Should Tech Firms Ban Salary Negotiations?


techannouncementEarlier this month, Reddit CEO Ellen Pao told the Wall Street Journal that she would eliminate salary negotiations for new hires.

“So as part of our recruiting process we don’t negotiate with candidates,” she said. “We come up with an offer that we think is fair. If you want more equity, we’ll let you swap a little bit of your cash salary for equity, but we aren’t going to reward people who are better negotiators with more compensation.”

Why did Pao decide to pursue that somewhat-radical path? After all, the ability to negotiate over salary seems like one of those bedrock principles of modern corporate life—innumerable websites and books offer advice on how to leverage as much money (and perks) as possible from a new employer.

But Pao feels that women are at a disadvantage when it comes to negotiating salary: “Men negotiate harder than women do and sometimes women get penalized when they do negotiate.” In her mind, eliminating the prospect of negotiations levels that part of the playing field somewhat.

As pointed out by Mashable and other publications, a handful of studies over the past decade have suggested that men indeed tend to negotiate more assertively than women.

Some pundits applauded Pao’s move. “I think ending that kind of one-side negotiation is important,” Noreen A. Farrell, executive director at women’s rights advocacy group Equal Rights Advocates, told Fast Company, “and I applaud Ellen Pao’s willingness to test an out-of-the-box solution to a real problem impacting women and people of color in the workplace.”

But not everybody seemed onboard. “It’s true that women don’t fare as well in salary negotiations, but the fact is, they don’t fare as well with compensation generally as men,” career-advice columnist Alexandra Levit told Mashable, “and this [move by Reddit] won’t solve the age-old problem of unconscious bias.”

Reddit is a popular property at the moment, so it has no trouble pulling in top talent. But is eliminating salary negotiations something that smaller, relatively unknown companies can do, and still attract the people they need? Will people feel cheated if they can’t squeeze out a few more perks and dollars from their next workplace?

Advertisements

Posted on 15 April 2015, in Jobs, Tech Announcement 2015, tech news and tagged , , , , , , . Bookmark the permalink. Leave a comment.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: