. But I think that is one of the best ways to close the gap is to start sharing, you know, across lines that are typically where we see the biggest disparities. So, Amy G, should guys reveal their salaries with the same kind of purpose that we suggest women do? Yeah, I mean, I think they need to be held to the same standard. And the purpose is to support your female colleagues in getting what they're paid fairly for. So yeah, they definitely need to, I think the purpose, you know, you don't have to like throw your W-2 around the office. But I think you can, if you're interested in creating a fair, just place to work, which I hope you all are.

I think, you know, you should share it, particularly if you're mentoring a woman, particularly if there's a close colleague who you're concerned maybe isn't being paid fairly. Yeah, I think we all have a responsibility to do that. And if you are in a privileged position where you think you are being paid, you know, more in a way that's unfair, wouldn't you want to take action on that. But I would just add to, you know, knowing how emotional this can be and knowing like if you really suspect that a colleague is making less than you as being unfairly paid, if you're being paid unfairly more than they are, like that is a gut punch realization to them. And I think you have to make room for those emotions and questions when you have that conversation, even just kind of like asking, are you ready? Do you want to have this conversation? So it's more on their terms. That's a good point, right? You don't need to walk up to your female colleagues

and say, here's what I make. Best of luck. I see that backfiring maybe a little bit. It would almost be better if you said, I listened to this great episode of Women at Work podcast, and I'm really interested in pay equity. So I'm going to tell you how much I make. Would you tell me how much you make? Right. That can be the interest in being equitable. You don't have to sense necessarily that someone makes less than you. Yeah. I also think the conversation is going to come up because it's in the wind. It is in the wind. And thankfully. And transparency is the

order of the day. So yeah, I think it's going to come up anyway. So you have to prepare yourself for hearing that. I mean, hearing that you make way more than someone you consider your peer isn't, I imagine, a great feeling either. You know, you really, you have to, as Nicole was saying, I think taking care of each other in this conversation is incredibly important. And, I mean, you have to be prepared, too, for, like, it's not, it's a long road. If you find out some information that you really don't like and you bring that to your manager, you bring that to HR, I think in a lot of cases the response you get will not be like, oh, you're right. We're paying you unfairly. We're going to correct that right away. I think it's like, no, there are a bunch of reasons that go into your compensation, like experience, like X, Y, Z. And you kind of have to think through what you might hear back from your manager, from your company, and be prepared to address those things.

Yeah. I think sometimes you just have to ask a lot of questions. Yes. What are our salary bands? Why am I in that band? Why am I in that band? Totally. Yeah. Absolutely. Where do these numbers come from? How do we compare to our competitors, right? I almost would say this is a series of conversations in which the first is you just ask a ton of questions. You reflect on those. You gather other information.

Then you come back and you can make your argument. Because the information asymmetry is so stark that you're negotiating into sort of a black hole because you don't know. You don't know where those numbers come from. We all agree. All of our experts agree. Having information is important to negotiating a salary. And yet we're all so afraid to share that information. And I think that gap between what we know works and what we're currently doing needs to close.

All right. I'm going to go tell a few people what I make. Okay. I'm not. That's our show. I'm Nicole Torres. I'm Amy Bernstein. And I'm Amy Gallo. Our editorial and production team is Amanda Kersey, Maureen Hoke, Adam Buchholz, Mary Du, Rob Eckhart, Erica Truxler, and J.M. Olajars. We want to hear from you. If you have any thoughts you'd like to share on this episode or really any episode we've done, email us at womenatwork at hbr.org. One last thing, please subscribe to our Women at Work newsletter. It is the best place to keep up with all of the research on gender that we're publishing, and it is where we reach out to you and ask for your stories and experiences,

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