A web search of “pay transparency” results in millions of hits, pay transparency or the extent to which employees can discuss and have access to compensation information, has emerged as a popular but controversial topic in the last few years. Although more common in America and Europe, a key question remains—should companies in Asia adopt this practice?
There is no simple answer. On the one hand, pay transparency is a potential solution to organisational issues such as fairness. On the other hand, pay transparency potentially creates more issues, including dissatisfaction and increased bargaining. Additional factors to consider include:
- whether employees prefer pay transparency;
- whether an effective performance measurement system is in place to justify each pay level; and
- Whether firms are prepared to re-negotiate with dissatisfied employees.
Much research is underway in the hopes of unravelling this black box.
Dr Leon Lam DBA, Vice President & General Manager, Merit Medical Asia Co. Ltd.
Dr Bonnie Hayden Cheng PhD, Associate Professor & MBA Program Director, HKU
Paul Arkwright
Publisher
