What if knowing your colleagues’ salaries was a source of calm, instead of tension? Some companies made this bet several years ago, with success. And the others will soon have to start. A European directive on pay transparency must be transposed by June 2026.
This legislation will introduce a series of new obligations for companies. In particular, employees may request information on the average level of remuneration of their colleagues who perform the same work or work of equal value.
Some companies did not wait for this legislation to put their cards on the table. This is the case of Clinitex, a cleaning company. 10 years ago, on a Friday afternoon, the CEO decided to publish the salaries of all office employees on the intranet* (the company has no control over the remuneration of maintenance workers, which is set by the collective agreement and is therefore public).
“Equal pay for equal work”
“To do this you have to be convinced that there is general consistency in the salary scale; among us the policy was already ‘equal pay for equal work’, so I told myself that it was demonstrable,” says boss Edouard Pick. On Monday morning, two employees showed up at his office. “There were two discrepancies that were not justified and that had escaped us, which allowed us to rectify them directly,” he recalls. But apart from these two cases, the news was very well received by the staff.
Obviously, such transparency requires, in principle, having a clear and justifiable remuneration policy, that is, deciding the criteria on which salaries are based and communicating them. At Clinitex, the fixed salary rewards responsibility. Thus, an employee with 20 years of seniority has the same salary as a newcomer if he has the same responsibilities. Except that there is a seniority bonus, every 5 years, 10 years, etc.
“When there is a feeling of sincerity, it stops being a topic”
Despite some clarity, some cases raise problems. Clinitex bought a company that did not charge the same salaries. As a result, some employees were paid more than others. “We can’t do much about it, it is the result of history and time will do things to rebalance, that is, the salaries of others will recover,” continues Edouard Pick.
Another case was presented. The company had great difficulty recruiting an administrative manager and therefore had to offer a higher salary. “Everything has been explained to the employees. Every year, the remuneration committee explains the details of the remuneration and the report is available on the intranet,” he tells BFM Business.
“The charlatans demand increases”
In 2019, IT development consulting company Shodo decided to publish a detailed salary scale. Always accessible online, it lists positions and the corresponding salary according to the number of years of service. “At the time of this publication, some consultancies were ahead, so the following year they had no increase,” CEO Jonathan Salmona says simply.
But in the end the implementation of this system was beneficial, he says. “It takes away the mental burden from employees of knowing if their colleagues earn more, of knowing how they are going to ask for a raise, they focus on what is essential, that is, their work,” explains Jonathan Salmona, who has maintained a bonus system to reward performance. He claims to have managed to reduce turnover from 25% overall in the IT sector to 6% in Shodo. “Thanks to salary transparency we have great attraction: up to 70% of hiring is based on spontaneous applications,” he adds.
Half of employees willing to resign in case of injustice
Despite some tense moments, these business leaders report a positive experience. According to Sandrine Dorbes, compensation strategy specialist, companies should not delay tackling this project. Because it requires a lot of work upfront.
“First of all, we must establish a clear and explainable remuneration policy for employees. Then, we must take stock of the gaps and inequalities that could exist. This will raise technical problems, challenges in the classification of positions,” he lists to BFM Business. Finally, according to her, we must start as soon as possible to eliminate unjustifiable gaps.
At the risk of exposing yourself to legal consequences, but also to a bad image. According to a study by PageGroup France, 7 out of 10 employees consider that their employer is not transparent enough and more than half would be willing to leave their position if they perceived injustice.
* The Clinitex company publishes the names of employees and their salaries internally (with their consent). The European directive does not go that far. These are its main provisions:
• Employees may request and receive written information (disaggregated by sex) on the average salaries of their colleagues who perform “equal work or work of equal value.”
• From 2027, companies with more than 150 employees will be required to publish accurate reports on the pay gap between men and women. This obligation will be extended to companies that have between 100 and 149 employees in 2031. If this gap is greater than 5% and is not justified by objective and non-sexist criteria, the company will have to correct these inequalities.
• Companies must inform candidates before the first interview about the expected salary range for the position offered.
Source: BFM TV
