Should salary discussions with job applicants be illegal?

argonadmin • September 2, 2019

There’s been a lot of talk recently on LinkedIn about whether candidates should disclose their salary during an interview, or as part of the application process. Interestingly, 17 states in the US have outlawed the practice and at least one large Australian company has followed suit, banning all salary related questions for job applicants.

However, for me, having salary discussions with candidates is a really important part of the vetting process – but not for the reasons you might think. Whilst the argument online is very much around deterring employers from lowering the salary that they offer to match the candidate’s (lower) current salary, in my experience the issue is quite the opposite.

Locally, I think the bigger issue is candidates’ applying for roles below and sometimes well below the salary they’ve previously been on. The reasons for this vary, however a lack of job opportunities in their chosen field and minimal wage growth are often factors.

Regarding wage growth, we particularly see this issue with candidates who have left long term roles where they have received pay increases over the years resulting in an inflated salary well above the current market average.

It’s a tough situation because I can appreciate both sides of the issue, if you need a job, you sometimes have to take what’s available at the time. However, for the employer, they need to be cautious not to employ someone who’s a ‘flight risk’ who will exit the business as soon as a better opportunity presents itself.

Recruitment is all about getting the right ‘fit’ across a number of areas including team and workplace culture, skill set, location, etc. – salary is just one of these areas. If any of these aren’t a good match, then you have a potential issue.

There are certainly instances where taking a lower salary is completely legitimate, however if I have a candidate applying for a $60K role and they were previously on $80K it’s a red flag and further discussions need to be had. In my experience, candidates in these circumstances often withdraw their application prior to an interview, turn down the job offer, or they accept the role but feel resentful and never fully engage with the organisation or their role.

Having conversations around salary also benefit the candidate. More often than not, candidates receive a pay increase moving roles. This only comes about because we’re able to provide the details of their current salary package to our client, allowing them to make an attractive offer.

At the end of the day, I’m all about having open and honest communication with both my clients and candidates with the aim of placing people into long term roles. So, for me, having these discussions is a really important part of the process and I certainly don’t believe we need legislation or regulation around the topic.