What was your last salary? New York City has passed a ban on this type of question by employers in the interview process. That would be illegal in EU also, so if asked applicants are allowed to lie. Problem is that many women and minorities don’t get the chance to be offered better paying jobs over time, and may not get those raises, despite excellent work performance and contributions. They end up staying in similar roles over time, reducing how good they look on a resume, and therefore don’t get given jobs with more responsibilities than what their resume shows. For example, few employers are going to pay a registered nurse that transitions into a completely different profession the same wages they were making in the nursing profession. In part, the rule is motivated by the historic wage gap between women and men in professional roles.
Companies for the many reasons do still ask the candadite about their last salary. One is to determine approximate age of a candidate. Companies go out of their way to prove that they are not discriminating based upon age. We see companies regularly see companies moving senior employees (the highest paid) out systematically in order to lower payroll. Basing future salary on a prior salary which was flawed to begin with only further perpetuates the problem. A person’s salary trajectory does not necessarily indicate an increase in actual skills or work performance on the part of the candidate. If the individual received pay raises in the same company over time, this might be the case but you would have to know why exactly they were given the raises. Were they contributing in a non monetary fashion by improving customer service and long term loyalty? Did they increase employee engagement and productivity with reductions in turnover? Did profits steadily increase over time? Or were they just hitting quarterly numbers, which can be a sign of greed.
Is it nice to ask such a question?
There are a lot of top performers who actually don’t get pumped up salaries and bonuses as quite a number of companies pratice the bell curve approach to curtail. A firm should know what they are willing to pay for a position. Should not matter at all what a candidate was making before. If they know what the salary range is for a job and still want the position, salary history serves no purpose, except to try and pay the candidate as little as possible. This is speculation and asking a candidate about their salary history is irrelevant for role performance. Past history is no guarantee of future results.
Not all companies pay market value for talent, while others do, and others pay over. It all assumes every job in life is done for money only. There are people who work years on voluntary basis. Also, salary history does not take into account people who transition from one career into a different one. It’s not correct to assume hiring managers for financial services are making the same considerations, or looking at all the same data points, as those hiring for IT related jobs, for example.
If you can’t get a good read on one’s performance from thier career position progression, that person probably shouldn’t be joining you anyway. And what does “screen the ones we can’t afford” even mean? Hiring is a decision between business value delivered over salary to the power of cultural alignment/EQ. If that formula is met, there is no such thing as “unaffordable”. Salary history is none of their business. The candidate, recruitment consultant and company can negotiate a package appropriate for the role being offered.
Asking about Last Salary as an HR Manager
Requests for salary history hurts potential employees, and more so women candidates since it perpetuates lower salaries than their male counterparts throughout their careers. If you have a salary budget then you follow the budget or in special case if you are allowed to go a bit overboard. If you look back at all the people you’ve hired in your career, if you think about the great hires and not so great hires, how much did, or would have, salary history helped in making a better decision? Asking for salary history seems like a lazy, invasive, and simplistic way to do it. It is the same like asking how many kids you have; but you can say what your expectations are and this only if you can get a clear understanding of the role (which is not always the case).
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Looking good on a resume and hitting short tem numbers do not make a person a medium and long term contributor. It may mean the person has been lucky. At the end of the day, one of the worst things that can happen is for the hiring company to feel like they are overpaying you once they get a true taste of your skills. It’s also distressing to find that you have an underpaid employee. As a hiring manager you know that people will talk about their pay so it is important to be able to justify the numbers and get it right from the beginning. Pay history may help.
Why asking this question is important?
Asking for a salary history does not show your worth or your negotiation skills. It only shows how in-touch- with- fair-market-value your last employer is/was. Be up front and honest about what the salary range is for the posted job and let the cards fall where they may. If the hiring manager/company wants a ‘disqualified’, use education as the key factor to block the application process rather than salary. If you are looking for someone with a Master’s Degree then use that ‘box’ as a determining factor for new hires- not the salary ‘box’. We all want talented people working for us; who cares what your salary history is? You can’t buy talent anymore than you can buy happiness.
If a company is negotiating in good faith, they should have no problem making sure there is information symmetry. Ask for the job grade, the salary range, the average tenure in the role, and the average salary penetration. And tell the company you’re sure the company believes in paying based on the scope of role and value to the company, but you’re happy to share information to be transparent, just as you’re sure they are. Some of these reasons for requesting an applicant’s salary history can be solved by requesting an acceptable salary range from the potential employee.
The real reason they do it is to try and pay you as little as they can
Past practices by (some, not all) employers have been to get away with paying as little as possible. However, not understanding the organization’s labor market can cause lower salary offers that will disengage the employee quickly from his/her work. In the long run, this is more costly to an employer because they will likely have to fill this position again in the near future. The employee then becomes dissatisfied and will look for a new place of employment. It also shows the employer whether the candidate is expecting a salary based on the work they will be doing. You will know if the candidate is simply asking for more than what their skills and the job are really worth. Start hiring for attitudes training for most skills. A resume is a sigh of a good or bad luck, not always their performance.
Think of the interview process as a means of getting a great person to be on one’s team – not a means getting a jump on salary negotiations. Companies should state in the advert what the job pays. If you apply, you are accepting that condition of the contract. Previous earnings or lack thereof, are of no value going forward. BWT – male and female people have “sexes”; masculine and feminine things have “genders”. Asking a candidate for their salary expectation at the interview stage can be useful, as it shows they have thought about the value of the job in terms of responsibilities etc. Also, remember, some interviews are conducted to meet race, age, nationality profiles. So be calm.
Last Salary an important information to guess about Money Hungry Candidates
A money hungry candidate who is obsessed with quarterly targets and constantly goes after the compensation package when considering a new job is going to be a huge problem once employed. Their arrogance and pride regarding how much money they made over the years will come back to haunt customers and employees for sure. In this regards, there is one and only one reason employers ask for salary history: they want to pay new hires as little as possible. More often, these candidates, despite their technical skills (which can be taught on the job in many instances), have serious attitude and personality problems that will show themselves in the following ways. Once they get passed your probationary period, they will begin to display a sense of superiority in relation to others. They will find ways to tell you that they are more talented/special than others, and will demand special treatment and possibly bigger raises/bonuses. This will disengage other team members and employees throughout the company, and people will start leaving. Staff turnover is costly.
Clients and customers will be put off by the poor service and aggressive sales tactics used by such an individual, and will rightly go elsewhere, but not before saturating social media with all the gory details of their bad experiences. Customer loyalty is more important than hitting new sales targets. Immediate gains are a sign of greed on the part of the employer. They are very charming, especially in front of management, but are nasty, calculating, and manipulative to everyone else. This charm an ability to convince leaders of their perceived value will eventually cause the company more problem than those that get solved by short term achievements. These people do not accept constructive feedback from anyone, whether that’s customers, team members, or people across the business. If you think they take feedback, direction, and coaching from managers, think again. Instead, they feel that the normal rules don’t apply to them, and that they are entitled to be favoured by the boss. The only time this doesn’t happen is when management have not seen or don’t care about this person’s behaviours towards others. They kiss up and kick down, deceiving management into giving them promotions and pay raises.
They have almost zero empathy for anyone, even their favourite people. Those who like them are nothing more than objects to be used to serve the purpose of moving them through the ranks. Once you are no longer useful to them they throw you under the bus and become nasty. They can even get innocent people fired due to their persuasive abilities and charm. If these are not bad enough, just wait until the employee starts to bully staff once they get promoted to management because of their technical not their people skills. This will create a toxic organisational culture that reduces productivity and increases anxiety among employees.
Last Salary a Private Matter
Specially in the job world, you reveal your correct salary or not, the other side (interviewer) will never stop judging you on the so called formats already existed in their system or their subconscious. As Candidate whether or not to answer such a question. The answer is a big no. A person’s current and past salary is private, and nobody except perhaps the banks, should have the right to ask for this information. Candidates are more likely to be disadvantaged. Pay should be based on the job, not the person. Bill Clinton gets tens of thousands for presentations but nobody would pay him that amount to do janitorial work. Just as HR does not share all informantion, you are not expected to either give all. Salary history is no one’s business but yours.
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