What is a consequence of pay secrecy in the workplace?

Pay secrecy in the workplace often leads to a negative impact on trust among employees and between staff and management. When salaries and compensation structures are kept confidential, employees may feel uncertain or suspicious about the fairness and equity of their pay compared to their peers. This lack of transparency can foster feelings of resentment, anxiety, and mistrust, particularly if employees perceive that others may be earning more for similar work without clear justification.

In environments where pay information is hidden, employees have difficulty making informed decisions about their own compensation and career progression. This can diminish morale and engagement, as individuals may question whether their contributions are valued equitably within the organization.

In contrast, transparency about pay can lead to higher levels of trust, as workers feel that they are treated fairly and that their compensation is based on clear, understandable criteria. Therefore, the consequence of pay secrecy primarily manifests as an erosion of trust within the workplace.