Employers in Tennessee have to strike a careful balance when acquiring or promoting talent. Careful compliance with employment equality laws is crucial even when writing a listing, as the wrong language could lead to claims of discrimination. Regulatory compliance is critical to a company’s finances and reputation. So is the way they treat their workers.
When hiring new talent, organizations often need to offer competitive wages and benefits without paying more than the current market rate for those services. Most employers prefer to keep base wages as low as possible while still attracting the best talent. Negotiating wages on a case-by-case basis instead of setting a fixed salary for each open position is one way to maintain that balance. Some workers may agree to perform a job for less money than others with similar skills and experience. Organizations can theoretically save thousands by using the right negotiation tactics when hiring and promoting workers.
Are businesses operating in Tennessee currently subject to any wage transparency statutes?
There are no state or federal wage transparency laws
Wage transparency laws prevent companies from paying two workers a vastly different amount for the same position. The company must provide transparent information about what a position pays to comply with those laws.
There are some federal rules that govern wage practices. For example, it is inappropriate for businesses to pay female workers less than males in the same position, as that is a form of sex-based discrimination. However, there are no current federal wage transparency laws that govern Tennessee businesses.
Tennessee lawmakers have introduced bills proposing wage transparency regulations, but the state has yet to enact any such statutes. For the time being, employers can continue to negotiate different pay for different professionals without fear of creating disputes with their employees.
That being said, wage transparency can be an attractive feature for workers in competitive fields. Professionals may be more likely to apply for positions where there is a clear wage promise or a rough spectrum of estimated wages provided as part of the job listing.
Ensuring compliance with employment laws can be as important as providing competitive wages to continue attracting the best workers. Businesses accused of employment law violations can experience reputation damage that can make hiring the best and brightest more difficult.