Clear And Present: What’s next for US pay transparency? 

Lauren Jenkins  0:04

You’re listening to Prosperity at Work from JP Morgan Workplace Solutions, the podcast all about equity compensation, financial, well-being and more. I’m Lauren Jenkins, Head of Executive Participant Servicing at Workplace Solutions.

Chris Dohrmann  0:16

And I’m Chris Dorman, Executive Director of Strategic Partnerships and Workplace Solutions. This week, we’re taking a look at a bit of an emotional issue for employees, as well as an elephant in the room for US companies right now, pay transparency.

Lauren Jenkins  0:30

So from a government to an individual level, there’s demand for transparency on jobs. Like it or not, it’s already here and it’s coming for your state soon, so get ready.

Chris Dohrmann  0:39

This week’s guest has all the insight you’ll need on how this impacts comp and benefits. We’re joined by Nancy Romanyshyn, Senior Director of Total Rewards Strategy and Solutions at Syndio. Nancy, welcome to the show.

Nancy Romanyshyn  0:52

Thanks so much for having me. I’m so excited to be here and talk with you both.

Lauren Jenkins  0:57

Nancy, tell us a bit about Syndio and your role within the company, and how that connects to the issue of pay transparency.

Nancy Romanyshyn  1:02

So Syndio is a software analytics platform. We help companies do analyzes where they can make sure that they are paying people fairly and promoting and conducting performance fairly and consistently throughout their organization. So we provide both analytics through the software as well as expert support, really helping them navigate through things like pay transparency. And the work that we’re doing with so many of our customers is helping them do the analytics to prepare for pay transparency. So really getting a better understanding of how they’re delivering, pay, how they’re promoting people, how people are advancing and moving to their organizations, so that that way they can be more transparent about what they’re doing and make refinements potentially to their programs before being transparent. So we’re just helping our clients really navigate this new world of transparency.

Chris Dohrmann  2:01

Let’s talk a little bit about what repay transparency really means. Where is this new legislative trend coming from? And as a secondary question, what does it really include, both now and maybe in the short term?

Nancy Romanyshyn  2:16

I think it’s a great question, because when we talk about pay transparency a lot of times we think first and foremost of the legislation. So we know that there are so many different regulations across so many different jurisdictions around a variety of transparency requirements. So it may be posting ranges around when you’re advertising for a job. That’s sort of a kind of simple way of looking at it, but I think we know it’s so much more. So what we’re finding is the legislation is saying, well, it’s not just say the range for base salary, but it’s looking at other components of compensation. It’s being transparent around how folks are advancing in your organization. What are those opportunities that they have for advancement? It’s being those types. It’s really looking at a lot more than just pay and I think that’s one of the things that that we’re seeing really emerge. And then I think the other dimension of it, Chris is really thinking about how different jurisdictions come at it. So in the United States, we tend to be, I don’t want to say a little more laid back, but believe it or not, a little more laid back. We’re less prescriptive, and we’re starting to lean into being more prescriptive about what exactly we want employers to post and share and disclose. Where in Europe, you find a lot of the European countries have been more prescriptive. There are specific analytics that they’re asking you to provide to demonstrate that you have fair and consistent pay practices and talent management practices. And I feel like everything’s sort of feeding into itself, and everybody’s sort of learning and borrowing from one another, and that’s really what, what is continuing to emerge.

Chris Dohrmann  4:05

And you read my mind, because that was the point I was going to bring up as a follow up, the fact that in the US, this is almost following the same type of path as data privacy did, where each jurisdiction is going to be either assertive or, as you know, basic as it wants to be, and that’s a problem for employers and employees alike, because they have to navigate all in multiple jurisdictions and then deal with an overarching format, much like the

Nancy Romanyshyn  4:34

EU as 100% agree. I think that’s what we’re hearing a lot from employers, is, you know, okay, I get it in this state or in this country, we have to do this. We have to do this. But, oh my goodness. Like, how do i First, how do I manage the complexity of all that, the patchwork of different legislative requirements, and then, how does that relate the all of these compliance exercises? How does it relate to what we’re. Trying to do from an employee value proposition standpoint. You know, how we this is all about how we value our employees. So how do we have one holistic approach, one consistent sort of set of messaging and way of operationalizing that? So that’s what we’re seeing a lot of you know, most of our our customers are global, so they have many different places in which they’re operating, and that’s what I think is really rising to the surface. Just like you say this, it’s now we’re sort of in this moment where employers are saying, Whoa. We need to have a strategy around this, a true transparency strategy.

Lauren Jenkins  5:36

So pay is personal, but transparency is, of course, public, what is your take on these two opposing forces?

Nancy Romanyshyn  5:43

So I think there’s a convergence. I would say that is happening. I think we are in a place where we need to think about all of that, how I think employees now are part of the conversation when it comes to pay in a way that they’ve never been before, because they actually have access to more information now than ever before. So from this sense of pay being personal, it is getting up to a point where employees have agency. Employees are not just advocating for themselves from that right, emotional, personal place. They’re advocating for each other. That’s been really fascinating. When you see somebody post, hey, I was a marketing analyst at this company. I’m leaving, but I want you all to know what I was making, so that when you apply for this job, you know what you should be asking for, wow. I don’t think we’ve ever seen anything like that before. So I think what employers you know or would do best to do would be to really lean into that and say, Hey, we get it. Let’s have a conversation about how we value your work, how we value your contribution, how we value, how all of that, those values, come together so that and meets our business objectives. This is what we’re trying to achieve with our pay programs. This is how it ties to our business. So these are all the things together, how it works together. This is what it means, then, how we value, the role, the skills you bring, and this is how we’re going to value and how you can advance, how you can build on that. This is how we can share success together. I think that’s really what I’m seeing happen, but I think, to your point, it hasn’t happened that way in the past, so I think there’s a there’s a transition that’s happening right now.

Chris Dohrmann  7:36

Nancy, I’ve heard you talk before, and we’ve seen each other at national conferences and mutual clients. And what I’m struck by is, you talk about, when clients first hear about pay transparency, they have a wait. What response Am I exaggerating that even just a little I

Nancy Romanyshyn  7:54

think now, Chris, you and I have had this conversation about generational differences too, in terms of, you know how some of us feel about transparency. Like you said, you know, pay is personal, and we have to be conscious of the fact that you know, who are the folks in leadership? They’re folks that are, you know, our contemporaries, right? So there’s been this big change management a couple of years ago at one of those conferences, Chris, in fact, what I did was I actually shared my own personal pay history as part of my presentation. And I looked at everybody in the audience and I said, Are you uncomfortable? I’m uncomfortable right now. Did that make you uncomfortable? Because guess what? This is what’s happening so and I want you to be ready to be uncomfortable. And it was, it was extremely uncomfortable, but yeah, I think employers, it’s rare the employer that say leans into it right away. I think there is that visceral reaction when we think about the way we’ve managed comp and design programs in the past, we used to say things like, this is our competitive advantage how we’re paying you, and especially when it comes to beyond base salary, when we’re talking about bonus and equity and and how we structure those programs, I think everybody is realizing it’s all out in the open, so we’re going to have to think of other ways to have a competitive advantage. And I think that’s that’s going to take some time for I think some employers are transitioning more quickly and leaning into that than others, but yeah, I think it’s safe to say most folks are feeling vulnerable about transparency,

Chris Dohrmann  9:30

and you are 100% correct as the oldest person here, I would say that I would rather talk about my medical history than my pay history. So you are spot on one other issue, and I wanted to bring up, is many companies, after the pandemic, may have thrown up an unintentional hurdle for themselves by by having geographical differences when people go from low cost or high cost of living areas and they’ve adjusted salary with pay transparency the same job. Job done in different places may pose a problem. Have you seen that

Nancy Romanyshyn  10:05

prior to the pandemic? A lot of my so I was, I was a long time consultant at Willis towers, Watson, that’s where I spent the majority of my career. And a lot of my clients prior to the pandemic didn’t necessarily have formalized geographic differential approaches. It wasn’t necessarily something they communicated to employees if they were doing it, and they had somewhat different ways that they were doing things. The pandemic hits, and all of a sudden they have all of these remote folks, or they’re deciding who’s in person, who’s remote. How do we navigate this? And the pay issue really did kind of come to the forefront, because then it was, well, wait, I’m not requiring them to be here. And then, oh my gosh, I have employees that are moving across the country that I don’t even know about, you know? So I think what it what it required, was a level of transparency. We’re gonna be saying that word a lot, but it required us all kind of being grown ups about it. And I think there again, you have some employers have been pretty resistant. We’ve had conversations with folks where they’ve said, Wait, we have to post ranges. Now, my folks in, you know, Alabama, we’re gonna have one range, and then the folks in Pennsylvania are going to have another range, and they’re going to see it, and I’m like, Well, yeah, but I bet if you talk to them and said, Well, hey, you’re going to buy a house here versus here, or you’re going to rent an apartment here versus here, I think they know that there’s a different cost of living, so there’s probably a different cost of labor, and you could Talk to them about that and how you’re structuring that, but I agree it’s on the face of it. First it was identifying and sharing. Yes, we we do value labor differently depending on the market, because of local market forces. But then the second piece was, okay, now, how do we reconcile that you’re no longer working in the Bay Area. You’ve moved away from the Bay Area, and we have a differential for working in the bay area because it’s cost of labor. It’s high there, but you’re working now in Idaho, so we’re going to adjust your pay. You saw some employers come out pretty loudly around that. We used to get asked that a lot as people were reconciling that. And I think my advice was always, it’s never great taking pay away from people. It’s always something that always, you always kind of want that to be your last resort. That’s not a wonderful message. So one of the things we, you know, we typically advise is, why don’t you look analyze it, look at the scale. Look at how many employees you have in certain locations and model the changes that you would make and maybe, maybe taking pay away isn’t the right thing. Maybe it is the right thing, but maybe it’s not the right thing, but I do think it’s led to, again, more transparency around this is how we design a pay program. Your job is valued differently depending on where it is, because of cost of labor, maybe cost of living does influence that as well. Scarcity of talent, you know, my my data scientists, get a premium right now because there aren’t as many of them, and we need them, you know, those types of things, those types of choices. But I think being, you know, having a conversation with employees, just explaining to them that rationale, employees respond, well, they like that there is this purpose and this rationale associated with how they’re paid, because their pay is really important to them. So they want to know that there’s a plan behind it. Absolutely,

Lauren Jenkins  13:37

I think that’s one of the big things with transparency is just creating that dialog thinking about other impacts here on compensation and benefits and overall total comp What do you see trends wise as it relates to this pay transparency?

Nancy Romanyshyn  13:56

One of the things we’re seeing is, yeah, transparency is definitely changing the design of pay programs. So we are seeing things like sort of a, I want to say, a normalization in a way of base pay for sure, where you’re going to see less variation, less swings in the data around base salaries as more and more people are sharing what they make. And, you know, again, there may be differentials based on location, but it’s but in other words, things that are observable, things that are objective, not you know, Nancy negotiated for that really high salary, you know, so you’re seeing, I think you’re continuing to see some of that, at least, employers moving toward that, employers around base salary. Employers are also tightening those ranges because they know they have to post them. So you’re seeing employers move to functional ranges. So maybe all of finance, rather than having finance marketing, HR, everybody in the same band, you know, this global band, we’re going to say, No, this is Finance. Yes. So within that, I have financial analysis, I have accounting, you know, I I have, you know, tax. I have some of these different job families and they and they may vary, but at least I have this one consistent range and I can and a structure that I can better communicate with my employees. We’ve seen some companies go to job based ranges, which is fascinating to me, and I think, difficult to manage, but some companies are choosing to do that. They’re like, forget it. We’re just going to go to that. So I’m seeing that change around transparency. The other interesting thing I’m seeing is, especially among, say, some of your large tech companies, there’s a lot available in terms of information on the internet around how equity is structured, vesting schedules, like different it’s really fascinating how a lot of that is being shared. So I think that too goes to really recognizing that, you know, employers may be coming in with this design, but now it’s you’re seeing the public kind of weigh in, and the people that you’re attracting and incentivizing are weighing in on it. And I think there’s sort of this feedback loop that’s developing around, is that fair? Is it effective, you know? So I think that’s going to shape some of what’s done around how that’s structured. So I think things are just becoming less nuanced at an individual level. There may be, I think we are seeing an increasing nuance, though, at more of a group level, function segment of industry, those types of things. It’s just that we have to be able to explain? Well, yeah, we teach, you know, we treat these folks differently for these reasons, these objective reasons. So it’s more like that versus, say Nancy negotiating for a better deal. So

Chris Dohrmann  16:53

just let me sum up so companies that have a philosophy and are also multi state employers or multi country employers, and knowing that in the US, they’re not likely to get an overarching federal, codified regulation here, what are they doing? Are they forming at least common denominator strategy?

Nancy Romanyshyn  17:13

They are developing a strategy. First of all, it’s elevating, it’s coming out of, say, compensation administration sort of level, and it’s you’re seeing that total rewards. Leaders are really elevating it to say, hey, leadership, we need to let you know this is a strategic imperative, our approach to transparency. And then they’re putting together, say, different work streams to determine exactly, let’s assess what’s required. What do we do now? What’s, you know, let’s do the gap analysis. What do we need to do? Where are all the data? Do we have one system? Do we have several systems? You know? How are we going to do that? So they’re doing sort of this assessment, and then they’re moving toward, you know, again, depending on how centralized or decentralized they are, that really kind of dictates the speed we’re seeing kind of a centralization right of how we need to address this, and we’re seeing transparency strategies play out, I want to say at the country level, at the very least, where folks are making a decision that, okay, yep, we have significant operations in, for instance, New York and California. And now, you know, we’re seeing other states follow suit. So we’re not going to do different things in different states. We’re going to have one us view with the EU pay transparency directive, you’re seeing sort of a similar motion where, and that’s what that’s done, is that’s laid out sort of a least common denominator the EU pay transparency directive is the floor. It is saying you need to do these five things, and then each of the member states can transpose the law, and you can, they can toss in their own little flavor of what they want to do. So that’s what Sweden did. Sweden said, we make you do all these things already, and we’re going to do the EU pay transparency directive. So you’re going to have to do all of it. So I think for a lot of employers, what they’re what they’re in the midst of deciding is, do we do anything beyond country by country? Do we do an even sort of broader strategy? And I think that’s still in play, but what I’m hearing is we, we typically have a global perspective. We are going to be globally transparent. But then there’s an element of, we’re going to sequence that country by country. We may decide not to, depending on whatever’s going on in that particular country. It may look different country by country, kind of a thing. So that that right now, that’s really what’s playing out, but, yeah, having, but at least having a strategy across the enterprise for sure, and

Chris Dohrmann  19:46

just to be completely, you know, transparent, that’s what prompted my original interest in this whole discussion. Because equity compensation is part of the EU directive, but not yet part of the. Us. You know, approach to this maybe coming soon in jurisdictions like New York City or Colorado or even Hawaii, but not here yet.

Nancy Romanyshyn  20:09

That is exactly right. Companies are realizing just because this is what’s the bare minimum that’s being articulated, there’s eyes on all forms of discretionary compensation and beyond, because in the EU pay transparency directive, they talk about benefits, they talk about allowances, they talk about a myriad of different things. So when I’ve spoken with some global employers, for instance, that have grown by acquisition, it starts to get a little problematic, because they may have made different deals with different companies that they acquired, and they may still be in a transition stage. So yes, three years ago, we acquired this business entity, and, oh, that’s going to be transparent now that those employees get this and these employees get this even though we’re all one company. So I think preparing for that eventuality, that there’s going to be some level of disclosure that you’re going to have to make on all forms of compensation. So what you know, do you want others telling your story, or do you want to tell your story? I think the other thing that’s that’s a challenge, but an opportunity is for some of these global employers We’ve been speaking with, they kind of go, Oh my gosh. You know, pay is defined as this for the purposes of the EU pay transparency director, but then we say, Pay is this, and then over here they’re talking about this, you know, what’s the right answer? And I think that’s where employers have a great opportunity to lean in and say, well, let’s just, let’s lay it out. Let’s say at our company, this is how we define pay. We’ve always talked about pay with you. This is your total rewards. This is how we think about it, in the context of your employee value proposition. This is what you know, our mission, our goals and how, how we value you. What you’re going to see Nancy is you’re sitting in France. France legislation requires the disclosure of data, and that’s how it’s going to be defined for the purposes of complying with, you know, the local legislation. But understand this is how it relates to how we think about it at our company. So I think it’s just making those distinctions, but but being more and more intentional, and making sure that you have a strategy for how you’re setting that up, how you’re scaling that education and those conversations internally with your employees, I think that’s where, that’s what we’re starting again. It’s all sort of in motion. It’s all happening right now.

Chris Dohrmann  22:40

So I think that brings us to my favorite part of the podcast, which is a rapid fire round. And this isn’t a press conference where we’re going to try and ask the question that you’re not ready for. This is part of the podcast that highlights your expertise in the most efficient manner. All

Lauren Jenkins  22:56

right. First question is, what’s the number one thing a company can do to prepare for? Pay transparency. It’s

Nancy Romanyshyn  23:02

a really good question. The number one, the first thing, I think I wish understand what you have. And by that, I mean I would say, Maybe another way to say it would be, don’t underestimate what pay Transparency means, and really think about it in a strategic way. So that means first understanding what what you do, what you have, what it means, how you’re defining it, how the world is defining it, really spend some time assessing and being planful and intentional around then what you’re going to do. Don’t just dive in. So I guess maybe it’s more of a Don’t, don’t just dive in. Don’t be reactive. Try to be proactive and strategic around it, and that’s going to serve you well.

Chris Dohrmann  23:52

You’ve addressed most of this already, but for listeners in the comp and benefits space, what three things can they bear in mind when they’re first addressing pay transparency,

Nancy Romanyshyn  24:01

putting, I think number one would be putting the employee at the center, making sure you’re always thinking from the employee mindset. I think that will really help orient you toward how you’re going to share information, making sure you’re setting just the right tone, and again, having that intentionality around how you’re communicating, all that you’re going to be communicating and educating, and how you’re going to invest in that education of your employees. Then the second thing I think, I’d go back to, you know, sort of that assessment, right? It’s, I think, assessing and pulling together the different stakeholders you’re going to have, looking beyond your your own immediate team, and recognizing that you’re going to have to bring leaders along. Leaders are going to be reluctant, or anticipate that they may be reluctant. This is a big change, so I think assessing and pulling together, say, a multi disciplinary team, to help you then you. Really get a handle on what is the scope and breadth of of what we’re going to have to do to meet all of this. And then I think giving, giving yourselves grace, I think would say, I’d say, that’s the third thing, knowing that this is a moving target. It’s evolving as we speak. And I think the more you’re thinking strategic about it, the more you’re thinking about it from the employee point of view, the better you’ll you’ll be able to then pivot as new things emerge and have sort of these, it’s, I’m going to sound very consultant speak, but having these guiding principles right in your brain that you’ll continue to go back to so that when this new law pops up, it’ll be like, Okay, let’s think about it within this context, this law is going to impact. Let’s see these stakeholder groups. Let’s immediately, let’s have a plan for checking in with them and then figuring out how we’re going to move forward. So I think it’s, it’s really around having, being planful and intentional, not reactionary. It’s very difficult, because you’re you’re changing things as you go. But I think that the good news is, you know, total rewards. Teams have a lot of these things in place. It’s just maybe framing them a little differently, thinking about them a little differently, and then being ready to share them. I would say, don’t be scared. We’re all scared. So I can’t really say, I know it’s not helpful to say, don’t be scared. But I would say, you know, what do they say? You know, courage is being scared and doing it anyway, kind of having that bravery. I think, as total rewards professionals, we’re always so worried. We perseverate on do we get the calculation right? Do we have the right amount of data? Do you know, analysis paralysis? This is not a time for that. The best thing you can do is just be vulnerable and say, so we’ve refined our ranges. They’re narrower than you’re used to. This is why we’re doing this. We’re being transparent. Yes, people are in different places in the range. I can answer most questions. I can’t answer all the questions, but I’m going to do my best to answer them for you. And let’s keep the dialog going. And these ranges may change too as we get more information, that’s what we’re doing. This is a I like to sometimes talk about it as like, almost like six sigma, like you’re we’re moving from a set it and forget it, kind of total rewards mentality when it comes to structures, to more of an ongoing, continuous improvement motion as we get more data, as we use different as new and different market data emerge, right? We have so many different sources. As we do better analytics internally, we’re going to continue to refine and hone what we’re doing, because we this is really important. So we do these analytics all of the time. I think leading into process versus the product is what’s really something that’s been successful at a lot of with a lot of the companies that we work with, where they talk more about the process, less about, say, the number or the range. It’s really how the process of how we got there, employees really appreciate that, because, again, it shows, yeah, we we take a lot of time and and we put a lot of thought into how we value what you do. So,

Chris Dohrmann  28:02

Nancy, you just mentioned data, and this happens to be at a time when AI and data cataloging and everything else is really at the forefront. Are your clients using the vast amounts of data to form the data ranges that they need?

Nancy Romanyshyn  28:18

I think what we find with our clients is, yes, in the sense that they’re what they’re doing is they are really leading in terms of using new and different sources of data. So we find, for a lot of our clients, I think it kind of in a binary kind of fashion. Sometimes there’s your external data and there’s your internal data. So your external data is, you know, when we think about market data, and we know that there’s been a huge and very rapid evolution around how we’re defining market we’re seeing a lot of our customers use the conventional, sort of typical surveys and information, but then also use things like, you know, applicant tracking, ATS data and offers data and what’s available sort of these different variations of I’m going to put in air quotations real time, because a lot of times they’re not real real time, but so they’re definitely looking into all of these different things and referencing them. I’m hearing more and more about that, but then the other part of it is the internal data, and I’m seeing certainly a lot of our customers, that’s exactly what they’re doing. Is they’re getting better around analyzing how they’re actually delivering pay in real time, and what can that tell them about what they should do next and how it informs pay decisions go forward.

Lauren Jenkins  29:37

So last question here, Nancy, can you sum up your philosophy on pay transparency in one sentence.

Nancy Romanyshyn  29:44

Let’s see my philosophy on pay transparency in just one sentence is just do it. Just do it. I do a workshop where I ask employers in the workshop. So what if tomorrow you woke up and everything was completely transparent, everything, everybody had access to all the information about all the employees, every bit, every bit of it. Hey, performance, ratings, job, everything, what are the first three things you do? It’s a great exercise. It’s a great mental exercise. You can get past the visceral like heart beating reaction to help you prioritize what you need to do to get ready. So and usually it’s one of three things. It’s I don’t know what. I don’t know things are broken. I need to do some assessment and analysis to really understand what’s broken, because I’m not sure what, but I know I have some ideas. Or it’s I know what’s broken. I need a chance to fix it before we you know, we go forward, or I feel okay about that. I’m actually pretty happy with what we’ve done, but I I want to lean into explaining it. I don’t know that we’ve explained enough of it, so we really need to focus on communication. It just really helps take this overwhelming concept and and bring it back to what is practical. There you there is no benefit to waiting. There is every benefit to do something, take one little step, do something, assess, do whatever it is, but just do it, because you’re just going to feel a lot better in the end. There’s much more upside to this than downside, and it truly can be exciting once you get past you know the fear and trepidation it can it’s a really exciting time to be a total rewards profession.

Chris Dohrmann  31:37

People need to remember what it was like to be a kid. Ripping the band aid off is always easier than just agonizing through it. Nancy, it’s been a real pleasure. Thank you very much for joining us on the podcast. Well,

Nancy Romanyshyn  31:50

Thank you so much for having me. It’s been so wonderful talking with you and I, I enjoyed this and all of our conversations at the next conferences that we bump into each other at.

Lauren Jenkins  32:00

Thanks so much, Nancy. And that brings us to the end of this episode of Prosperity at Work from JP Morgan Workplace Solutions.

Chris Dohrmann  32:06

Thanks for listening. If you’ve enjoyed this episode, we hope you’ll review rate and subscribe to JP Morgan Workplace Solutions Prosperity at Work, available wherever you get your podcasts.

Lauren Jenkins  32:18

You can find more insights on equity compensation, financial wellness and more by following us on LinkedIn or over at globalshares.com where you can also download our new global equity compensation report 2024.

Chris Dohrmann  32:30

Until next time, that’s Prosperity at Work. Bye!

Information provided in this podcast is intended for informational and educational purposes only. It may contain views which differ from the views of JP Morgan Chase and Company. For specific guidance on how this information should be applied to your situation, you should consult a qualified professional for full details. See the show notes on your podcast player right now.

Lauren Jenkins  32:54

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