Earlier this month, we conducted a poll on pay secrecy and discovered that nearly 60 percent of surveyed tech employees are discouraged from discussing compensation with other employees.
In most cases, federal and state labor laws prohibit companies from imposing pay secrecy rules or retaliating against employees who discuss their compensation with co-workers. The reason being: Pay secrecy can foster wage discrimination based on gender, ethnicity, or age. Yet despite the laws, some companies uphold pay secrecy policies, whether written or implied. It’s not uncommon to find that both workers and employers are unaware of an employee’s right to openly discuss salary information.
The National Labor Relations Act (NLRA) is just one labor law that fosters pay transparency. In this post, we outline what rights the Act guarantees, who it protects, and what happens to companies that violate the Act.
What the NLRA Protects
Under the NLRA, employees can organize and collectively bargain to improve their wages, benefits, or working conditions. Employees can organize with a union or choose to engage in protected concerted activities, which is “when two or more employees take action for their mutual aid or protection regarding terms and conditions of employment.” The Act also gives employees the right to abstain from both union activities and protected concerted activies.
Examples of protected union activities include:
• Forming a union
• Joining a union (whether or not the union is recognized by the employer)
• Assisting a union to organize other employees
Examples of protected concerted activities include:
• Two or more employees speaking to their employer about improving their compensation
• Two or more employees discussing safety concerns or other work-related issues
• An employee speaking to an employer on behalf of one or more co-workers about improving workplace conditions
Who Is Covered
The NLRA protects most employees in the private sector but there are exceptions. According to the National Labor Relations Board (NLRB), the Act excludes the following people:
• Federal, state, or local government employees
• Agricultural laborers
• Domestic service workers employed in any person or family’s home
• Workers employed by a parent or spouse
• Independent contractors
• Workers employed by companies subject to the Railway Labor Act
• Workers employed by any person who is not an employer as defined in the NLRA
Another exception includes people who have access to a company’s payroll. These employees are prohibited from sharing other workers’ private salary information without consent.
What You Can Do When Your Rights Are Violated
You can contact the labor board and file a complaint. The Board may investigate and initiate a case against your employer. In recent years, Circuit Courts have decided about 65 cases per year involving the NLRB and nearly 80 percent have been decided in the Board’s favor.
You may also want to retain an attorney with experience in labor laws, especially if you’ve faced retaliation from your employer for discussing salary information.
What Happens to Companies That Violate the NLRA
Companies who are caught violating your rights may be ordered to provide you with lost wages. And if you are unfairly or illegally fired, the company may be ordered to offer you your old job back.
These consequences are neither severe nor costly, so some employers may not think twice about encouraging pay secrecy in the workplace. Because of this, some employees have voiced that there needs to be better enforcement of labor laws and appropriate punishment for companies.
The NLRA isn’t the only labor law that supports pay transparency. Executive Order 13665 guarantees federal employees the right to discuss salaries and wages. The California Equal Pay Act affords the same rights on a state level to certain employees. You can learn more about the protections these laws offer by visiting their websites.
Pay secrecy can be a sign of discrimination and can provide employers with too much power when deciding compensation offers. In order for workers to come to the table and decide fair pay scales with their employers, they need to understand their working conditions, and they need more transparency about salaries and wages.