Is verifying prior employment including salary history a waste of time? We think there are a lot of good reasons to verify prior employment including salary history. Recently, I noted a Point/Counterpoint discussion of the issue of even asking for salary history in HR Magazine
Contrary to what you might think, I don’t automatically agree with all the “yes” reasons.
First, let’s make our case for verifying prior employment including salary history.
- The article just mentions “using salary history”. Our first comment would be why bother asking for salary history if you are not going to verify it with the prior employer. We believe in verifying statements from your applicants.
- In general we believe people will behave for their current employer as they have behaved for prior employers. It makes good sense to perform due diligence in assuring that the individual you are about to consider bringing into your workforce has exhibited the capabilities, titles and responsibility alleged on your application. This verification would an attempt to confirm salary history. Consider for a moment the process your firm conducts when it is going to purchase an expensive piece of machinery. I am sure that a thorough due diligence process assures that the machinery can do tasks alleged by its producers. And, I am confident that independent reviews and evaluations are conducted. Now, consider what hiring managers demand of HR when hiring new employees. If there is a big difference, I bet turnover is high in your firm and mistakes cost your firm customer loyalty and profits.
- We believe that if an individual is going to falsify your company hiring documents that same individual wouldn’t hesitate to falsify your company documents once in your employ. Again, we believe people will behave in the future as they have in the past. Why not take the time to verify what you are being told on your application. If there is a falsification, you can rest assure that person, if hired, would continue the falsifications.
- And, conducting prior-employment verification with a past employer enables the tort of negligent referral against that prior employer if in fact the prior employer withheld truthful and factual information related to the individual’s behavior while in their employ. Click here for more on that action
Below is a discussion and evaluation, from our perspective, of the points made in the article:
Sylvia Francis, SHRM-SCP, presented the “yes” case for asking salary history. She is the total rewards manager for the Regional Transportation District in Denver and a member of SHRM’s HR Disciplines Special Expertise Panel.
“In reality, however, the reason employers request this information is to avoid wasting everyone’s time. HR must have a means of gauging how likely a candidate is to accept an offer the company is prepared to make.”
This reason may in fact be removing individuals from the pool that would turn out to be excellent candidates. In my experience, and I bet yours also, you have encountered any number of individuals who are looking for a job and have been told that their prior level of salary and experience removes them from consideration. When in fact, these people would have taken the job, out of need, and done quite well.
“Here, too, salary history is helpful in clarifying expectations. Many candidates will see the range and expect to be offered compensation near the top. Knowing the applicant’s current salary can help HR to manage this situation and explain the rationale for offering pay closer to the middle of the band.”
Here again while Ms. Francis wants to provide good reasons to perform the inquiry about salary history, it reads like there is an assumption on the part of the candidate’s reply to the eventual level of compensation. If a candidate is a competent and talented individual who has expressed interest in the job, a clear channel of communication of expectations regarding salary would alleviate this potential problem on the part of the applicant’s understanding.
“Finally, from a hiring manager’s standpoint, salary history also provides valuable information about the candidate’s career progression. Steady rises in pay demonstrate increased responsibility over time and show that the applicant was successful in previous positions.”
Wait a minute. This sounds to me like an unjust case of pre-judging someone’s work history based on past levels of compensation. Why would you come to a negative decision about someone’s career progression based solely on levels of compensation? That is not a fair assessment particularly given the economic environment of the past decade. Just because someone doesn’t have a straight line UP doesn’t mean they are not progressing in their career. Doesn’t the fact that someone has continued to work in their chosen profession, no matter the level of compensation, mean something positive? Certainly I am trying to make the point that there may be legitimate reasons for someone’s career progression not to be one of constantly increasing levels of compensation. Companies go bankrupt. Companies lay off workers through no fault of the laid off worker.
Katie Donovan presented the “no” case for using salary history. She is the founder of Equal Pay Negotiations in Medford, Mass., which focuses on eliminating unintended biases in the hiring, promotion
“One legitimate business purpose HR professionals will give for using salary history is to save time. Eliminating those who earn more or less than the budgeted salary can help to quickly cut a pool of 250 applicants down to a much more manageable five or 10. Unfortunately, however, what organizations save in time, they may be losing in diversity—which could wind up costing them far more in the long run”
We agree with this comment, even though it is on the “no” side of the argument. Arbitrarily removing people from the pool strictly based on prior salary jeopardizes possibly obtaining the best candidate. We think there are many people with higher prior salaries that are being removed from the pool. Ms. Donovan believes that removing people who make less than the salary range of the position are being arbitrarily removed.
“Taking prior compensation out of the hiring equation is an idea that has been gaining traction. When I first proposed an end to salary history questions in 2012, I felt like I was alone and out on a limb. But just three years later, in 2015, Beth Cobert, interim director of the Office of Personnel Management, made headlines when she issued a memo suggesting that using salary history to set future pay is perpetuating the gender pay gap.”
Sorry, we think the gender pay gap is a bit over stated. Both the Census and BLS take into account “occupational segregation,” or the tendency for women to enter lower-paying fields than men, according to the Institute for Women’s Policy Research, as well as the fact that women take more time off from work due to pregnancy and child care, as noted in a report prepared for the Department of Labor by CONSAD Research Corp. CONSAD’s analysis suggests that the gap shrinks to between 93¢ and 95¢ cents, but that can vary considerably depending on the industry. http://time.com/money/4009768/wage-gap-men-women-equal-pay/
It’s time to stop asking for salary histories. Eventually, it will be a common best practice and perhaps even the law. Why not get ahead of the curve?
I hope not. It is bad enough that the government is attempting to remove an employer’s right to use criminal convictions in evaluating a person’s past behavior. Salary history and its accuracy as stated on an employer’s company document is an important part of determining whether or not an individual is qualified to be in the workforce. It is an important exercise in evaluation their general character.
