The role of salary transparency in reducing workplace inequality

The global conversation around pay in the workplace has shifted significantly in recent years, with salary transparency becoming a central topic in job markets across the Asia Pacific. What was once considered off-limits or even taboo is now increasingly seen as a step toward building fairness and equity in the workplace.

This isn’t a passing trend. Employers and employees alike recognise that open conversations about salary can help address inequalities and create a more level playing field for everyone.

While the specific regulations and cultural attitudes towards pay transparency vary from country to country, the overall movement towards greater openness is gaining momentum throughout the region.

What is salary transparency?

Salary transparency refers to the practice of openly sharing information about pay. This can range from listing salary ranges in job ads to providing detailed pay scales across an organisation. It encompasses various levels of openness, from sharing basic salary ranges in job postings to full transparency where all employees' compensation details are accessible internally. This approach represents a significant shift from traditional practices where compensation discussions were often considered taboo.

Benefits of salary transparency

Against this backdrop of changing attitudes, salary transparency offers several key benefits while working toward crucial workplace goals:

1. Enables organisations to craft competitive compensation packages that attract top talent
2. Helps build a positive employer reputation
3. Fosters a sense of trust and open communication among employees
4. Saves time and resources for both job seekers and employers
5. Leads to more effective candidate filtering
6. Empowers employees to negotiate fair wages
7. Helps reduce pay disparities based on gender, race, or other factors
8. Increases employee satisfaction and retention
9. Streamlines the hiring process
10. Leads to more focused and productive salary discussions

Current market practices in Hong Kong

While salary transparency is gaining attention globally, its implementation varies significantly across Hong Kong's market. “We also have clients specifically asking us to remove salary ranges from advertisements,” notes Olga Yung, Managing Director at Michael Page Hong Kong.

She adds: “This is mainly due to the hires at times related to replacements whether it is someone who is moving on from the company or relocating to another role within the company. Generally, larger corporations/conglomerates prefer salaries to be confidential and do not want their staff to see what the salary ranges are.”

The practice of including salary information in job postings varies significantly across different market segments. As Rupert Forster, Senior Managing Director at Michael Page Greater China, observes, this variation depends on several key factors:

• Company type (large multinationals vs. SMEs)
• Origin (domestic vs. foreign companies)
• Industry sector (specialist markets like Financial Services vs. more general sectors)
• Job level (junior vs. senior positions)

From a recruitment perspective, Michael Page consultants take a nuanced approach to salary disclosure.

“We do not insist on this if they do not want it. Given how sensitive conglomerates and Hong Kong corporates are about salaries on ads these days, we do take an extra step to ask if we can include salary ranges in the ad (and we will explain including such information draws in more candidates),” explains Olga Yung.

In Hong Kong’s highly competitive job market, salary transparency has become a strategic tool for companies aiming to attract and retain top talent. As professionals increasingly seek clear compensation structures and equitable pay practices, transparent salary information helps distinguish employers and build trust.

With a strong emphasis on financial security and career advancement in Hong Kong, providing upfront salary details can set companies apart, streamline the recruitment process, and attract candidates looking for clarity and fairness in their employment terms.

Platform requirements and market practice

In Hong Kong, job platforms encourage salary transparency, though actual practices vary. A 2022 report by JobsDB by SEEK highlights that 30% of respondents in Hong Kong will first look at the salary information in a job advertisement. 

Addressing gender pay gaps

The gender pay gap is the difference in average earnings between men and women in the workforce. It is typically expressed as a percentage of men’s earnings and can be influenced by several factors, including occupational segregation, caregiving responsibilities, and educational background.

The current state of gender pay equity

According to the Hong Kong Talent Trends 2024 Report, many employees have mixed feelings about their employer’s efforts to address pay equity, highlighting the need for ongoing attention.

Some 23% of women are satisfied with their employers’ efforts to close the gender pay gap; 27% are dissatisfied, 37% are neutral, and 13% are uninterested. The survey also revealed a significant disparity in DE&I priorities between men and women.

‘Closing the gender pay gap’ was ranked as women’s most important DE&I initiative but only a fourth priority by men. It’s crucial to understand that the gender pay gap is not a simple matter of unequal pay for equal work, which is illegal in many countries.

How pay transparency tackles pay disparities

The gender pay gap is a complex issue, deeply intertwined with broader structural inequalities in the labour market. These include bias in hiring, promotion, and compensation decisions, and the underrepresentation of women in senior, higher-paying positions.

Promoting salary transparency helps level the playing field by:

• Empowering women and other underrepresented groups to negotiate fair wages
• Providing clear pay structures, enabling employees to advocate for themselves
• Reducing the likelihood of accepting less than deserved due to lack of information

Empowering employees through transparent pay

The practical implementation of salary transparency creates tangible opportunities for employee empowerment. When organisations provide clear access to compensation information, employees can:

• Make more informed career decisions
• Better understand their market value
• Develop clearer career progression paths
• Take a more active role in their compensation discussions

Effective implementation typically involves:

1. Providing clear salary bands and progression criteria
2. Offering regular market benchmarking updates
3. Creating structured processes for compensation reviews
4. Ensuring consistent communication about pay policies

When organisations successfully implement transparent pay practices, the impact extends beyond individual employees. Teams experience:

• More productive compensation discussions
• Increased trust in leadership decisions
• Greater understanding of career development opportunities
• Improved collaboration and reduced pay-related tensions

From a recruitment perspective, clear salary information helps candidates make informed decisions earlier in the hiring process, leading to more efficient and focused discussions about career opportunities and professional growth. While the benefits of transparent pay practices are clear, organisations often face implementation challenges that require careful consideration and strategic planning.

Action steps for employers and employees

Embracing salary transparency isn’t just about compliance – it is about fostering trust, fairness, and engagement in your organisation. Here's how both employers and employees can take meaningful steps towards greater pay transparency while addressing common challenges:

For Employers

1. Conduct a pay equity audit:

• Use data analytics to identify and address unexplained pay gaps.

2. Develop a clear compensation philosophy and structure:

• Clearly define how pay is determined, including factors like skills, experience, and performance.
• Communicate this structure to all employees to ensure understanding and buy-in.

3. Train managers on discussing pay transparently:

• Equip leaders with the skills to have open, constructive conversations about compensation.
• Include training on handling difficult questions and addressing pay discrepancies.

4. Gradually increase transparency:

• Start by including salary ranges in job postings.
• Progress to sharing pay bands for internal roles and eventually consider full pay transparency.
• Case study: Buffer’s full pay transparency policy has led to increased trust and an increase in job applications.

5. Consider platform-specific strategies

When posting job advertisements, consider that different platforms and markets may have varying requirements and norms regarding salary disclosure.

Additional market considerations

When implementing these steps, consider:

• Role seniority: Adjust transparency levels for different job levels
• Industry standards: Consider sector-specific compensation practices
• Platform requirements: Comply with job board policies on salary disclosure
• Company culture: Ensure alignment with organisational values and goals

For Employees

1. Research industry standards:

• Use resources like Glassdoor and salary guides to understand market rates for your role and experience level.

According to our 2024 Candidate Pulse survey, job applicants in Hong Kong primarily rely on these top three sources for the latest salary information, in order of preference: first, salary reports; second, job advertisements; and third, recruitment agencies.

2. Initiate conversations about pay transparency:

• Respectfully ask your HR department or manager about the company’s stance on pay transparency.
• Suggest anonymous salary surveys or the creation of pay bands as initial steps.

3. Advocate for clear communication:

• Request regular updates on the company’s compensation philosophy and practices.
• Encourage leadership to share how pay decisions are made, even if specific numbers aren’t disclosed.

4. Support colleagues in discussions about fair pay:

• Share industry salary information with peers (where legally and ethically appropriate).
• Advocate for equal pay for equal work across all demographics.
• Commit to taking at least one step towards greater salary transparency in the next 30 days. Whether you’re an employer or an employee, your actions can contribute to a more equitable and transparent workplace.

Challenges of Implementing salary transparency

While salary transparency brings numerous benefits, it also presents challenges for employers. Transparent pay structures can lead to internal dissatisfaction if employees perceive wage discrepancies, potentially impacting morale and engagement.

On top of that, sharing salary ranges publicly may spark wage competition among companies, making it challenging for businesses to retain top talent without continually adjusting compensation levels. Implementing transparency requires thoughtful planning to maintain fair compensation and clear communication to ensure employees understand how pay decisions align with experience and performance.

The future of salary transparency in Hong Kong

As Hong Kong's workforce continues evolving and aligning with global standards, the push for pay transparency will likely grow. This shift addresses pay equity and positions companies as progressive and employee-focused, which is increasingly important in today’s competitive job market.

Emerging trends on salary transparency

As the landscape of work continues to evolve, we can anticipate several key trends in salary transparency:

AI-driven fairness: The increased use of generative AI and data analytics will play a pivotal role in identifying and addressing pay disparities, ensuring fairer compensation practices.

Transparency as a competitive edge: More companies will recognise the benefits of transparent pay practices as a means to attract and retain top talent, fostering a positive employer brand.

Regulatory push: There is a growing likelihood of stricter legislation mandating greater pay transparency, particularly for larger corporations, reflecting a societal shift towards greater fairness in the workplace.

Moving towards a fairer workplace

Salary transparency is a powerful tool in the quest for workplace equality. By embracing this approach as part of retention strategies, organisations can promote accountability, build trust, and empower employees to advocate for fair pay.

As recruitment professionals, we have a unique opportunity to champion these changes, supporting employers and employees in creating more equitable workplaces.

Explore our job listings and the annual salary guides to stay informed about current salary trends and benchmarks. By fostering transparency in pay information, we can contribute to Hong Kong’s fairer and more inclusive job market.

Explore salary insights

To get a comprehensive view of salaries and market benchmarks across various industries and roles in Hong Kong, download the full 2024 Salary Guide, which features the average salary of roles in Hong Kong's dynamic job market, or use our Salary Comparison Tool to see how your compensation compares to industry standards.

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