Salary Information: Secrecy or Openness?

Paper Summary:

This paper examines secret and open salary information policies. The author argues in favor of an "open" policy. An attempt has been made to discuss both sides of the picture. The conclusions have been drawn after a thorough analysis of the arguments.

From the Paper:

"A case can be made both for and against a secret as well as an open pay policy. That is why we find almost an equal number of organizations that follow either of the two systems. There are surprisingly large numbers of organizations, particularly in the private sector, that not only keep the salary information of their employees secret but also require the staff to keep such data under wraps. Punishment for release of pay information in these companies is often severe and can even lead to dismissal. Although there is always some merit in a counter argument, I am convinced that an open salary information policy has greater benefits while a secret pay policy can lead to serious organizational and motivation problems."

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