Transparency Goes Beyond Pay with Tauseef Rahman

Tauseef Rahman: Organizations will say that they have a philosophy of doing x. Then I say, well, what about a situation like this? Then I hear a lot of well.

Right. And that's that's the stuff that erodes trust.

Janine Ramirez: It is my absolute pleasure to introduce Tauseef Rahman, a full stack workforce consultant with over fifteen years of experience. He currently serves as the growth leader of Mercer's career practice in Northern California and Hawaii and his expertise these lies in helping organizations attract retain and engage their talent to achieve their best performance. So his work covers a range of areas including job and work design, rewards, workforce analytics, technology enablement and transformation.

But today on the podcast, we will be discussing an important and timely topic which is pay transparency. So they'll see if it's been sharing insights online and we saw this and we wanna like pick his brain on it. So we want to know how to effectively talk about pay and the importance of transparency in creating a healthy work culture. So Let's dive right into the conversation with Tousif Raman.

Welcome to the podcast, and thank you for joining us.

Tauseef Rahman: Yeah. Happy to. Thanks, Janine.

Janine Ramirez: We're we're so interested in this because it's the talk of the town. So let's let's dive in. Like -- Sure. -- there are legal obligations now for pay transparency.

Why embrace pay transparency?

Janine Ramirez: But why do you believe that organizations should embrace pay transparency apart from compliance?

Tauseef Rahman: Yeah. This is a great question and we get this a lot, right? So is it a compliance topic or as an employee engagement topic. And certainly it's a bit of both. You want to comply. I'm not gonna say not to do that.

But it's you're kind of losing the point by doing by doing that by only focusing on the compliance side. The the reason organizations that embrace it is it's because of employee and candidate expectations like put simply.

We do research on this and see various forms of survey data on this eighty percent of employees say they want pay transparency, fifty percent of employees candidates won't apply for a job without it. Wow. I compare them anecdotes later on kind of what that means for what we've been seeing with some clients in terms of how they'd have to respond.

There's some benefits, right, to come along with this.

It's it's having a more compelling value proposition for employees.

And I will comment that, you know, for organizations that need to continue to attract and differentiate themselves in the market.

This is one of the kind of top current ways to to to do that.

Janine Ramirez: Right. If they don't, they'll be left behind. Right? I mean, Yes. A little bit. Right?

Tauseef Rahman: And a little bit and then conversely, and we can chat about this, you know, when it makes sense. There's an element of either left behind or they they'll they'll have to catch up. Right? You know, in terms of other organizations setting the pace on this, And being left behind is one thing if you're okay with being left behind, but but when you're not okay with it, then you actually have to catch up.

And there's a lot of way to catch up on this.

Okay. So let's get to the work.

Misconceptions on Pay Transparency

Janine Ramirez: But before that, like common misconceptions for people that are reading about this, what are the common misconceptions on pageants' guarantee and how do you adjust them?

Tauseef Rahman: Sure. So I think the most common one or maybe a common one is that it's about sharing what other people make. And it's not about that. It's not about publishing or saying that Steve gets paid x, and Janine gets paid y, someone still gets paid paid z.

It's caring about what the pay range is for the role. Right? If you're either applying it for it, for some places and some organizations, considering what the pay is for the job that you're already in.

And more importantly, it's not just what it is. It's not saying we pay between A and B for job C.

It's staring how you're paid for it, why you're paid for it, how will people continue to progress through it. So it's it's it's a little bit more It's a lot more complex.

Yeah. I was gonna use the word complex. It's a lot more than just saying, here's the range for the job. Right, right.

So there's a lot of thought that goes into it. I mean, you also have to think of how to communicate it. You should give context Because if not then, I mean, people can, you know, take it out of context and like use it. Right?

Yeah. Against each other. Well, yeah. And and and and it's more of, you know, you're providing a piece of and the the the joke I I I like to make is that if you see a pay range on a job both or your manager tells you the pay range for the stub.

That's step seventeen in a series of events that have happened to get you to that point. And I'm not saying there's exactly sixteen steps, but along the way, you figured out what's the level of the job? Is it in accounting or an IT? What's the geographic location of this job.

Right? Many things need to be determined to set a, you know, range of pay for the job, what's the business environment, what's the business context. And so hitting to for job x, we pay you know, eighty to a hundred thousand without providing you can't provide all the context. There's not not enough time in the world.

Without providing none of that context of how to how that that got determined? I think that's that's really the challenge.

Janine Ramirez: So it's, I mean, it's a lot of communication work, right? And structuring and communicating, just like, until what point are we going to talk about the context of this certain role and how it got to that salary point.

Tauseef Rahman: Absolutely. The other other talking point I like to use is that when you think of paid transparency, people think about It's about paid strategy and a bit of, you know, some communication.

I say it is at most forty nine percent about pay strategy and at least fifty one percent about communication.

Right? And I talk to people, they're like, oh, yeah. This is thirty percent about the pay and seventy percent about, like, how we communicate it. So I I I just I just give that comment of at most it's forty nine percent about the comp. It's you need both. It's not zero percent about the comp. You need to have that that that that well well understood and rationalized, but it's not it's not a zero percent comms exercise.

Janine Ramirez: Okay. I think we'll we'll talk a lot about the communications later on. But

Pay Strategies for Remote Organizations

one other thing that complicates you know, structuring pay in the strategy is that now people are working from anywhere they want to in the world.

Sure. Sure. Remote working. So, like, with that comes different varying costs of living. So how has the shift to remote work impacted? Like, compensation structures, and what are some strategies that companies can adopt to ensure that it's fair and transparent when it comes to pay practices?

Tauseef Rahman: Sure. Yeah. And and and and it's it's it's a great question because I think organizations have largely I would say been silent, but has it had a good story about what they pay for as it relates to geography?

Mhmm. Is it cost of living?

Is it cost of labor?

Is it both?

Do we care about the labor market? Or do we care about the value of the work being produced no matter where it is. Like, these are very important questions, and I I jokingly think that I think a lot of organizations say, yes, is the answer to everything. But that's not possible. Right? The answer to us, having questions can't all be yes. Right.

So to your your to your questions, Janine. Right? Like, how has it evolved? It's actually it's not so much the evolution of practices, certainly some of that that's happened, which I can talk about.

Organizations just have to get actually clear and answer the question.

In terms of what do we pay for a job in location one versus location two, and what is driving the difference?

And is this something that differs between organizations? Like, they have to decide what they value more or do you have an answer? Like, it should be done, that's No, no, no, great question. I certainly have perspectives, but if all going to be based off of what the organization values. Right? So does the organization want to pay for local cost of labor in different parts and basically acknowledge the fact that the supply and demand of talent in one geography is different from another, or does an organization want to say, we will pay the same thing globally for all types of you know, for for all of the similar type of work.

It's it's a spectrum there are certainly pros and cons to where you are on that spectrum. But more importantly, it's a where are you on that spectrum?

Why are you where you are on that spectrum?

And are you prepared as an organization to continue to stick to that answer?

And not do it on a case by case, you know, ding ding your answer on a case by case basis. That's that's, I think, the hardest part because Organizations will say that they have a philosophy view of doing x. Then I say, well, what about a situation like this? Then I hear a lot of well.

Well, what about the situation why? Well, if it goes to life circumstance, right.

Right. That's the stuff that erodes trust. Right? And makes it difficult to have a clear or clear story.

Geographic Pay Nuances

Janine Ramirez: But it I guess it also depends on, like, where the people are in the world. Right? Like if if they're geographically in places that are more or less like similar in terms of base structures on how much people get paid for a certain type of work, then it isn't so much of a problem. But the more diverse than the more difficult it is to answer.

Tauseef Rahman: It is. It is. There's a geographic difference. And we could talk about, you know, an example, even with any country, pick pick any country, the UK, France, Canada, wherever, geographic pay differences are more nuanced than people care to admit.

The cost of labor doesn't vary the same way for all types of jobs. And what I mean by that is we've seen in some research that I've done that tech jobs, you know, if you look at national data, how all job pay differently from one location to another, let's say there's a twenty percent difference between a, you know, location a and b. But when we look at software engineering jobs, it might be a minus ten percent difference. When we look at an accounting job, it actually might be a minus twenty five percent difference.

Because the whole idea is that when you talk about national differences in cost of labor, those are all averages that bundle in a lot of things. And the reality is it really depends on the type of work that you're in. And as you can imagine, depending on the local or national supply demand for talent, the cost of labor can vary. So to being very clear, I'll give you an example.

Right? We say, well, we pay twenty percent less outside of LA you know, San Francisco, New York. That sounds nice to say. Right?

Sounds very clean and simple to say. Mhmm. But that's not the reality of how software engineering jobs are paid outside of San Francisco, New York. Right?

There it's not that, for example, twenty percent.

Right? So are you going to pay are you gonna be less competitive in certain jobs? Because you wanna come up you wanna have a simple talking point.

Or do you want to kind of be closer to reality?

And then have a more complex stop points that people will understand when you explain it to them, but it requires more explanation.

Does pay transparency open up debate?

Janine Ramirez: Pay transparency is opening up so many, like, new debates so right? And there was something like, why should people get paid that much in this industry or for this job both versus another like what are some topic debates that come to mind that you've seen from from pay transparency?

Opening up that box, the Pandora's box.

Tauseef Rahman: Yeah, you know what affairs, I think there has been When I've talked to kind of other co reporters and other folks, I think there is this concern People will I don't know how magically find out something about how a jobs pay that they had zero clue about in their life. And maybe I give our society a little bit more credit, right, for those, like, spend, you know, all of thirty seconds on the Internet.

Whether it's purely for what that company does or not, like, I don't think the information is that unclear.

Right. That's that's true. In general. Right. Right? Is is an Internet search gonna give you the accurate number absolutely not?

Will it kind of give you a sense of this job pays x or y? Yeah. Probably.

So I think it's if this I think we've moved so quickly past paid secrecy as a society that our knee jerk reactions haven't caught up to the reality of the world as people. Oh, but aren't you scared that this nothing oh, not.

Right. I well and and I You've been exposed to that. I've been exposed to I've been talking this for the last, like, five, seven years. So I'm just like, So if you're asking me -- Right.

-- like, the day the the the data are out there. Right? Like, if Then maybe it's more about like how it's being communicated do. I mean in the news and within organizations.

Where I see the issue.

No-nos When Talking About Pay

Janine Ramirez: Right. So what do you see companies struggling with when it comes to talking about pay and compensation. Like what are the no nos and, like, what are the must dos?

Tauseef Rahman: Yeah. So so there's I mentioned a couple things. I'd say the simplest no no is not to treat this like a compliance section.

Right? I I think that is the worst thing organizations can do. Eats at employee value proposition topic. It requires real consideration alignments to business goals, And I think I think that's, you know, a no-no. I also think there are some organization from a no-no, like you said, they say 'this doesn't apply to me'. I don't have a law in my, you know, region that requires me to have it. Great.

It all doesn't matter or they haven't realized it yet, that it doesn't matter whether there's a law there or not.

Other organizations will voluntary share this in voluntarily share this information, and they'll have to figure out whether they wanna be competitive or not or not. Right? So no no company is an island and immune to this. And to be clear, I'm not saying organizations need to, but just let's go through the thought exercise.

When employees ask, hey, our competitor shares this info and we don't. Why?

You just have to have an answer to that. And what I'm saying is that you'd you know, you need to do with the you know, what other people are doing saying, You can't ignore the question. You actually need to come up with an answer to these questions. Even if you choose to do the bare minimum, like we have I work with financial organizations that you do that and said, hey, great. I get it and actually makes business sense. You don't, you know, you don't have the infrastructure in place. You don't have the job architectures.

Totally fine. What's the story of how we're gonna say that that's that's -- Right. -- not what we're gonna do because no period, you know, is not is not it's not a valid response. Right.

Janine Ramirez: Like what you mentioned earlier, we have to give, like, the public and the employees the benefit of the doubt that they are aware. So if they ask why you can't just be like, because that's how it is. They're gonna wanna no one answer.

Tauseef Rahman: And if not, they're gonna be like, oh, okay.

Or they're gonna be like, oh, okay. I'm out of here. Right? It's gonna be one of two -- Right.

-- big things. So Right.

Janine Ramirez: It almost sounds like it's another test for organizations to figure out what their values really are and stick to it.

I mean, there there was a lot of that, like, after the pandemic. Okay. Like, we care about our employees. Now we have to invest in well-being and wellness.

Are you actually gonna put the money out for that? Or for DEI and now it's like, patrons'parency. Do you do you really like does it align with your values or not? And are you seeing -- Yeah.

-- most organizations are like happy to do this?

Tauseef Rahman: It's it's honestly half half. I'll say. Right? So there's, you know, half of organizations are very much thing.

Yep. We're already doing it. We're going that we have a plan. We're we're executing on it, half you know, and and or we're exploring it. Another especially, let's just have, I want to say, like, something like forty percent are saying we are doing with the minimum that's required and we have no plans to go further. So it's a mix it's a mix.

How to Communicate Compensation

Janine Ramirez: And how would you like, what are some tips or steps that organizations should take to communicate this properly and effectively?

Tauseef Rahman: Yeah, so I think it's really important think about the whole end to end experience, meaning how is it communicated for candidates upfront as part of the TA process, how is it communicated, you know, to employees while they're there.

What is it up what you you'd mentioned we'd mentioned in our conversation contact how is the context communicated of what the level of the job is, what type of work it's doing, how you how the organization has been paid for different, you know, different work in different parts of the world or in the country. It's it's important to have that holistic view and more importantly tie it to the broader employee experience, pay equity, engagement, lend, as opposed to saying, as opposed to answering what I think people's the question which is the question is you need to tell people the range of paid. That's not the question.

Right. Need to explain people to people how did you come up with that range of pay? Why are you paid in that range of pay? And what can you do to move along in it?

Like, these are the questions people wanna know.

Janine Ramirez: It's almost like a like a commitment document. Right? Like, when it comes to pay, like, these are our rule and, you know, like what we've decided to move forward with and from that like, okay.

Each position earns this much for that. Exactly.

Tauseef Rahman: Yeah. Yeah. Yeah. Yeah. Yeah. I know we're gonna call it rules. I mean, there's always a need to flex, etcetera.

Opening the Can of Worms

You know, when I I I think the biggest challenge is and I can sympathize with organizations is that when being transparent on these topics that have largely been one off and not disclosed.

You didn't have to worry about whether it made sense. Like, whether decision three checks out against decision seven, you never have to think about that.

But that's over now.

Right. And that's where I think the anxiety is coming from.

Within can I have to have a reason why you do things now?

Janine Ramirez: I thought that's how if should have been from the beginning.

But I guess, organizations I mean, they're they're huge. So they can't necessarily I mean, maybe in the past, it's like we know this. Communication is an issue. Like team a has no idea how team b does things and now they kind of have to have they have to be tied together.

Right. Right.

Tauseef Rahman: Not nothing. Right? But the the percentage that's allowable of illogical decisions, like, that's gone down.

Alright.

Janine Ramirez: Okay. Let's talk about transparency. Okay? Not just pay transparency because I guess that that's at the core of this all.

From your experience, like how important is being transparent when it comes to boosting engagement, earning the trust of the workforce.

Tauseef Rahman: So lot lot of research kind of of our of our own. Otherwise, it shows that it's quite critical, right?

It drives so many things. It supports goals and I'd say not that that's unimportant, but there's an even simpler side to broader transparency and clarity is It's what helps organizations attract and retain candidates and employees.

Right? When we think about all the research that's been done over decades of what people you know, we ask people, do I understand how my pay is set? Low score. Right? Am I satisfied with this in a low score?

I believe I have a career here, this organization low score. I talked to these same clients like, do you share your, you know, career guide? No. Do you share how people can increase their pay? No. Right? Like, okay.

So you expect people to basically be unhappy about it. Right? You know what I mean? It's it's it's it's it's it's, like, being mad about something you put no effort into fixing.

Makes point. And and I say that at ten thirteen, you know, like, what talk about, like, it's not just pay. Right? It's what does a career here look like? Mhmm.

Alright. That is transparency.

Right.

Getting Over that Awkward Pay Conversation

Janine Ramirez: Like for me, for example, I try not to look at pay so much, you know, and it's like, okay, like am I being fulfilled in this job? Like, am I being challenged? Am I learning? Is there room for growth?

But to be completely honest, pay is really important. I mean, without the basis of that, you wouldn't be in the job that you're in. So -- Yeah. -- like in terms of transparency in general, talking about pay is actually really important and I honestly never even realized that.

It's always an awkward conversation. How can we get over that awkwardness you think?

Tauseef Rahman: That's a that's a good one.

How can we get over something that has been, you know, common

Janine Ramirez: I mean, people say don't talk about. Right? It's like, it's been really ingrained...

Tauseef Rahman: It's a very strange one to me.

Right? Like saying I don't... even in society, we've gone through these sorts of revolutionary, and I don't I think this is revolutionary changes of, like, how people view the world, like, the earth was flat. No. It's round.

Earth is at the center of our universe or the galaxy. No. It's the sun.

Right? Like and I think we need to be willing and open to conceiving of a world that changes.

Right? So I know that sounds very philosophical fine.

And if you want a practical way to get over it, it's you know, I'll just share with you a story from a client where they were like, yeah, we'll get to pay transparency later later. It's cool. It's cool.

Until their candidate pipeline just totally dried up. They didn't know why, and it's because their competitors for other types of roles were, you know, these are, you know, for you know, entry level roles, sharing the pay ranges, and they figured out that they have to do it. So they had to do it for remaining business.

Right. Right? So it's either going to be something where you get with the program -- Mhmm. -- or the program is gonna be given to you.

Janine Ramirez: And retention is so important. Getting the right talent is so important. This is way to attract.

Do you think it's going to Is it already like housekeeping levels like this has to be done you think in your in your perspective?

Tauseef Rahman: I I expect so I'll give I'll give another example. So I wanna say twenty sixteen seventeen.

There were they see that here here in California. There was salary history bans. Which was recruiters or the employee employer can ask the candidate what their prior pay history was. Oh my gosh. Janine, like, the how will recruiters do their job?

How will we do this? Like, it was just like how will life go on?

Right? Right?

People forgot that that wasn't a fuel.

Right? And sometimes it makes work more complex and challenging? Don't get me wrong. Right?

But I give it give it another two week two to four more years, I'd say we're kind of one year in to it. Right? You know, when I think about last year and certainly this year a lot of localities coming into play and then EU coming online and I want to say three years' time. I think that each country has three three years to put into effect.

We'll chat about this six years later, and this will be like nothing has happened -- Right. -- in in the evolution of how work gets done.

Janine Ramirez: I guess like any change, there's just that awkward period that we mentioned. That's like, how do we get this done? How do we do it right? And later on, we're gonna have, like, the best practices in place and it's gonna be norm.

Tauseef Rahman: And and the world moves quickly. Right? It If not long ago, where companies said, oh, and we've decided to globally stop asking for prior salary history. Right? And you're like, oh, okay. Good job. I'll give you two claps.

Right? Great.

And if a company says that now and, oh, now we've decided to... I'm like, oh, Where are we? I'd be late to the party. Would have you been there? Right?

This is not something to give yourself credit for. Yeah. It's not like welcome to the club, but it's just like the world has moved on. Right?

Right. You're not fully glad you're doing it. So glad you understand it needs time. But you can't take credit for it.

Right. You can't take credit for catching up.

Janine Ramirez: So get with the program, while it's while it's early.

Tauseef Rahman: Well, it's an opportunity to differentiate. And I don't think that every organization needs to do it, to be clear. Right?

I guess that a lot of our, you know, work. There's organizations, like, are gonna be doing and and that actually, I truly have, you know, clients and kind of friends who do this, so I'm, like, yeah, absolutely makes sense. You know? Yep. This is you're you're doing exactly and you have the story. I don't care what it is organization to do. They just have to have their Tory trade.

That that that's my biggest advice. Right. Right. Alright. You can choose to be like, no.

We're not gonna share pay range is openly my love for these reasons. Great. That's the four reasons parks that I care about. Right.

Janine Ramirez: The whys and have your story straight, your narrative, and everything aligned.

Right? Like -- Mhmm. -- we believe in this, as a company, as an organization, these are values. And therefore, Yeah.

Tauseef Rahman: We're not an organization that, you know, where we believe pay is an important part of why you want to, you know, stay and join its mission in the work we do.

You know, we can share this, you know, upon request.

You know, here are all the other things that are important to us in our like, that's a very logical and valid reason as to, like, hey, we're an organization that doesn't want to pay to be the main reason why people choose to stay or leave.

Well, you know, you can discuss it with your manager, but, no, we're not gonna blast it on on the Internet since we think that's another, I think. Fine.

Right? But there is, like, a coherent story as to, like, what Right.

Right. And and people confuse to agree whether or not, but you avoid a situation where there's a vacuum of information and people start creating stories around it. Like if someone's gonna tell the story about why a company does or doesn't do something, shouldn't it be the company?

Which sounds very simple.

Hope for the Future of Work

Janine Ramirez: Okay. I want to, like, wrap up because we don't wanna take too much of your time and I'd love to hear your thoughts. Just broad thoughts on the future of work and workplaces Like, what's your wish for the future of work?

Tauseef Rahman: So it's a great question. And I was chatting with this with a friend of mine yesterday.

And my wish, right, is that for practitioners in this workforce base, that they ask themselves a serious question, which is How much of what was designed today that we have was with the end goal of supporting employees or even the business.

As opposed to, the preferences of the people doing the design. And what I mean by that is and we're all guilty of it to be clear. Right.

If I'm gonna throw a party, I'm gonna throw the party I want.

Right? Versus It's your party.

Right. Right?

And it's hard to throw a party for other people, but then, like, then you don't And, like, yeah, let me just do what I you know, give me full entities.

And and so, yeah, I'll put this another way. You know, do we design HR for HR folks.

Right.

Or did we do it for the business?

Right? Mhmm. Forget the employees, and I don't mean that in a bad way. Right? Like, Did we do did HR do it for HR or did HR do it for the business?

And I think that's a real it's a very difficult question to answer.

And I and I think it's a very yeah. It's a very very tough one, and it's I know it's an off putting question, but it basically you know, in my mind, you know, I think that's the hope. Right? Which is how how much of the stuff that we've designed have really been for the benefit of employees?

Janine Ramirez: I mean, you study it, right? Like, you study it, you know more or less based on science, based on psychology, how you should put your people first, how to help them improve the way they work, how they can feel fulfilled.

Yeah. Are you putting it into practice, or are you just, you know, ticking boxes for for leadership, you mean?

Tauseef Rahman: And then and that's it. And it's it's I'll go back to that early piece of pay transparency.

It's okay if the answer is, like, Yep. I've designed this for ourself and our leadership because that's our plan. Mhmm. I'm good with that answer.

Right. Right? But from a hope is I really want HR practice nurse to be clear and not confuse that they're doing it for another group when they're really doing it for this other group. Right.

Right? I I'm doing it for group c.

Are you really doing it for group c or group b? I I don't care who you're doing it for. Just don't don't lie to yourself about who you're doing this for.

Janine Ramirez: It's funny because we had a team, some members of our team go to the unleash event and their favorite takeaway is that one of the the lines that they said was like HR now is a seat in the table and like the leadership table and they're not gonna give it up. And maybe Like, that's tied to what you're saying. It's like now finally, they have a voice in how the business is run. And that is how it should be and they do not wanna give it all.

So I think your hope is coming to life, Tauseef.

Tauseef Rahman: I I hope so too. Right?

Let's just, like, let's let's not waste that opportunity.

Great. Now we're in the is the with the seat of the table, Oh, we could now design things for the other people at the table.

Right? That's my hope. And organizations have been doing that too. I'm not saying it's everyone.

Right? But when I think about the employees' candidates and, like, organizations that are, you know, lagging behind in a little way? Like, that's my hope. Right?

That that work becomes something that is beneficial for all.

Right, for the organization, and the employee and society.

Right? And the way you do that is by the designing with all of those stakeholders in mind.

Janine Ramirez: And on that note, I think that's a lovely thing to reflect on for for our listeners. So We'll end with that. It was such an insightful episode and if anyone wants to talk more about patron's parent anything that we talked about today. I suggest you follow Tousif on Twitter and LinkedIn because like I've learned so much just by following him, like reading what he reads and his comments. So thank you so much for joining us today.

Tauseef Rahman: It was a pleasure No. Thanks for the chat, and I appreciate the opportunity.

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