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The policy and legal implications of discussing compensation

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in Employee Benefits Program,Employment Law,HR Management,Human Resources

Q. We recently had salary adjustment, and some of our employees have been comparing their raises. But we have a policy that states that compensation matters are confidential. Executives have asked HR to speak to the offending employees and gently remind them about our policy. I am concerned that if I speak to any of the employees, the problem will just get worse. Ideas?

A. In point of fact, employees have a legal right to discuss their compensation.

The National Labor Relations Act has been interpreted in such a way that employers cannot prohibit free speech that would interfere with employees discussing labor issues, including compensation.

There also is a Michigan statute (the Michigan Wages and Fringe Benefits Act) that specifically states that employees cannot be prohibited from discussing their wages or discriminated against if they do. Many employees don’t want to talk about their compensation, but those who do have a right to do so.

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