Pay Transparency Before the Deadline
A 600-person manufacturer operates in a jurisdiction introducing pay-transparency rules: from next year, employers must disclose pay ranges in job postings and cannot ask candidates for salary history. Internal data shows base-pay ranges within job families vary by up to 22% for equivalent roles, largely reflecting when people were hired and how aggressively they negotiated. Women are overrepresented in the lower half of several families. The CHRO has 8 months and a limited budget. The CEO worries that publishing ranges will trigger internal equity complaints and raise labor costs, and asks HR whether to 'just post wide ranges' to preserve flexibility.
1. Evaluate the CEO's proposal to post wide ranges. What are the risks, and what should HR recommend instead?
Read the worked answer
Posting artificially wide ranges to preserve negotiating room is a compliance and credibility risk, not a workaround. Regulators and candidates increasingly scrutinize whether posted ranges are genuine; ranges that span implausibly wide bands can be read as non-compliant or as bad-faith disclosure, inviting complaints. Internally, wide ranges signal that pay is negotiable and arbitrary, which amplifies the equity complaints the CEO fears rather than containing them.
The underlying problem is the 22% unexplained spread within families, driven by hire timing and negotiation-exactly the pattern transparency rules target. Wide ranges preserve that spread instead of correcting it.
Recommendation: build defensible, genuine ranges from a consistent job architecture and market data, then post those. Use the 8 months to (a) define job families and levels, (b) set ranges with a documented methodology, and (c) plan remediation for out-of-range and unexplained-gap cases. The recommendation to the CEO: transparency is coming regardless; the choice is whether to shape the ranges deliberately or have them exposed.
2. How should HR prioritize equity remediation given a limited budget and 8 months, and what sequencing reduces legal and morale risk?
Read the worked answer
Prioritize by legal exposure and severity of unexplained gap, not by who complains loudest.
- Map first (months 1–2). Quantify within-family spread and identify where the gap correlates with protected characteristics (the gender pattern) versus legitimate factors (tenure, performance, documented skill). This separates unexplained gaps-the real liability-from explainable variation.
- Fix the highest-risk cases first (months 2–5). Remediate the largest unexplained gaps in families where the gender skew is strongest, and bring any employees below the new range minimum up to it. These are the cases most likely to become complaints once ranges are public.
- Stop the leak (ongoing). Remove salary-history questions from all processes now, and train managers to make offers within range bands-so the spread stops regenerating.
- Communicate the 'why' (months 5–8). Brief managers and employees on how ranges were built before posting begins, so the first time people see a range isn't in a job ad.
Sequencing rationale: remediation before disclosure prevents the worst optics (publishing a range that reveals a colleague is underpaid), and fixing the intake process prevents recreating the problem after the budget is spent.