HRIS and ‘pay secrecy’: What you need to know

In most cases, employers cannot forbid workers from discussing pay amongst themselves.

In most cases, employers cannot forbid workers from discussing pay amongst themselves.

The question of whether or not employers can prohibit their workers from discussing their pay is not as straightforward as it might seem. Depending on where a company is based within the United States, certain restrictions may apply, leaving certain terms open to interpretation. HR software can be used to promote better consistency with the law, as employers avoid enacting unlawful policies.

"Pay secrecy," also known as "wage secrecy," doesn't have to refer to an official policy written down in company handbooks. As an NPR story from last year notes, a policy can also simply be strongly implied, further making it harder to track. In any case, workplaces cannot forbid employees from discussing their pay, as the National Labor Relations Act protects employee conversations.

In most cases, companies are not allowed to forbid their employees from discussing pay.In most cases, companies are not allowed to forbid their employees from discussing pay.

While the penalties for employers that violate this policy may be relatively minor, companies still owe it to themselves and their employees to stay on the right side of the changes.

While the penalties for employers that violate this policy may be relatively minor, companies still owe it to themselves and their employees to stay on the right side of the changes. In a piece for the Society for Human Resource Management, Joanne Deschenaux refers to attorney Cassandra Carroll, who advises California businesses in particular to research pay secrecy rules.

"Be sure to review employment contracts, employee handbooks and other written materials to ensure there is no language that could be construed as limiting an employee's right to discuss compensation," Deschenaux writes. "Also, be sure to inform all supervisors that discussions regarding pay should not be discouraged, and certainly should not form the basis for any employee discipline."

Companies that need assistance enforcing certain rules may need to implement a fitting HR software solution to prevent legal violations. Expert consultants will advise on the platforms that work best for your business.