Where do you stand on mandatory paternity leave? What about publishing everyone’s salary at the office? For this special debate-style episode, Xenium’s Angela Perkins and Brandon Laws randomly selected hot button HR topics and then picked a side to debate the issue. Listen in as they argue for and against mandatory paid maternity and paternity leave, whether in-house HR or HR outsourcing is best, and the pros and cons of radical pay transparency.
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Brandon Laws: Welcome to Transform Your Workplace. I’m your host, Brandon Laws. We’ve got a special episode. I’ve got my boss, Angela Perkins.
Angela Perkins: Hi, Brandon.
Brandon Laws: We’ve got a really fun episode. We don’t know how this is going to go because I just came up with this idea randomly and I think we’re both a little nervous for this, that …
Angela Perkins: We’re just going to publicly argue. I don’t know.
Brandon Laws: Yeah. We are going to argue. The last episode we did together was on DISC and we kind of just threw everything out there about our working styles and all that. This one I think kicks it up a notch. It’s not really about us but we are going to debate live on this podcast. We’ve got three topics and how I’ve structured this is we’re going to pick a topic. We will do it right here on the podcast and then I will have you pick who’s going to go first and then who is going to argue in favor of or against.
So I want to preface all of this and you can jump in too, Ang. This is without our opinions really. We are going to basically pick a side and we’re going to try our best to stick to that side. But knowing that we do have our own opinions that we may be arguing against, it might be hard to stay in character. So anything you want to add to that?
Angela Perkins: We will just – we will kind of wing it and we will see. But first of all, I do need to know. Were you on the debate team? I need to know what my competition is right here. So are you going to like just blow me out of the water with your side?
Brandon Laws: I don’t think so, no.
Angela Perkins: OK.
Brandon Laws: I can get opinionated and I liked debating politics a while back. But then I started avoiding it altogether.
Angela Perkins: Sure, sure.
Brandon Laws: So this will be a little different.
Angela Perkins: Yeah. We will definitely stay away from that topic.
Brandon Laws: Yeah. I will just say the topics that we’re going to do, so people can see if it’s a fit for the conversation if they want to listen or not. So we’re going to do three topics today and we’re going to pick randomly in no particular order. So we have mandatory paid leave for maternity and paternity leave, mandated by the government. That’s topic number one.
Topic number two will be complete pay transparency or radical transparency. Like basically publishing people’s salaries on the wall. You know what I make. I know what you make, that sort of thing. And then the last one which we may end up drawing first is in-house HR or outsourced HR and we’re going to have to argue one side or the other. OK? Are you ready?
Angela Perkins: I’m ready.
Brandon Laws: Hopefully the listeners are ready for this. This could be awkward. It could be fun. Let’s see. OK, I’m going to have you pick a topic. Let’s go.
Angela Perkins: OK, here we go. We got three pieces of paper here. I’m going to pick this guy and here we go. What is it, Brandon?
Brandon Laws: Mandatory paid leave, government-mandated.
Angela Perkins: OK. So that’s the topic.
Brandon Laws: I will pick the next one.
Angela Perkins: OK.
Brandon Laws: And then you pick the last one.
Angela Perkins: OK.
Brandon Laws: So I’m going to go second.
Angela Perkins: OK. So that means I’m going first and my stance on this is I’m against. So I am against mandatory paid leave.
Brandon Laws: OK. So you’re against mandatory paid leave.
Angela Perkins: And I’m going to go first.
Brandon Laws: You’re going first. Let’s go.
Angela Perkins: OK, all right.
Brandon Laws: Should we have a clock? I don’t know. We don’t need to have a clock. Just make your point.
Angela Perkins: I’m not so sure about this first, second thing either. So kind of jump in there because a good debate is sort of a back and a forth. So we will kind of – I’m going to just kick off with my against argument, which I’m just randomly pulling together in my brain right now.
Brandon Laws: Are you sweating?
Angela Perkins: I’m a little nervous. Let’s see how I can do. So here’s the thing. We have small to mid-sized business owners listening to the podcast hopefully and they’re sitting in their cars and they’re wondering how they’re going to make payroll with all of the growing expenses of wages for their team. Benefits are going up double digits every year in terms of medical and dental and all of that. They’ve got business expenses in terms of their equipment and their building and then we get a layer on mandatory paid leave.
So here’s what I would say about that. It’s really important for an employer to be able to provide pay – competitive pay – and get a product out the door or service out the door, whatever their business is and if they’re also paying folks that aren’t sitting in that business, that’s just – it’s very expensive.
So it’s managing an expense that is invisible. You have the money going out the door. You don’t have the staff resource sitting there because they’re on paid leave and this is not judging – I’m a mom. So this is not judging the fact that that mom time or dad time, super, super important. But who should fund it? The employee should save and prepare themselves for time away from work.
Brandon Laws: It’s a legitimate argument. I think what you’re missing in this – starting to get snarky. I think what – the argument to this is that much like health insurance, are people going to be able to fund that on their own? And I think employers have the opportunity to be the vehicle in which they can offer and change people’s lives. I think we have a crisis right now of – I’ve read some stats recently. I swear I didn’t prepare for this whatsoever.
Angela Perkins: You are going to spit out stats right now?
Brandon Laws: No. This is going to be this whole generality. I think I read somewhere that literally, people aren’t having enough babies. So the demographics may change or you may not – like as we have an aging population, you’re not going to have enough babies to like basically eclipse or even match the demographic and you can see a problem with that when you have – you’re talking about pensions and Social Security and things like that. These funded liabilities will become an issue if you don’t have kids.
So if employers don’t step in and make change where they can – where the government mandates paid leave, where they – like somebody could be out for three months after having a baby. It could change their life because most people cannot afford to live and also save enough money to be out for three months. It’s absolutely crazy.
Angela Perkins: Sure.
Brandon Laws: So employers should be responsible for it.
Angela Perkins: OK. So where do they find those funds to afford this salary, effectively going out the door, while they also need to hire potentially a temporary employee to come fill that gap for 90 days? Where do they find those funds?
Brandon Laws: Yeah. So you bring up a good argument. I did a lot of study on inflation and you can’t just raise prices.
Angela Perkins: Right.
Brandon Laws: Although you kind of have to in this case. So I think if employers adopt this faster and raise prices and make this a benefit before the government mandates it, then I think they could be ahead.
Angela Perkins: Sure.
Brandon Laws: It could be a – I think if you get ahead of this, then you become an employer choice. So there’s a benefit on that side. But once the government mandates it, I think you really have to – I think you have to change your business ahead of time. You have to raise your prices. You have to shift salaries and I think the other thing is not everybody is going to have kids too.
Angela Perkins: Sure, right.
Brandon Laws: So maybe – obviously I don’t want to discriminate. But you would need to probably change some of your practices from a – if somebody is not having kids, what kind of benefits would they want if they’re not going to use that mandatory paid leave?
Angela Perkins: That actually brings up another point to my argument in my against flyer here that I have that I’m against this topic. So if I’m an employer, this actually happens a lot in regular benefit offerings. So if an employer is paying 100 percent only for medical coverage and I’m an employee and I opt out of that, then sometimes I come to my employer and say, “Hey!”
Brandon Laws: What’s up –?
Angela Perkins: I’m saving you $600 a month. Can you increase my – so I could actually foresee this paid leave thing coming up, creeping up into the culture. If not rolled out appropriately to cause a potential rift between employees, right?
So if you go on leave, Brandon, and you leave me and you’re – I know you’re hanging back with your baby and you are making just as much money as you were maybe – you know, depending upon the state, it’s a percentage or whatever the case is.
So you still have dollars coming in the door. But I’m here now stuck with your workload. I’m not going to have babies, let’s say, and so then I’m going to go to my employer and say, “Hey, I’ve got double the work going on. Now I want maybe a higher pay rate or …”
It’s just – it’s very complex. I do – I will tell you this. I agree with your point in employers getting ahead of this because we’ve seen this happen with sick leave and even the wage increases, the minimum wage increases, the employers that have jumped up in advance of this have fared better because their employees can recognize that they’re actually doing it on their own.
Brandon Laws: Exactly, yeah.
Angela Perkins: I mean technically they’re nudged along because they know it’s coming.
Brandon Laws: Yeah.
Angela Perkins: But I would say that if we see it coming for the state that we’re in, the employers will be better off to jump in early versus being a late adopter.
Brandon Laws: For sure. And I think the benefit in all this too is if – you know, kind of like paid sick leave and things like that, is the government usually mandates something that’s lesser than what they already offer.
I mean a lot of employers are obviously not offering. That’s the whole point.
Angela Perkins: Right.
Brandon Laws: But let’s say – a bigger company obviously could do this because they have the funds. But if like the Googles of the world or the Facebooks, they have the cash, they’re like, “OK, paid leave up to three months,” right?
Angela Perkins: Yeah, yeah.
Brandon Laws: Fully paid. Come back when you’re ready after three months. The government is probably not going to do that because most employers can’t. They will probably figure out a way to do like a paid leave mandatory up to a month.
Angela Perkins: Sure.
Brandon Laws: Or three weeks or something that’s at least a buffer because parents have to be with their kids.
Angela Perkins: Absolutely.
Brandon Laws: You can’t go back to work after a week, especially moms.
Angela Perkins: Right.
Brandon Laws: You can’t do that.
Angela Perkins: Right, right. Having a really hard time not jumping over to the other side.
Brandon Laws: Me too, because I’m like – I want to argue on it. There are points – I think the whole point of this podcast – I’m breaking character right now. The whole point of this is that it’s – even though we’re so polarized in the world that we’re in, you could easily argue both sides.
Angela Perkins: I think that’s a healthy way to go about it too because there are always positives and drawbacks to really anything in business, in life. So to see both sides is really important.
Brandon Laws: Yeah. I think it’s important. So we will call that a tie maybe.
Angela Perkins: Maybe a tie.
Brandon Laws: You argue it way better.
Angela Perkins: I don’t know, I don’t know, because I’m leaning your way. So maybe a tie is …
Brandon Laws: I was leaning your way. You’re just so precise and manipulative.
Angela Perkins: Hey, hey.
Brandon Laws: OK. I will pick the next topic. How about that?
Angela Perkins: OK.
Brandon Laws: And then you pick the …
Angela Perkins: Perfect.
Brandon Laws: Is this the – wait. OK. Let me grab the topic. Next …
Angela Perkins: I want to …
Brandon Laws: The next one, oh, you will like this one. Outsourced HR or in-house HR.
Angela Perkins: OK.
Brandon Laws: Interesting.
Angela Perkins: So I will choose the – what’s this? There’s only one left of this. This is the first and second – oh, there we go.
Brandon Laws: Oh, wait. No, that’s not right. I don’t know.
Angela Perkins: So there’s the first. Is there a second there? That’s a new topic.
Brandon Laws: OK. So leave the topic over there.
Angela Perkins: OK.
Brandon Laws: Here’s first and second.
Angela Perkins: OK. OK. So I’m going to choose whether I go first or second and I got second.
Brandon Laws: All right.
Angela Perkins: So you got to go first. OK. And then …
Brandon Laws: OK. And then you pick this one.
Angela Perkins: Are you sure?
Brandon Laws: Yeah.
Angela Perkins: OK. This is whether I’m for it or against it.
Brandon Laws: You’re against.
Angela Perkins: This is terrible. OK. All right.
Brandon Laws: Hold on. Actually, I screwed all this up. So in-house HR versus outsourced HR.
Angela Perkins: Yes.
Brandon Laws: You’re against it. Let me do that. Yeah, which. I will do you a favor. You’re going to argue in favor of outsourced HR.
Angela Perkins: OK, OK.
Brandon Laws: How about that?
Angela Perkins: I like that.
Brandon Laws: And I will take – I want to play – because you’re the sales gal on outsourced HR.
Angela Perkins: Sure.
Brandon Laws: You’re good at what you do. So this will give you a –
Angela Perkins: Well now you’re putting like higher stakes on this whole thing, right?
Brandon Laws: Well, what’s interesting because I’m an in-house marketer for Xenium which is an outsourced HR.
Angela Perkins: OK, OK, yeah.
Brandon Laws: As an in-house person, I think you’re going to have the perspective.
Angela Perkins: Perfect. OK, let’s go. Yeah, I like it.
Brandon Laws: OK. So here we go. In-house HR versus outsourced. I’m taking in-house stance. You got outsourced.
Angela Perkins: Yeah.
Brandon Laws: OK. The reason why you would absolutely want in-house HR is that you need somebody there all the time, somebody who’s embedded in the culture, somebody who knows you inside and out, who knows the people. It’s like there’s Joe. He gets a cup of coffee at 9:00 AM every single day and I have a – I know Joe and I know the tendencies of the organization. I’m so aligned with the vision, the purpose of the company. How is an outsourced company going to do that? They’re disconnected from the culture and I think you need somebody there all the time and depending on the size of the organization, if you just keep hiring in-house people all day long, you have different people that have different areas of the function.
So you have somebody doing employee relations. You have somebody doing –
Angela Perkins: Well, it sounds quite expensive, Brandon.
Brandon Laws: It does sound pretty expensive. It is. But it’s worth it because you get people that are there all the time.
Angela Perkins: OK.
Brandon Laws: You can rely on.
Angela Perkins: Yeah.
Brandon Laws: And they’re one of you.
Angela Perkins: OK.
Brandon Laws: That’s all I got.
Angela Perkins: OK.
Brandon Laws: Can you go –?
Angela Perkins: Well, I do have to tell you that one of your in-house people is just now out on paid maternity leave. So I’m not really sure where you think this “there all the time” thing is going to – no, I’m just kidding.
So here’s the thing with there’s some benefits to in-house. But I want to flip this back in a question to you. You’re a leader here at Xenium. Who’s responsible for culture?
Brandon Laws: The people are.
Angela Perkins: OK. But you said that you need to have an HR person on site all the time to lead culture and to know everybody and to know that Joe has coffee at 9:00.
Brandon Laws: I think somebody has got to own it and I think HR can own it. I think it’s leadership –
Angela Perkins: And they have to be in the building 40 hours a week in order to own culture.
Brandon Laws: Yeah.
Angela Perkins: OK.
Brandon Laws: I think they need to be. I think they need – it has got to be somebody who owns it all the time and can police it a little bit.
Angela Perkins: Interesting. OK. So let’s – I’m going to just for two seconds define outsource so that everyone sort of knows what I’m even talking about. But this is really just managing HR as a third party. So as a service deliverable versus having a hired person with the title of HR manager or HR director and for the most part, it’s small to mid-sized businesses that are looking to these two models as a choice because as you get bigger, having a built-out department that you sort of were describing – you know, somebody who’s leading employee relations, somebody who’s leading benefits, you can afford that the larger you get and there’s a full-time job in those specialties.
For most small to mid-sized businesses under 100 employees let’s just say, it’s really difficult to have full-time resources in all of these different specialties and that’s what HR is. You can call it a generalist all you want and it really does have to operate as a generalist function when only one person is doing it.
So the case for outsourced is you get so much more bang for your buck when you are able to get to a service delivery in compensation, in VP level to admin and everything in between in a service delivery instead of in a person.
So I really feel strongly about the culture piece because I’m a leader here at Xenium. I lead a team. I’m part of the executive team. I feel responsible for the culture and if you told me that I needed to go talk to Stephanie who is our support – kind of supports the HR infrastructure here at Xenium, if I have to go down to her desk and say, “Hey, Steph, there’s something going on culturally and you need to go deal with it,” I have a real problem with that.
So for me, when I talk to customers about culture and I really just need someone sitting here so employees can come to talk to them, that’s a leadership development opportunity. So that is building up your leader so they can handle their teams and management teams.
Brandon Laws: That’s an interesting point.
Angela Perkins: Particularly, I’m specifically talking about SMB, so small to mid-sized.
Brandon Laws: Yeah. So on that point, I think leaders are busy with their own people and there are so many processes and practices that HR needs to roll out and own and develop and you’re going to put that on leaders to – and middle managers to do that because I think they’ve already got big jobs and you need somebody in-house to completely own it.
Angela Perkins: Yeah.
Brandon Laws: To roll it out.
Angela Perkins: So I agree with you. Leaders can’t do that. That’s the part that’s the infrastructure and where better to go than a company that does it for 400 companies, right? So versus one person who their own bias is going to say I saw performance management handle it this way at my last company. So I’m going to just take those forms that I put on a flash drive before I left my last employer and I need to go plug them in and I’m going to roll them out here or I’m going to go to a BOLI conference or an HR compliance conference and I’m going to grab something from there and I’m going to roll it out versus it being more of a diverse – HR outsourcing companies, that’s all they do. It’s no different than going to an accountant for the accounting expertise when you as an individual – do you use a CPA to do your taxes?
Brandon Laws: Uh-huh.
Angela Perkins: No different. So you could go – I mean the free, free, free ads, oh my goodness, that are driving me nuts with –
Brandon Laws: Oh, driving me crazy. Well, it should be over now. It’s after …
Angela Perkins: I think they, yeah, went all the way until April 15th. But anyway, so you know, you could go do that. But why wouldn’t you hire the experts so that you have the layers of expertise when you need it? You’re not paying 40 hours a week for it because you don’t need VP level all the time. You don’t need generalist level or admin level. But the process, the procedure, the best practice around how to roll out in our next topic is going to be this pay transparency piece. What a great thing to have a service sort of …
Brandon Laws: That you could rely on, yeah. I get what you’re saying. I think it’s really going to depend on the size of these organizations because I could see where outsourced is probably good on the – I don’t know. Kind of like the dumbbell approach where it’s like the really, really small where they’re – you have no need for an in-house HR person. So maybe it is like middle management leaders dealing with it or you just hire some outside help.
Angela Perkins: Yeah.
Brandon Laws: Because you really have no need for a full-time person.
Angela Perkins: Yeah.
Brandon Laws: I get that where – and then at the upper end, it’s like you have probably so many people that you do need in-house people all the time. Well, here’s where I will compromise with you on this topic.
Angela Perkins: OK, OK.
Brandon Laws: As I think augmentation at that level where you get to a certain point, you still need in-house people owning it. Sure, outsourced, resources could wrap around that because like I do that in marketing. I’m in-house and then I hire freelancers, agencies to wrap around me. But I own it.
Angela Perkins: Yeah.
Brandon Laws: Right?
Angela Perkins: Yeah.
Brandon Laws: OK. So then at the middle level, this is where I’m disagreeing with you. I’m staying in character –
Angela Perkins: I really hope you’re not, but yes.
Brandon Laws: I’m staying in character.
Angela Perkins: OK.
Brandon Laws: So at the mid-level, there are 50 employees to 100.
Angela Perkins: Yeah, yeah.
Brandon Laws: This is where I’m like – you’re in growth mode. You need somebody there all the time.
Angela Perkins: OK.
Brandon Laws: Building out processes and knowing the people and building the culture.
Angela Perkins: Yeah.
Brandon Laws: What do you say to that?
Angela Perkins: So I mean I – here’s the thing. I don’t think – as much as we even at Xenium try to come up with this magic number of employees where this is the golden ticket, it all depends. It depends on are you growing. Is it this fast growth mode and you’re 50 employees now but you’re going to be 150 in six months because you just got huge – like all of these things matter.
It also matters what is HR because it’s different company to company to company.
Brandon Laws: Yeah.
Angela Perkins: Like define that for me. Is this compliance and chasing you around or is this – right? Or is this true culture support and you’re working on leadership development? As the HR leader, you’re helping support the supervisors at every turn. So I don’t know that there’s like clearly a yes if you’re 76 employees and more. Then you need this in-house. You really have to – I think it’s crazy not to augment no matter what size you are because you cannot possibly have a Suzi Wear on your team who is a guru in leadership coaching and training and development of leaders, right? She’s on Xenium’s team and if she could be a piece of every client’s leadership group, they are better for it. So why not leverage? Similar to what you were just saying where you are augmented by these freelancers. You know what to push on each of those individuals.
I think your question specifically is, “What if there wasn’t a you?” Right? Here at Xenium, as an example. How would that work?
Brandon Laws: Yeah.
Angela Perkins: And I mean on a live podcast, I’m not going to say how it would work because I don’t want that to ever happen.
Brandon Laws: Oh, she has already thought about this. She’s like, “How do I replace this guy?”
Angela Perkins: No, no, no. But I mean I think with anything, any small business is saying, “How can I leverage and get the most out of the people that I have here?” Then what is either easy to sort of push to a third party or I get more expertise in that third party and I want to leverage my people for the things that they’re best at. Then you’re augmenting and for me, it’s a different conversation with every client we talk to in terms of what makes sense. We do lots of augmentation. We do lots of full outsourced. We have a lot of friends in the HR community that are single HR managers and we only come in once a year and do harassment training, right?
Brandon Laws: Uh-huh.
Angela Perkins: I mean so I think it’s just each employer has to sort of deciding what makes the most sense. How developed your leadership group is making a difference. You know, office managers are often handed the keys to the HR title and those folks need support. So it doesn’t even have to be an HR manager that’s leading all of this. There needs to be a point person. Who is that point person that’s going to know best to leverage that HR resource? So …
Brandon Laws: I would never have made it as a debater. I will tell you that. The thing is I want to break character a little bit because I – you know, I know from my perspective it’s like being an in-house person, you have to be good at a lot of things.
Angela Perkins: Yeah.
Brandon Laws: And you have to admit when you’re not good at something and then leverage it outside. So I would say staying in character here I think got me, the debater, halfway here and that you have to augment.
Angela Perkins: Yeah.
Brandon Laws: There’s no doubt.
Angela Perkins: Yeah, yeah.
Brandon Laws: Because one person can’t do it all.
Angela Perkins: Well, and it’s not even – I mean again, we talk to so many HR professionals in the community and we support them. I mean they come here for training and development and they lean on us for resources, even themselves, right?
We have a lot of folks that work on our team on the HR side that has been previously in-house, right? And now they have all of these resources and the depth of the team around them and they’re thinking – not sure how I did this on my own before. Imagine having to make every single decision on your own.
Brandon Laws: No, it’s not fun.
Angela Perkins: That is both compliance, best practice, culture.
Brandon Laws: Too many laws involved.
Angela Perkins: Right, and it’s just – it’s very – it’s daunting to not have a thinking partner. So …
Brandon Laws: I think you won this round again. This isn’t fair.
Angela Perkins: No, no, no. I’m curious. Like it’s – and there’s obviously a lot of passion in this one. Funny that we talked longer about this topic than paid –
Brandon Laws: You talk about this all day every day. But I –
Angela Perkins: Yeah.
Brandon Laws: Yeah.
Angela Perkins: I don’t know.
Brandon Laws: It was good. That was good.
Angela Perkins: OK.
Brandon Laws: It was good stuff. OK. So we have our last topic.
Angela Perkins: Last topic.
Brandon Laws: And this is pay transparency, radical pay transparency. I think I have the other thing over here.
Angela Perkins: OK. I see because you have a different set for every – OK.
Brandon Laws: I’m going to try to separate them.
Angela Perkins: Yeah.
Brandon Laws: I don’t even know – OK. Well, just start pulling stuff and –
Angela Perkins: So I’m going to – gosh, I’m against again. I think I grabbed every single against.
Brandon Laws: Can we just have you be for?
Angela Perkins: OK, I will be for. I will be for pay transparency. OK.
Brandon Laws: OK.
Angela Perkins: And you get to go second. So I get to go first.
Brandon Laws: Yeah.
Angela Perkins: So …
Brandon Laws: Radical – let’s define that. What does this mean? This means basically publishing pay by the person.
Angela Perkins: So we’re like putting it up on the …
Brandon Laws: Everybody knows what everybody makes.
Angela Perkins: … hallway wall and we’re posting it. OK.
Brandon Laws: It has been on the news a lot. I think – I don’t know if people are actually doing it or if some thought leaders are saying this is a good idea. So we’re going to find out.
Angela Perkins: OK.
Brandon Laws: We will see. Are you both sides?
Angela Perkins: So here’s what I think we should do is I think Brandon, we should go to the database right now, print out everyone’s salary and I want to go post it in the lunch room.
Brandon Laws: Yeah. Do you have access to that? Let’s see what happens behaviorally.
Angela Perkins: Here are the positives of this. No more making stuff up. Here’s what we know. If an employee doesn’t know the answer to it, they make it up. So if they think their peer is making $20,000 more a year than them and they’re underperforming and they’re mad about it and they’re angry and now they’re going to go look for work and all of this, pay transparency takes all of that out because now it’s published.
Now, of course, the flip side of that, it’s published. So if they do make $20,000 more, right? But the transparency takes the question mark out of the heads of all of the employees that wonder how much their peers make, how much their boss makes. It really just – it removes filling in the blank. I’m trying to find another reason why pay full – I mean this is a big topic. We’ve heard a lot of folks. The closest I’ve seen of clients of ours do is more publishing grades by position title, which is a – sort of a safe way of getting a little bit more transparent and communicating to employees how they can grow their salary based on the title.
So the other positive for transparency is really more on the career pathing side. So if an employee recognizes that maybe jumping departments would benefit them because they see the pay and the levels of a partnering – so I – let’s use our world.
Let’s say a payroll specialist is really trying to grow in their overall net and they want to be able to make more and they see that benefits have more levels and they could actually move up a pay scale faster if they career path over to benefits.
It could provide some motivation to moving around within the organization and really benefit the cross-training because sometimes employees are like, “What’s in it for me to learn this other trait or this other department and jump sort of across a team that I haven’t been on before?”
So that would be another positive. I think at the end of the day for pay transparency, why not share it? Because guess what employees are wondering. What are you hiding? What are you hiding from me?
Brandon Laws: You think that publishing salaries would be motivating and knowing what my boss makes or knowing what other people would make would be motivating? Think about – maybe for a few people who are super driven. But what about all the people that would just mentally shut down knowing I do all the work, you do nothing? Yeah, you make double what I make. Like how fair is that?
I think when you start publishing salaries and you make it transparent, I think you make it unfair. I think there’s going to be – I think it will ruin the culture. I think there would be animosity there. People would start pointing fingers. You fail all the time. You’re not good at your job. But you make more than me. That’s not fair. You start gossiping.
Angela Perkins: You know what’s interesting though is don’t you think that’s already happening without the data. So people are walking around the parking lot saying, “Can you believe so and so just bought a Tesla?” or whatever the case is and again they’re filling in the blanks.
Brandon Laws: But they have a loan for that.
Angela Perkins: All right. But I just – again not to interrupt your debate speech.
Brandon Laws: Yeah, that’s fine. Go for it. It gives me more ammo to debate against.
Angela Perkins: You think that ignorance is bliss in this area then. But it’s not ignorance. Its people are making it up. So you might think that not posting it means it’s not there. It’s impacting the culture regardless.
Brandon Laws: I think knowing specifics about what people, individual people can make, will be absolutely harmful. I think broad terms – like if we’re talking about pay transparency in a spectrum, I think where we need to be is pay transparency over why people get paid what they get paid, right? So not like what Angela Perkins makes, not what Brandon Laws makes, not what so and so makes on a bulletin board.
What I think we need is I think we need pay bands published whether it’s like you have multiplier effects with location or years of experience or anything like that, that would – I mean I guess that’s a form of pay transparency but I’m saying that’s the end of the spectrum I want to be on is you know what it takes as an employee to get there and anything outside of that, if you’re making more than what’s on that range, then there’s some sort of discrimination going on.
That’s where we start getting pay equity issues.
Angela Perkins: Sure, absolutely.
Brandon Laws: I think once you go outside of that spectrum, then there – so you’re either a good negotiator or somebody else is getting screwed. So I think pay transparency could help that a little bit. But I think people need to know why they’re – where they’re at. That way there’s no ambiguity around it.
Angela Perkins: But here is another challenge that we find within organizations is we know that there is a different value placed on different roles based on how important it is to the business.
Brandon Laws: Close to revenue.
Angela Perkins: So let’s use sales as an example and this is age-old. I’m not going to say that this is about Xenium as much as it’s just the sort of quintessential normal banter. Oh, sales is easy and they’re out wining and dining and their job is easy.
Brandon Laws: People say that.
Angela Perkins: Whatever and then they come in and they dump the clients on us and then they run off or they get the order and then the engineers are building – right? So there’s always this service sales rub. So I’m actually out of character now because this is not a benefit for pay transparency. But I think that’s a challenge because the business might value a position at something because of what it does for the business and not every employee has visibility to what that means.
So in other words, engineers, great example. If you don’t have the engineer in order to build the product that you just prototyped, then – and this has been an ongoing thing in the market, particularly here in Portland of just a shortage of some of these talent areas.
So you end up having to pay them higher than the market, so higher than your special little grades over there.
Brandon Laws: Oh, interesting.
Angela Perkins: Because you have to get that talent in the door and so I’m not sure you could ever fit it into your little perfect grades and – because you have a market you’re dealing with outside the door.
Brandon Laws: So how do you explain that? You bring in somebody for way higher than the market because they’re talented and you had to bring in this hired gun from Oklahoma or – I don’t know.
Angela Perkins: Wow.
Brandon Laws: I have no idea, right? So just hire somebody outside. You had to lure them in. You pay them way more. Then there’s pay compression happening.
Angela Perkins: Absolutely.
Brandon Laws: You piss off everybody else that you have working for you and then they leave. So your risk is with publishing it – am I arguing?
Angela Perkins: You’re right, you’re right, you’re right.
Brandon Laws: Oh, gosh, I want to argue both sides. This is so fun. Your risk is that you have people really mad around hiring talent and it’s visible.
Angela Perkins: Can I officially throw in the towel? You 100 percent nailed it right there. I mean this is a hot topic. We’re hearing a lot of folks talk about it and I would be hard-pressed to be sitting across from the person that says posting actual salaries is good for the business.
Again that’s what – I’m supposed to be in character. I’m completely out of character right now. But because the business is so complex and you have to have levers to move what you need to do in order to produce a product or service your clients, that sort of thing, that it’s difficult. Pay compression is 100 percent alive and well.
Brandon Laws: Yeah. I think like the bigger issue at play in this and that we – I don’t hear a lot of people talking about it. But I’ve just thought of it is that not everybody is super business-savvy about why people get paid what they get paid, whether you’re close to the revenue and you have – you attribute to the growth of the business or whether it’s really administrative or whether it’s a low-value position for the company.
There are so many factors involved in why people get paid what they do and I think if you published that, there would be so much more resentment because people don’t understand. The only caveat to that is if you really started explaining. But I don’t think that would be enough to mitigate it unless there were some motivating factors to keep developing people.
Angela Perkins: People, yes, yeah.
Brandon Laws: I think if you paired communication around why people get paid – like even if you had to lure somebody in from out of state or whatever, bring him in from San Francisco to code something that you need – like you have talent down there or in Portland. Maybe we needed somebody. We have to pay him a topnotch dollar to come over here and move whereas like – OK. Well, we had a developer here. Not to just compress our wages. But if we said, “Well, this is why. We need somebody who’s at the top of their game,” but guess what. There’s a development plan for you.
Angela Perkins: Right.
Brandon Laws: Like if you stick with us, you’re going to be under this person’s mentorship. You’re going to learn from them and you can earn these pay grades over time. You can get to where they’re at.
Angela Perkins: Right. No.
Brandon Laws: I don’t know.
Angela Perkins: I hear you.
Brandon Laws: That would be my whole thing.
Angela Perkins: Here’s my other thing on this topic is who says it’s the employer’s data to put on the wall? So think about it from the employee perspective. What you’re doing if you go full radical transparency and you publish wages, you’re saying to each of those employees that their pay is now everyone’s business. That’s an employer’s decision?
Brandon Laws: That’s brutal.
Angela Perkins: I don’t know.
Brandon Laws: I don’t know. Well, I would think it would be a leadership position. Our leadership – like a president, CEO to say that this is what we’re doing. This is part of our culture now. It’s transparency. There’s the whole topic of radical candor, right?
Angela Perkins: Yeah, yeah.
Brandon Laws: You’ve messed up. You do something they don’t like or there’s a difficult conversation. I’m just going to come out – I’m saying it.
Angela Perkins: Yeah, yeah.
Brandon Laws: I don’t like your jacket. That’s just demeaning. No, I like your jacket.
Angela Perkins: It’s brand new, Brandon.
Brandon Laws: I was just trying to make a point. It’s brand new.
Brandon Laws: No. So I mean like – I think there’s something to be said about transparency. I think transparency is ultimately good. But I think when you’re talking about comp, I think it’s going to do more harm than good. So you take a utilitarian perspective on this I think greater good and the greater good says this would actually destroy the culture.
Angela Perkins: Well, and I think where we land is A, you won that debate. So congratulations.
Brandon Laws: Oh, I won one out of three.
Angela Perkins: Yes. So – and the second one. I think if listeners are saying, “OK. So but then what?” you kind of touched on it and I do think there’s something to be said about making sure that we’re communicating to employees about their opportunities. We don’t have to post everyone’s salaries to talk about career-pathing and cross-training and opportunities for people to grow and earn more money. Managers should be having those conversations with their employees and companies should be establishing career-pathing plans and career development opportunities for employees because people want to grow.
Not everyone wants a new title or to make a bunch more money. There are some folks that are cool just staying in the role that they’re in. But there are others that want to see that path in front of them and I think that’s hugely important and way more important than posting a bunch of salaries on the wall.
Brandon Laws: Absolutely agree, 100 percent. This is such an experiment and it was fun. We broke character so many times and hopefully it’s not confusing for listeners. But I think it was so fun to be able to play both sides even though I wanted to jump across the table and then …
Angela Perkins: Physically.
Brandon Laws: Physically hurt you.
Angela Perkins: That’s good, hurt me. OK.
Brandon Laws: No. I meant like I wanted to argue on the other side and I’m sure you want to do the same just because I think there are so many points that you can argue back and forth.
Angela Perkins: I really liked the concept of – in our businesses, we always have those opportunities where we’re kind of toe to toe with an issue and to really listen. That was something we had to do because we really were, listeners, I promise you unscripted, no prep.
Brandon Laws: No prep.
Angela Perkins: Brandon had three bullet points in an email. That’s all I got. So we – you really have to listen and – because generally speaking, you can find a “Yes, I hear you,” and that actually makes sense in each of …
Brandon Laws: In a lot of cases, I think our clients are asking this. So you made the point at some point in the outsourced HR argument. Four hundred clients all over the place, different industries and I think when you are starting to talk to these owners, they’re all concerned about something a little different. Some of them overlap of course. Employee relations issues, it could be paid leave issues. Some of these – they’re so cash-strapped that one mandated thing could tip them over. So they’re concerned about it.
So people are asking about those sorts of things. Other people on the culture end of the spectrum, like on our pay transparency thing, they’re asking about, “How do I become a great employer?” Right? I think you made a great point just there is we have to meet people where they’re at and I think that’s – what we were trying to draw on this podcast is that there’s never one answer, one size fits all to every topic.
That’s what’s really frustrating today. I’m sorry. I’m on my soapbox right now. It’s really frustrating. I’m on Twitter a lot like looking at current trends with a lot of sports. But you would be so amazed at how polarized people can be. This is the definitive answer and I call BS on that because there’s always an answer on both sides or in the middle.
Angela Perkins: You know what I heard recently that totally helps support that, be the un-expert. Practice your job and your role as a leader in the company or the business owner or just a contributing employer, employee and be the un-expert because there are so many experts out there saying everything that they know, that if you can just listen, you can learn so much from the employees that you’re supporting. So if you’re wondering, “Should we go pay transparency? Do we need to lead the market with paid leave?” ask your people. Ask your employees and be the un-expert.
Brandon Laws: Yeah. Well, thanks for coming on the podcast. This was a lot of fun. You’re on LinkedIn. People can follow you there, right?
Angela Perkins: They could, yeah.
Brandon Laws: Should I put out your email address so people can email you?
Angela Perkins: How about not that?
Brandon Laws: OK. We will not do that. You can reach out to Angela on LinkedIn. She likes messages there. If you’re not a subscriber to this podcast, you got to go to Apple Podcast or Stitcher, like your favorite podcast app. You go there. You give a five-star review. A written review would be awesome. Follow us. Share it with your friends. It’s a great podcast, Transform Your Workplace. We will talk to you next week.