Disclaimer: The views and opinions expressed in this article are those of the authors and are not intended as legal or financial advice.
Does this look familiar?
For businessmen or law firm professionals, the number of disclaimers, italicized provisos, or policy clarifications read on an average day can’t be counted on a single hand.
Sadly, employees learn to ignore the fine print. But, when it comes to understanding (or writing) a productive employee manual, it’s time to put on your reading glasses and pay attention.
Consider the following sample section, “Confidentiality of Salary and Benefit Information.”
“Employees are prohibited from discussing their salary or wage levels and company benefits with other employees. Such information is confidential and may not be discussed in the workplace. Any employee violating this policy will be considered to have committed a breach of confidentiality and will be subject to disciplinary action, up to and possibly including termination of employment.”
Most employment contracts or manuals have similar language that’s embedded—somewhere—in type 8 font or smaller.
In fact, it’s likely that most associates already assume discussing and comparing salary and benefits packages among one another is against firm policy.
For now, the more important questions for employers and employees are (1) Why do employers feel this salary confidentiality clause is necessary? And (2) Why are employees tempted to violate it?
The first question is easy to answer. Employers must protect their competitive advantage.
If all wages, salaries, time cards, benefits packages, etc., are kept confidential, then employees are unable to leverage this information to their benefit, to–say–secure higher year-end bonuses.
“Well, if Bob put in less hours, won less cases, and contributed undeniably inferior work product this year, then why is he being paid more?”
Law firms would be hard pressed to address every issue involving salary comparison. Mostly because Bob is an equity partner’s son. Or, because Bob has some subtle skill unseen by other associates. Or, most likely, because Bob was hired years ago and provided a salary commensurate with better economic times.
Whatever the reason, employee financial information is best kept close to the (three-piece suit) vest.
The answer to the second question is more nuanced.
First, employees are apt to ask one another about salary and benefits numbers for the exact same reason as mentioned above—employees need leverage and perspective when negotiating higher financial packages with firm managers.
However, this is not the only reason for policy-violating discussions.
A second reason employees discuss salary and benefits with one another is because law firms rarely provide a safe space to ask about retirement, financial planning, childcare, or health benefits.
Sure, employees can call the insurance agents. Yes, employees are able to discuss retirement options with their supervisor. But, what about more sensitive topics, like the possibility of expanding medical coverage to mental health, or the average bonus for first-years?
At law firms, where women are already marginalized in top positions, female attorneys are not going to ask about their options post-pregnancy for fear firm managers are already writing them out of the partnership track.
To keep associates from discussing salary and benefits with one another, managers must provide a forum to do so—without threat of repercussion—within the firm.
So, here are a few ways to obtain a balanced competitive advantage between firm employers and employees:
- When it comes to rewarding performance or allocating bonuses, make sure employee evaluations are level, honest, and regular.
- Invite insurance representatives to the firm to speak about benefits. Organize small groups of similarly-ranked employees to attend at various times throughout the day. Individuals of similar ages will have similar questions and issues. Also, small groups will help employees feel more at ease to ask questions. Finally, make these round-table meetings mandatory.
- Create an anonymous feedback box where employees can request additional benefits or suggest ideas for office improvements. Ensure that this box is indeed kept anonymous.
- Implement suggested changes at least once a year to send the message to your employees that they are heard and respected.
- Whatever the method, newly hired, mid-career, and soon-to-retire employees should each be give an opportunity to ask controlversial questions about salary and benefits. The forum should be frequent and safe, i.e., without fear of reprisal or any assumption by the firm.
Don’t attach a disclaimer to the respect your firm gives its employees and its remuneration for their hard work.