Can Employers Fire Employees for Discussing Their Pay and Salary?

Many employers protect their worker’s salary and pay rates as tightly as they may protect company trade secrets. While the company leadership and any employee privy to staff pay rates should keep that information private, they cannot prohibit employees from sharing their own salary or pay rates with other employees or create any company policy that would prohibit employees from discussing their pay with others in the company. The National Labor Relations Board (NLRB) “expressly protects private sector employees rights to engage in any ‘concerted activity for mutual aid or protection’ and to ‘organize a union to negotiate with [their] employer concerning [their] wages, hours and other terms and conditions of employment.’” This protection was backed up by President Obama’s April 2014 Executive Oder which prohibits employers from retaliating against any employee that discloses their own compensation information.

The NLRB will defend an employee’s rights that may have been violated by their employer. In determining whether a certain activity is protected, the board considers these three questions:

  • Is the activity concerted?
  • Does it seek to benefit other employees?
  • Was it carried out in a reckless or malicious manner?

What does this mean for you as an employer? If you were to fire an employee that shares their compensation, and their conversation was later found to be protected under the NLRA, you could be required to reinstate the employee and/or provide back pay.

This NLRA protection extends to employee’s social media as well. So, while it might be tempting to discipline an employee for tweeting that his supervisor is a bully or for posting on Facebook that they are overworked and under paid, or what their compensation is doing so may violate the law. The NLRB does not restrict employers from disciplining employees for social media content that may violate other legal company policies. However, before administering any corrective action against an employee, always conduct a thorough investigation and consult with an HR professional to ensure all HR best practices are followed.

Often, organizations are able to avoid these and other issues that can work to create a negative company culture by following these HR best practices:

  • Pay employees fairly and make sure salaries are competitive in the marketplace.
  • Encourage a friendly workplace where employees are comfortable broaching sensitive subjects such as pay with management and HR.
  • Provide training and development opportunities so employees can learn additional skills which could bring growth and promotional opportunities.
  • Provide a complaint resolution procedure to allow employees to be heard.
  • Conduct internal survey to monitor working conditions, employee morale, engagement and compensation expectations.

A company’s employees are their greatest asset and an organization can only progress when there is a mutual trust between the two. With guidance from HR professionals like Exodus HR, sensitive topics like discussing pay and other HR issues can be easily navigated. If you have any questions on your companies HR policies or how to correctly handle any HR issue please contact us we look forward to helping you with your HR needs.