Preventing employees discussing their salaries

01 July 2019

This article was featured in the July/August 2019 issue of the magazine.

Danny Done, managing director at Portfolio Payroll, discusses the issues and offers advice

The thought of staff openly discussing salaries with each other can sometimes be uncomfortable for their employer, as such discussion has the potential to cause significant unrest within the organisation. For this reason, you may look to actively prevent or discourage salary discussions at work by implementing a number of measures. 

Perhaps the most obvious way of preventing staff from discussing their salaries would be to implement a salary, or pay, secrecy clause in their contract of employment. These clauses can be constructed to explicitly outline a requirement for staff not to mention their pay at work or risk facing disciplinary action. This provision should be fairly easy to include in all future contracts; however, you should approach with caution when looking to apply this to current staff. It is unlikely that any added restrictions will be well-received, and they could be difficult to introduce depending on the result of the required consultation period. 

You also need to bear in mind that there are limitations to any pay secrecy clause as it will be unlawful to prevent employees from disclosing a difference in salary, if they are trying to ascertain whether an equal pay issue between male and female workers exists. This exemption means you would be unable to enforce pay secrecy clauses in this situation and any attempts to discipline staff could result in claims of victimisation if they can prove they were trying to identify an equal pay issue. Also consider that staff may be able to use equal pay as a fall-back excuse if they are ever caught discussing salaries, even if this was never their intention. 


...trying to ascertain whether an equal pay issue between male and female workers exists


At the same time, if you do find that staff are openly discussing pay you should consider where there may be scope for any equal pay claims. Remember that individuals do not necessarily have to work in the same role as a comparator to make an equal pay claim and may do so if the work is rated as equivalent or of equal value. Therefore, it is advisable to review your pay practices in these situations to ensure all staff are paid appropriately for the work they do. 

Given the risk associated with pay secrecy clauses, you could look to take a softer approach to discourage salary discussions at work. Simply advising staff against discussing salaries during their inductions and any annual pay reviews may prove equally effective, especially when dealing with inexperienced staff who may be unaware of how sensitive the topic of pay can be at work.

Employees may be more understanding of this request, especially if it is explained that this is for the good of the working environment and to prevent any unnecessary unrest at work. 

It is fair to say that part of the intrigue for staff when it comes to discussing salaries is the prospect of finding out information that they were otherwise unaware of. Therefore, one way of preventing pay discussions would be to increase transparency around your organisation’s pay practices. However, rather than broadcasting each individual’s personal salary, you could introduce a ‘pay banding’ system so that staff have a sense of what salary comes with a particular job role, thereby dispelling any worries about unequal pay practices. 

You should also remember that pay will always be an important and sensitive point for many employees and there may be times where individuals feel the need to raise concerns over their pay. In these situations, it is important that line managers and human resources personnel remain open and approachable, giving staff plenty of opportunity to discuss their concerns in a confidential manner without needing to talk about this between themselves. 

Ultimately, whilst you may be concerned at the prospect of employees discussing their salaries at work, you should keep in mind that you will have nothing to fear from this as long as your pay practices are fair and non-discriminatory. At the same time, you can look to discourage any discussions if you are concerned of the negative impact this will have; and staff are far more likely to be receptive to this if they are comfortable that your pay practices remain fair.