Inside Reddit: No Salary Negotiations!

Reddit’s been in the news nonstop lately. First interim CEO Ellen Pao’s failed sex-discrimination case against Kleiner Perkins. Then Pao’s shutdown of Reddit’s r/fatpeoplehate in June. And now, the dismissal of a key Reddit employee, Victoria Taylor. Reddit’s voice on the web is huge, thanks to its volunteer moderators. The company itself is small, however, with around 60 employees and a business model that still doesn’t turn a profit.

That’s why I was interested in Pao’s comments on pay in her conversation with WSJ in April. Pao said one way Reddit addresses gender inequity is by eliminating salary negotiations. Studies show that salary negotiations are a touch point for some of the inequalities we see in the workplace. Men are more likely to negotiate, women may see more blowback from negotiating, and studies have shown in so many ways how the game is rigged from the start – male names atop resumes are more likely to be chosen than female names with similar experience and men are hired on potential while women are hired on past experience. Eliminating salary negotiations may seem like a salve for uneven compensation, but I’m happy to see that this is not a widespread corporate practice.

First of all, salary negotiations are only one of many negotiations in the workplace. People negotiate benefits, work assignments, promotion paths – even the day-to-day of work life involves small negotiations. “Can you do a favor for me?” – that can be an opening to negotiate for resources and power. Eliminating salary negotiations doesn’t wipe out inequality.

Secondly, negotiations can be mutually beneficial. Some employees may want more equity and less salary. Some employees may want flexible schedules. Some employees may take on additional responsibilities over time and ask for more. How does that work when the employer dictates the terms? In an environment without negotiations, the employee has only two options – take the offer or leave. This kind of black-and-white scenario doesn’t work for either side of the negotiating table. 

A better move is to aim for transparency. Few companies get behind this, but companies with pay bands and levels give employees a sense of appropriate compensation in their role. Transparency is a key driver of employee engagement. And knowledge is power. Did you know men are more likely to talk about compensation among their friends than women? A completely unscientific poll among my friends show this to be anecdotally true.

So what’s the way forward? For companies, it is taking risks in being transparent. For individuals, it is knowing the market and gathering knowledge from your peers. Negotiation isn’t a thing to be avoided – it’s a dance, in which both parties can find mutual satisfaction. 

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