Attitudes on pay transparency and equity in the workplace

Published: January 13, 2025 | by Brightmine

Pay transparency and equity are not just moral or regulatory obligations–they are vital components of a successful talent strategy. In a labor market increasingly defined by worker expectations around fairness, accountability and trust, employers that fall short on pay transparency and equity risk more than legal penalties but the ability to foster a diverse and competitive workforce.

However, separate research of HR professionals by Brightmine in December 2024, revealed a troubling disconnect:
only a third of organizations consider these regulations integral to their business strategy. For the majority, compliance remains either a task to delegate (37%) or worse, a source of frustration (30%). This mindset does not align with today’s workforce–particularly young workers and women, who place immense value on transparent and equitable pay practices.

To stay competitive in 2025, employers must take meaningful action to promote pay transparency and equity and meet employees’ evolving expectations. But what does meaningful action look like to workers and what will happen if employers fail to meet the mark?

To better understand this, we commissioned a survey of 2,000 U.S.-based adults, including 1,116 employed Americans to gain insight into Americans’ view on pay transparency and equity as foundations of workplace satisfaction and retention, their perceptions of the progress being made and their expectations for the future.

Check out the findings below to learn more.

Pay transparency and equity: cornerstones of talent attraction and retention

Pay transparency and equity are essential pillars for attracting and retaining talent in today’s competitive labor market. As of 2024, 14 U.S. states and Washington D.C. have passed laws to regulate pay transparency. As legislation aimed at promoting more transparent pay practices becomes more prevalent, these issues are under sharper scrutiny than ever before. Employees today are not only more aware of the historical lack of transparency around compensation and the pay disparities that exist. They also have higher expectations for employers to demonstrate a clear commitment to fairness, accountability and inclusion in their pay practices beyond legal requirements. In fact, when asked to rank job factors in order of importance, a third (33%) of employed Americans ranked pay transparency and equity as their top priority, compared to compensation and benefits (33%), career growth opportunities (13%), workplace flexibility (11%) and company culture (10%).

This demand for pay transparency and equity is particularly pronounced among younger workers. Gen Z respondents (44%) were most likely to rank pay transparency and equity as the most important job factor, followed by Millennials (37%), Gen X (26%) and Baby Boomers (20%). With Gen Z expected to make up 30% of the U.S. workforce by 2030, this is an urgent signal for employers to review and refine their pay transparency and equity strategies and ensure practices are more than just check-the-box exercises.

Moreover, employees want to feel confident their pay is competitive in the broader market and that their employer openly communicates how pay aligns with their skills, experience and contributions. If expectations aren’t met, it can spell trouble for employers. A third (33%) of employed Americans say they would seriously consider seeking employment elsewhere if they learned that a colleague in the same role was earning a higher salary than them and another 51% saying it might push them to explore other employment options, just not immediately.

Reality check: employers aren’t meeting employee expectations

Despite the importance of pay transparency and equity in driving talent outcomes and overall business success, many organizations are falling short of employee expectations. Only a third (32%) of employed Americans consider their employer “very effective” in their current approach to pay transparency and more than a quarter (26%) believe their organization prioritizes profits over fair pay.

Unmet expectations for pay transparency and equity are felt particularly acutely by women and Gen Z workers.

When it comes to female workers:

• Women are less likely than men to understand how their salary compares to others: Just 52% of female respondents feel they have a clear understanding of how their salary compares with others in the same or similar job in their industry, compared to 67% of male respondents.
• Many women feel they are not paid fairly or equally compared to their peers: Only one-third (31%) of female respondents believe they are being paid fairly or equally compared with their colleagues in similar roles, compared to almost half (47%) of male respondents that said the same.
• Women have less confidence in their company’s approach to pay transparency: Just 18% of female respondents consider their organization’s approach to pay transparency in the workplace “very effective,” compared to 28% of male respondents.

Historical disparities and a lack of openness around compensation have led many women to doubt employers’ commitment to pay transparency and equity. When companies fail to openly share pay information and take steps to correct inequities, women are left questioning whether genuine progress is being made.

This skepticism is echoed among Gen Z and Millennials, who comprise over half (54%) of today’s workforce and will only expand their presence as Baby Boomers retire:

• Gen Z and Millennials are dissatisfied with employers’ pay transparency efforts. A quarter (25%) of Gen Z respondents believe their employer is not transparent enough about pay practices and 28% of Millennials agree. While Gen X respondents (24%) shared this sentiment, there is a significant gap in Baby Boomers’ outlook towards the issue, with just 11% believing their employer is not transparent enough about pay practices.
• Young workers recognize gaps in efforts to address pay equity in the workplace. Almost one in four (24%) Gen Z and Millennial respondents said pay disparities are a serious issue in their workplace. In comparison, 20% of Gen X and 10% of Baby Boomers agree. Additionally, more Millennials (28%) and Gen Z (26%) respondents share the belief that their organization prioritizes profits over fair pay, as compared to 11% of Baby Boomers.

Transparent and equitable pay practices are no longer just a preference, they are becoming a standard. In fact, although a federal mandate for pay transparency is unlikely in the U.S., more than half of employed Americans (59%) agree there should be one in place, reflecting heightened demand for accountability in addressing pay transparency in the workplace.

So, what will it take for employers to meet employee demands?

Meeting expectations means taking action.

The first step in meeting employee expectations for greater pay transparency and equity in the workplace is ensuring compliance with state-level legislation. Navigating the complexities of legal requirements can be a significant challenge for employers, as found in our research, with 57% finding it challenging to stay in compliance with pay transparency regulations. Similar obstacles exist for tackling pay equity, with half (50%) of executive leaders admitting pay inequities still exist at their company and 52% saying remaining compliant with recent laws and regulations is a key barrier to achieving progress. Despite these challenges, legal compliance with pay transparency and equity laws are essential to fostering trust in the workplace.

Compliance is a key piece of the puzzle, but employers shouldn’t stop there. They should extend their pay transparency and equity practices beyond what’s legally required. This includes breaking the salary taboo and encouraging open conversations around pay at work, where discussions have often been shrouded in secrecy:

• Anxieties persist around pay discussions at work: Nearly a quarter of employed Americans (22%) feel uneasy discussing salary with their manager. This anxiety extends to sharing salary information with peers, with 43% of employed Americans saying they have not shared salary information with colleagues and want to keep that information private.
• Women are less comfortable discussing pay: 60% of female respondents have not disclosed their salary with colleagues, compared to 48% of men. This reluctance among women to express openness around pay is likely due to a fear of reinforcing gender disparities or concerns of judgement.

By normalizing discussions around compensation within the organization and extending that transparency to external job postings and in hiring processes, employers can dismantle outdated stigmas, build trust and create a culture where employees and job seekers feel valued and respected. As far as actions employers can take to increase their trust in management, employed U.S.-based Americans said:

• A detailed breakdown of how salaries are determined (52%).
• Including salary ranges in all job postings (49%).
• Disclosing salary ranges for all positions within the company (39%).
• Sharing how salaries compare across the industry (38%).

To deliver on these employee requests, employers need to have processes in place to track pay data and conduct thorough analyses on pay equity and how salaries benchmark across the broader market. Only half of organizations (47%) currently conduct pay gap analyses and only a quarter (27%) have clear goals for pay equity metrics that progress is measured against; however, most companies (80%) do refer to external salary benchmarks when making decisions about pay ranges and starting salaries. These findings reaffirm that while many employers have taken steps to improve pay transparency and equity in the workplace, more must be done to achieve true progress.

There’s no underestimating the importance of pay transparency and equity in the workplace

Pay transparency and equity are more than compliance boxes to check. They are essential elements for attracting and retaining top talent and driving business success. Organizations that want to remain competitive and build a diverse, engaged workforce in 2025 should focus on going beyond the bare minimum to meet employee expectations for fairness, openness and accountability around pay.