Should salary be based on experience?

The usual trope is that, of course, salary should be based on knowledge, but there are a number of clear issues that arise when organisations advertise roles with salaries based on experience.

We spoke to Sue Parker, a career strategist, communication expert and owner of DARE Group Australia, who explained her stance on salaries that are based on experience and why she is strongly against it.

Salary based on experience is when the band salary isn’t advertised by the company; this a common tactic that is often deployed.

Ms Parker believes this tactic is far more commonly used in the private sector rather than the public sector: “Let’s be very clear here. We’ve got public and private sector. [In] the public sector, the band of salary is always advertised and promoted in all recruitment drives and advertisements, but private organisations generally don’t.”

Ms Parker doesn’t mince any words when she announces her displeasure with the private sector’s use of the salary based on experience cop-out.

“Often, you will see salary based on experience, and that is an absolute lot of nonsense. It’s a get-out-of-jail card. It’s very unclear, it’s unkind, and it’s duplicitous,” said Ms Parker.

“That’s my issue as part of many issues with the salary, but certainly because that just gives such a lack of integrity around the role’s needs and the role’s purpose aligned with the type of candidate that’s best suited to do that role.”

Ms Parker clearly states that this isn’t something that has grown over the past couple of years but instead has always been there and has continually been deployed by recruiters and companies for a long time.

“It’s something that’s always been there. I mean, I had my recruitment agency for 11 years. I wouldn’t let people get away with it,” said Ms Parker.

“It’s always been the case in the private sector, and my issue is very much you’ve got a role, there’s key performance indicators in that role. The role has a need to solve that. The issues of that role are the same. If a person is deemed suitable to fulfil that role, it’s irrelevant how much experience they’ve had.”

Roles in themselves, unless the components are adapted, should always display a salary band. Salary bands refer to the minimum and maximum amount a company will pay someone within a job level.

“That exact role that’s advertised should have a realistic and fair salary band. Hence the reason why I’ve always pushed back on the salary based on experience,” said Ms Parker.

“I’ve seen it in my recruitment agency many years ago that hiring managers wanted to offer a person a role great because they were great, but then they picked something out in their background that said, I don’t think they’re worth as much as I originally said, which is incredibly inappropriate.”

In this kind of situation, clarity for the person applying for the job is crucial. Ms Parker concludes that without the salary band, clarity dissuades, which can open up to manipulation.

“Unclear is unkind; anything which is open to potential manipulation is unclear; it’s unkind, and it wastes people’s time.”

The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full conversation with Sue Parker, click below: