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The Transparent Pay Revolution: Inside the Science And Psychology of Open Salaries

How many people know your salary?

Your boss, of course. Your partner, perhaps. Maybe a few friends you can trust.

What if everyone knew it? And not just everyone at your company; everyone like everyone—Internet commenters. Friends of friends. People you’ve never met.

This is the experience of every team member at Buffer, where we’ve been sharing our salaries with the world since 2013.

And we’re not alone in breaking the salary taboo:

  • The startup SumAll shares employee salaries within the company
  • Whole Foods has allowed any employee to make an appointment to view the company’s¬†‚Äúwage disclosure report‚ÄĚ for 30 years.
  • At Ricardo Semler’s Semco Partners, employee choose their own¬†salaries and share them openly.

¬†It’s still tough to find more than a handful of companies choosing this path, but interest in transparent salaries has skyrocketed over the past few years:

We’ve talked about why transparency was right for us at Buffer, but some bigger questions remain: What’s fueling this desire for pay transparency? And could it be right for your organization? I’d love to share some of the science and psychology behind the transparent pay revolution.

The counterintuitive secret of pay transparency

Here’s the biggest, most counterintuitive secret of talking about pay: Although one theory of¬†pay secrecy is that it helps “keep the peace,” the data says it’s doing just the opposite.

A survey of 71,000 employees byPayScale¬†found that the main predictor of employees’ satisfaction is whether they¬†feel they are paid fairly.

Even underpaid workers’ ¬†job satisfaction more than doubled—rocketing from 40 percent to 82 percent—when they knew why they were paid what they were and felt free to talk about compensation¬†openly.

Screen Shot 2016-02-09 at 5.02.51 PM

In other words,¬†how we¬†perceive what we’re paid matters more than what¬†we’re actually paid.

And¬†the more information we¬†have about why we¬†earn what we¬†do—especially in relation to our coworkers–the happier we are.

While employers might¬†fear that sharing compensation figures¬†could lead to jealousy between employees,¬†researchers found that clear communication about compensation is one of the top predictors of employee satisfaction—more important than things like¬†career advancement opportunities and employer appreciation.

The psychology of perception gap: We misjudge when we don’t have salary information

A pretty simple psychological underpinning is at work here: Our brains love to fill in the blanks¬†when they encounter a perception gap—often lazily, with bad intel).

So keeping pay secret doesn’t stop employees from guessing what their bosses and coworkers make.

From Psychology Today:

“People believe that if information is withheld it is for good reason. This in turn affects three types of justice judgements: informational (it being withheld); procedural (lack of employee voice and potential bias) and distribution (compressing the pay range).”

And when we¬†fill in the blanks of withheld information, we’re very often wrong. The same Payscale study found that¬†two-thirds of people who are likely being compensated fairly believe they are underpaid.

Screen Shot 2016-02-09 at 5.03.12 PM

Transparency can create happier, more productive workers

Which brings us to another element of transparency: How it affects on-the-job performance.

Of those above who believed they were underpaid (even if they weren’t!) 60% said they were unhappy at work and¬†planned to look for a new job soon.

How many of those folks might had stayed, with a much brighter outlook on their job, with the help of an open discussion about salary?

A variety of studies have shown that pay transparency can create a  more healthy, productive work environment in a number of ways. Happiness, of course, is a big one:


A study of 280 Israeli undergraduates found that¬†pay secrecy hurt¬†individuals’ performance and¬†weakened the perception that better work would¬†be rewarded with a raise.

Conversely, a 2011 study at the London School of Economics followed¬†companies that switched from pay secrecy to open compensation and feedback and noted that more information about pay led to ‚Äúa large and long-lasting increase in productivity that is costless to the firm.‚ÄĚ


More discussion of salary can create more equality

There’s another growing factor at play in the rise of transparent salaries: equality.

Tech companies like Pinterest, GoDaddy and Salesforce have all recently reviewed or announced plans to review overall employee compensation data to root out gender wage gaps or other challenges to equal pay for equal work.

How can we make sure underrepresented groups¬†are paid equally for equal work from the start? ¬†Transparency provides the clearest-cut solution we’ve discovered, in that it creates a culture of conversation¬†where¬†teammates¬†feel¬†empowered to share information and ask questions.

In 2015, the #talkpay movement, started by the programmer Lauren Voswinkel on the diversity-in-tech focused site Model View Culture, provided a boost here.

Voswinkel urged Twitter users to open up and share their salaries with the world. The hashtag would go on to get nearly 12,000 mentions,according to Fortune; and about 1,300 people published their salaries, Buzzfeed determined.

Voswinkel told The Guardian, ‚ÄúThis type of discrepancy is only allowed to exist in an environment where people are afraid to talk about this pay, and that‚Äôs the thing that I want to abolish.‚ÄĚ

Most recently, President Obama proposed a new rule that would require companies with more than 100 employees to report salary data by race, gender and ethnicity.

The other side of transparency: Cultural norms and tough conversations

So if pay transparency has all these benefits, why isn’t everyone doing it?

One big reason is that there’s a cultural stigma in many places in the world attached to talking about money openly.

In a fascinating blog post, Transferwise asked 50 people around the world if they’d ever be willing to share their salary openly and got a¬†crash course in how different¬†cultures view compensation.

“From the Belgians to the Japanese, everyone could concur it‚Äôs generally considered rude to ask how much money someone makes. The Brits claimed approaching the subject with a polite ‚Äúif you don‚Äôt mind me asking‚ÄĚ could make it acceptable. The North Americans (mainly New Yorkers and a few Canadians) were more reserved, saying it depended on the nature of the relationship and motives of whoever was asking.¬†The Dutch, Belgians and French confirmed it went against etiquette and was generally ‚Äėnot-done‚Äô.”

Here’s a cool word cloud of some of the terms that came up in their conversations:


In some regions there are rules and laws against talking about pay—and in many more, there’s a myth that these rules exist even when they don’t.

Even in the United States, where it is illegal to bar employees from sharing salary information, a 2010 survey found that nearly half of all U.S. workers reported being either contractually forbidden or ‚Äústrongly discouraged‚ÄĚ from discussing pay with their colleagues.

Beyond cultural norms, it’s also not the right personal solution for everyone—particular those concerned with privacy¬†in an increasingly¬†surveilled society.

The future of transparency

With the wealth of company and job information now online, interest in transparency is likely to increase along with the prevalence of sites like:

For employers, this growing phenomenon could possibly lead to tricky conversations—and¬†could potentially throw¬†older, more traditional organizations into a bit of upheaval.

If you’re interested in affecting change at your company, it’s helpful to know that it doesn’t have to be all-or-nothing.

Payscale shows that there’s a big spectrum from totally closed-off salaries to completely public:


The answer for you and your company might be somewhere in the middle. Some action steps might include things like:

  • Talking about your salary with coworkers¬†(if you’re legally able)
  • Asking leaders at your company questions about compensation philosophy
  • Sharing median salaries for roles
  • Sharing salary ranges for roles
  • Sharing salaries internally

At Buffer, we’ve been so honored that other¬†companies have chosen to adapt or modify our open¬†salary formula¬†for their needs, and anyone is welcome to build on and make it better for their team.

In addition, we’ve also launched a salary calculator, to make it easier to understand how our formula is calculated based on all its factors.

calculator launch

For anyone looking to take a job at a startup, working on salaries at a startup, or just curious about salary transparency, we hope our formula and calculator might cut down the time you spend on thinking about salaries by many hours.

What’s your take on salary transparency? Would you ever share what you are paid with others? I’d love to hear all your thoughts in the comments!

  • Bob Martin

    Great how you map it out. It gives me ideas that I can discuss with the people who are helping with what I’m trying. Remote – because there’s a way, I have a will, and I prefer it that way but I have a different perspective. If you have written about it in the past please clue me, if not ,,, what do you do to maintain motivation. I’m on a 5 member panel at one of he universities that “papered” me and that’s the topic I’d been thinking about it this week because besides remote and transparent some of the efficiency and readiness (keeping your job in state which allows rapid transfer of needed ) will take away both choice and feelings of “I’m special” and since we all truly are unique snowflakes, things to keep people motivated are king.and in the intensity model kings might loose their heads if motivation was stick based; Thx (can write in different way using lots more wyrds ;)

    • Awesome to hear that this post was handy for you, Bob! Interesting question on motivation; I’ve found that transparent pay at least at Buffer tends to create more motivation, i.e. The world knows how much I make so I’d better show that I’m worth it! I think perhaps this might work in part because we tend to pay over market; it might be tough to be motivated if you didn’t feel fairly compensated. Good one to reflect further on!

      • Bob Martin

        I investigated an idea I had about productivity, carried that to how much choice can you take away without affecting productivity, speculated on the different responses on the introversion extroversion spectrum, when neurotransmitter levels are the dominant causative, suggested means by which mood state or substance abuse could be deduces or inferred using simple and 2nd order keyboarding metrics and asked a behavioral scientist if he believed that self awarenss can be increase with and also without the “intent” of the subjects and another section went to my app; maker who is the only person I have met who has worked with combinatorial fractal geometry – mathematics that formed the center of a fusion of othree meths to …anyway, she can code and …I’d tell you but that’s where the IP comes in. – back to The Roadmap to Realization or What to Rxpect When you’re Inventing thru Get your skin back exiting the sharktank. Bye (pro bono work for physician/entreoreneurs breathe

  • I look forward to a time when this is more common. I think that the suspicion and resentment that can accrue from wondering what your colleagues make is toxic to many work relationships. Questions of relative value and ability tend to arise, and nobody ends up feeling very good about themselves.

    Like you said, understanding the reasoning and justification is more important that the number itself. If you can point to a solid explanation as to why Alex earns 10% more than Taylor, then you can calm the fears of (perceived) unjust gaps.

    Thanks for sharing, Courtney!

    • Totally with you, Brendan; makes perfect sense! Glad this one got ya thinking; thanks for reading!

  • I like the fact that transparency helps create equality in pay for both genders for equal work. That’s probably the best outcome since it’s been such a problem in many professions in the past. I don’t know how I would feel about everyone knowing. I guess it really doesn’t make much difference. I totally get how it’s a touchy subject in other countries. When I was living in France, people are not generally open about their salaries.

    • It’s so fascinating to see the cultural differences on this topic! Yes, the equality aspect is my personal favorite result of transparency. :)

  • Bryan Milne

    @Courtney, I believe that this is key “Sharing median salaries for roles &
    Sharing salary ranges for roles”. If employee’s are paid in the same range for a similar role with variance based on experience etc then then open discussion can indeed help create unity but if there is a great discrepancy then it could cause factions. Say a new person joins and negotiates a market + salary where as existing team mates (same role, skill, contirbution) are on market or below then the new persons salary being made known would not go down well. Kudos to @Buffer for being as open as you are.

    @BrendanFDMoore:disqus in addition to my post I agree 100% with what you posted.

    • I think you’re absolutely right, Bryan! Some studies have shown that open salaries tend to have the effect, of creating similar salary bands across similar roles. Could see that without having that similarity this process could feel very tough!

  • Nikesh Ashar

    @courtney – this is pretty much what we do at Makers Academy. One of our team went through the Advice Process to set their own salary recently.

    • Oh wow, so interesting! We went through a brief period of self-selecting salaries as well; really cool to see your process!

      • Nikesh Ashar

        I’m going through it at the moment – look out for the blog post soon. The Buffer salary calculator is open on nearly every screen at present

  • Coming from a background where salary was strictly forbidden to be shared (heck, all the salary letters explicitly stated that salary was confidential and not to be shared) — it was really eye-opening when I first read about Buffer’s transparent pay. Again, because of all the background and conditioning — it would be uncomfortable for me to share at first.

    But given the right environment, I’m sure I’d adapt very quickly. Kudos again for giving so much thought into company culture, and really going for it!

    • Thanks for the encouragement, Aaron! Wow, it’s so interesting to hear about salaries being so tightly guarded. Can totally see how our transparency would feel really foreign at first!

      • Yes, I find it fascinating how some beliefs can be so “embedded” into us that it feels completely natural (due to previous conditioning), but somewhere else the culture is totally different.

  • I’ve worked for companies from which you would be FIRED if you discussed your salary (with anyone besides your supervisor).

    • Wow, so interesting!

    • Nikesh Ashar

      That seems really counter productive

  • Michael Jenkins

    This topic has always been discouraged from every place of employment I have ever worked. When I had seen people discuss it I saw jealousy, resentment and anger from some people. I never understood why. There is a reason you are paid a certain amount.

    I like the idea of coming into a company and it all being open so there are no secrets. I always felt after a raise that I had to be quiet and couldn’t tell anyone. When you start breaking down walls of secrets you start building something different, true teamwork. Everyone is on the same page and everyone has the same goal. There are no questions on your position according to how much you are paid.

    I truly believe if you love your job then that is by far more important than what is in your check.

    • Hey Michael, thanks so much for sharing your experiences here! I can definitely empathize with uncomfortable experiences around pay discussion. Totally agree that this level of trust creates something special on a team!

    • “I truly believe if you love your job then that is by far more important than what is in your check.”

      Couldn’t have said it any better.

  • LeeAndra Fouts

    I’ve never been an employee of a company that openly discussed pay. At one office, we were regularly given quarterly raises and everyone knew when you were going into the manager’s office that day, that a raise was being discussed/given, but we still never discussed how much that raise would raise our income. It’s funny that discussing money is so taboo when our culture is so consumed with what that money will get us and how much of whatever it is we will get.

    • Haha I love the quarterly trips to the office; probably not so mysterious to many. :) Love learning more about how different companies handle this delicate process!

  • Peter PiŇ°ljar

    very nice article with good references ! thanks Courtney!

  • Taylor Campbell

    First thing, love the blog, the company, what you stand for :). Kudos for taking chances with traditional company structures and norms.

    I’m having some trouble with the calculator, not sure if it’s just me — I just get a page with the Buffer header at the top left, a “Learn all about Buffer’s social media tool” button top left, and a delightful background picture of some trees. :)

    (Potentially ‘helpful’ debugging info follows.)

    Going to the console, as any self-respecting web dev would do, I see:
    Uncaught TypeError: Cannot read property ‘experiments’ of undefined
    which traces to
    onboardingUIStateStore.js, ~line 7: this.State[‘experiments’] =;

    If I set a breakpoint before that and run ` = {};`, it gets past that and then gives me:
    Uncaught Error: Invariant Violation: _registerComponent(…): Target container is not a DOM element.

    This one traces to onboardingController.js, ~line 40:
    React.createElement(OnboardingMainView, UIStateStore.State),

    That onboardingApp element doesn’t seem to exist, so if I set a breakpoint and run:
    var o = document.createElement(“div”); = ‘onboardingApp’;

    THEN I can finally see the calculator. And it’s a bundle of fun as expected, but harder to get to than I anticipated. ;)

    Annnnd last comment/question, have you gotten rid of the family member input (shown in the screenshot)?


    • Hi Taylor! Wow, thanks so much for expending such effort to get to the calculator! This info you’ve provided will be super invaluable to our dev team; passing this along to them right now! And yes, great catch on the family element. We did take that out of the formula and moved it over into a grant area for a number of reasons. You can read about all of them right here:

      • Taylor Campbell

        Ha :). No worries, calc seems fixed now. And thanks very much for the link, I could probably have searched slightly harder for that clearly named article ;).

        • If it happens again please do let us know! Others have mentioned the “tree issue” also and we’d love to get this bug squashed for good!

  • Thank you for this post, Courtney. Not only have you shared something that works for Buffer and other companies, but you provide actionable tips businesses can use in their own ways to implement similar policies. Transparency all the way!

    I would love to feature the way Buffer is using transparency to improve the work experience. Would you or another team member mind answering ~3 questions by email re: the effects transparency has had for Buffer, to be published in my upcoming series?

    • Hey Lauren, thanks so much for the kind words here! Wow, it would be an honor to talk more about transparency with you. :) Would you be up for emailing your questions to our PR Specialist Hailley at

  • Sarah Prince

    What I don’t understand also is that when I apply for a position and am going through salary discussions, companies in my area (Utah) will never openly give reasons what they won’t meet industry averages.

    For example, for the current position I’m in, I did thorough research on average salaries in the exact city for my job offer from multiple reputable sources. But when the company proposed my salary, is was tens of thousands less than my research. And they would not say why.

    I hate how everything around HR and what people are getting paid is so hush hush, especially for people in the same positions. I think knowing what your coworkers are making will help you become more motivated to work better and smarter for that pay raise or bonus every year.

    • Spot on. Companies should be competing for the talent (i.e. – outbidding their competitors) rather than trying to slide by the whole conversation. The insecurity is a little baffling; when I worked in television, I was never jealous of the lead editors when I was just an entry level PA. Of course they get paid more than I do, they provide more value and have the skills necessary to do it.

      I agree on the point that with more transparency, it would be more motivating than discouraging to anyone with a good attitude and work ethic.

  • Courtney, I think what’s great about your piece is that you acknowledge that pin-point precise salary information is often tough for employers to psychologically get their heads around in spite of all the evidence you cite that salary transparency is not as disruptive as it might seem. Therefore, your suggestions for “baby steps” towards compensation transparency are important b/c they are practically what’s realistic for those interested in making progress but not changing everything they do overnight. This “middle way” of sharing compensation is exactly what we’ve tried to do at — we found that most people are not worried about missing out on a few dollars/cents but more interested in whether there are gross inequities in pay across similar or identical job titles. Therefore when we crowdsource salaries by title and employer, we simply ask for salary and bonus ranges — not exact numbers.

    • Wow, fairygodboss looks amazing; just registered! Thanks for providing an awesome resource to women!

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