It can be human nature to base our perceived worth on money when it comes to work – so when staff start talking salaries, often comparisons will be made and people may end up feeling less valued. Unfortunately, this can also lead to problems with morale, productivity and engagement with the company, and has the potential to cause disputes between employees. So how do you handle it?

One of the first steps to tackle the issue is to address the reason why the employee feels the need to discuss their salary. Is it because they feel underpaid and undervalued, or simply because they don’t understand the reason why their salary is set at the level it is, or exactly what they’re paid for?

If this is the case, you can handle this by increasing the transparency around salary levels across the business. You could do this by:

  • Making target levels which correspond to salary levels accessible to employees
  • Increasing communication with the particular employee as to why they’re at their salary level
  • Advising the employee what they can do to achieve a pay rise
  • Reiterate the value placed on the employee and their work

Positive steps like this will reduce the possibility of employees discussing salaries with colleagues.

Managing a dispute

Where disputes have arisen due to a discussion about salaries between staff members, they should be dealt with immediately. Leaving any problem to fester is likely to lead to a minor issue being blown into a major dispute, or even a potential grievance scenario.

Managers and supervisors should be trained to deal with disputes effectively and to take active steps to solve problems as and when they become apparent. While these can be difficult conversations to have, it’s essential that employees feel they’re being listened to and that they’re encouraged to bring forward problems before they become blown out of proportion.

Other steps that can help avoid these issues are to remind employees not to get involved in office politics, or to introduce an initiative to reduce office gossip. If the dispute isn’t solved at an early stage through management intervention, the employee should be reminded of the grievance and dispute procedure and any grievance raised should be handled by following this.

Contractual clauses

Some employers place a contractual ban on employees discussing their salaries, e.g. by including a clause in their employee handbook to prohibit this.

These clauses are valid and can certainly be utilised – except where the employees’ discussion is being held with the intention of determining whether one sex is paid higher than the other. Legislation does not allow you to ban employees from discussing their pay if it’s to determine whether or not their employer is breaching equal pay law.