One of the most important lessons we were taught in business school was how to talk about salaries with colleagues. Some people could immediately disconnect their paycheck from their self-worth; sharing their salary was no different than sharing their phone number. Others became visually uncomfortable when the topic was broached; this was an extremely personal secret that they wanted to guard closely.
In public accounting, as in many business environments, you’ll usually hear two competing schools of thought:
- Don’t share your salary with coworkers. It results in colleagues becoming envious and bitter when their self-perceived worth doesn’t match their paycheck.
- Share your salary with coworkers publicly and proudly. This removes management’s asymmetrical information advantage*, and can result in more equitable pay.
Both theories are supportable. Nothing will degrade workplace comradery faster than a disgruntled coworker who just found out that the new hire is paid 20% more than the tenured workhorse. However, there’s no way that tenured workhorse is ever going to work up the courage to ask for a fair wage if they don’t know that they’re underpaid. Provided you’re discussing salaries discretely and in good faith, sharing is always the better course of action.
To avoid sowing discord in the workplace, knowing when to talk to your colleagues about their salaries is critical. This isn’t a conversation you want to have in your first week on the job, nor is it one should you have in open forum. Let’s examine the nuances so you don’t bungle the first step in a process that could lead to you or your colleagues negotiating a pay raise.
When to Share Your Salary
There are three outcomes when you and a colleague share your salaries with each other:
- They make more than you. If the difference is small and easily explained, there’s no harm. If the difference is large or seemingly incongruent with work experience/education/familial ties to the partner, this may spur you to action. Hopefully positive action, like negotiating for a raise, and not negative action, like stealing office supplies to make up the difference.
- You make more than them. Same situation as above, but reversed.
- You make the same amount. The whole conversation was an exercise in futility, but at least now you know.
Generally, it’s not wise to share your salary within your first 3-6 months on the job, unless you’re sharing it with other new hires. New hires are still building their reputations and integrating with their teams. They all probably make about the same amount anyway. As a new hire, asking a tenured employee what they earn is likely to cause strife. Colleagues won’t share salary data if they don’t trust you to be discrete with that knowledge. Once you’ve built rapport with your teammates and have earned a reputation for being trustworthy and reliable, then you can start asking hard questions.
The other reason it can be a faux pas to ask a tenured employee’s salary as a new hire is that there’s a decent chance you make more than they do. With few exceptions, salaries rise faster for those that job hop than for those that stay at one firm. Nothing will annoy an experienced associate more than learning that the new hire is making more than them while they’re training the new hire. It boils the blood.
In short, when you share your salary with colleagues, the following should be true:
1a. You have an established reputation for being trustworthy and discrete; OR
1b. You are sharing your salary with a colleague of a similar rank and tenure; AND
2. You’re having the discussion in a private setting.
How to Share Your Salary
Now that we’ve established whether or not you should share your salary with colleagues (you should!) and when you should share it (privately, when your reputation supports it!), we can discuss the “how.” This boils down to the setting and phrasing your question.
My preferred setting is during a 1-on-1 coffee break outside of the office. Getting coffee is “work adjacent” without the formality and expectations of actually being in the office. It’s an easy place to chat without being overheard by a nosy HR representative. If you feel like you need a little liquid courage, my second favorite setting is during a post-work happy hour. I recommend talking salary early in the happy hour because if you’ve had too many drinks, emotions may be running high.
As for broaching the topic with a coworker, my preferred phrasing is something like this:
“I’m curious what the salary range is for senior associates in the Memphis office. Would you share your salary with me if I shared mine with you?”
There are several reasons I like this setup:
- Expressing curiosity about the salary range in a specific office couches your question as a search for knowledge. You’re not trying to make a direct comparison of your salary to your coworker’s, they’re both just part of a larger data set.
- Some people are never going to be comfortable sharing their salary. Phrasing it as an option gives them an easy way to say “No” if they’re opposed to the idea.
- You’re offering symmetrical information. If they want to know your salary, they have to offer theirs, and vice versa. This directly combats the asymmetrical information advantage favoring the firm.
If they’re agreeable to sharing, the rest of the conversation is just a matter of being polite and honest. I also recommend telling them that you won’t share their salary with anyone else. It should always be their decision to share personal information. You don’t want to sully your reputation by being a gossip.
Other Etiquette
- Regardless of the outcome of the conversation, you don’t want to advertise that you’re talking to coworkers about their salaries. Management can get fiercely upset if they learn these conversations are happening, and even though they can’t directly punish you for sharing how much you’re paid, they can make life annoying out of spite. Remember, these conversations erode a valuable advantage for management, and they may not part with that benefit easily.
- If you find out you’re severely underpaid after talking with a coworker, don’t immediately run to the partner asking for a raise. Before you have that conversation, you’ll want to build your case, ensure you have leverage, and justify your request. “My coworker is paid more than me,” is not sufficient justification for a raise. It also begs the response, “How did you learn your coworker makes more than you?”, which we just determined is the last thing you want to be telling a partner.
- Generally, you only want to share salary data with peers and those immediately above or below you in the hierarchy. For instance, if you’re a senior associate, it’s acceptable to share salary information with associates, other seniors, and managers. Knowing what an associate makes tells you about your firm and the industry’s health (if new hire salaries are rising, generally the labor market is strong, and vice versa). Knowing what a manager makes tells you what you can expect when you’re promoted. Knowing what a senior manager makes might be interesting, but their job is so different from yours that the information is basically meaningless.
*Asymmetrical information means that certain parties in a relationship have access to more or better data than the other parties. In the case of public accounting, partners, HR officers, and firm leaders will know the salaries of their employees. This means that when they’re negotiating salaries with a new hire, for instance, the firm leaders have a much more accurate reference range than the estimate provided to the applicant. They can extend a lowball offer that’s less than any current employee’s salary. If the applicant accepts, the firm wins by underpaying a new hire, setting the actual range even lower; if the applicant negotiates, the firm can push the negotiation towards the lower end of the existing salary range.