Discussion of Rates of pay by employees.

Bob Pettis · May 2002

It has a demoralizing and detremental effect when employees discuss their rate of pay with fellow employees. This is as a result of a number of reasons, e.g., they started at a lower rate of pay, they currently earn less, they believe they work harder, they believe their function is more important or in general, they simply do not approve of the wage the other person earns. This causes a very perplexing problem for management and one that could be avoided if employees were not allowed to discuss their rate of pay. It is my understanding that an employer is not allowed to prohibit an employee from revealing their wage, is that correct? If this is true what options would you suggest that an employer consider to reduce the effect this activity has on employees.

Thank you for your help.

Rockie · May 2002

First, I totally agree with you on the detrimental effect this can have on business, i.e., morale issues, budget issues, etc. When one group of employees gets something (for example, a market adjustment), every employee feels entitled to the same. Employees who are professional individuals do not discuss their salaries with other employees (as they should not discuss their personal business, but we know better!)

Unfortunately, this is considered a "protected" activity under the NLRA and I can't see where an employer could put any restrictons on employees discussing salary among themselves - what they make; the amount of their raise, etc).

I have seen companies who prohibit this type of discussion even going so far as to put it in their handbooks, but since employees now know they can freely and legally discuss these issues, they do.

Bob Pettis · May 2002

Thanks for your response. Does anyone have a reference that could be cited as a specific source of information that precludes employers from putting restrictions on employee discussions of their pay rates?

Don D · May 2002

Bob: We had a similar discussion the other day on another forum topic. Go to the Employment Law Questions area of the Forum and scroll down to the subject of "Salary Confidentiality". I think you'll see your answer there, unless you are looking for a citing of chapter and verse.

Gillian · May 2002

Check out California Labor Code 232. The title is Prohibition against requiring employee to refrain from disclosing amount of wages. It prohibits the discharge, discipline or discriminate against anyone who discloses their wage rate. From my experience trying to control discussions about pay is futile and generates more discussion - about what the organization must be hiding.

WT · May 2002

I am aware of a small employer in the area having a policy against disclosure of rates of pay. They did discipline an employee for disclosure and she ran to the NLRB. The Board came after this rather small employer on the basis of protected activity even though there was no union on site. To date, I do not know the end result but unless you have money and patience to spare, it is tough to take on the NLRB even if you eventually win.

Discussion of Rates of pay by employees.

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