I downloaded a personal report from the work number website and found to my horror that my employer was reporting every. single. paystub. gross and net, to equifax.

That felt like a huge breach of privacy. Given that equifax had already proven incompetent at keeping my data secure, I immediately sent HR a request to stop sending my supposedly 'confidential' pay info. They politely told me to kick rocks, so I went on TWN's website and froze that report so no one would be able to request it, and it will be a cold day in hell before I thaw it.

I froze the report, and I also told my employer not to report anything to Equifax (which luckily my employer allows).

This made getting approved for a mortgage more difficult. These days, loan officers just expect to be able to hit a button and get all your info.

We're losing the privacy battle.

The freeze is mostly ineffective for when you actually want it to work. From what I remember (even for the credit freezes) is that if you provide written consent to, say, a background check, then that overrides your freeze. So if you're applying for a job (basically the major instance where you'd want your salary information private) they're going to ask for your consent to do a background check and bingo they'll know how much money you make.

IMO this type of information should be illegal to sell or request.

In case folks want to quickly know how to start a freeze, heres the info from the website:

To communicate a freeze request, send an email to the address below requesting a Freeze Placement Form: TWNFreeze@equifax.com

As a datapoint for how I've seen this used in the real world, I've spoken to startups who will defer to Pave regarding how much they'll offer to pay. The startup I spoke to said 'We pay you the 85th percentile for your YOE and role based on Pave data'.

I just signed up to see what they have on me.

I love that they have ALL my personal info, but I can't create an account with a password longer than 16 characters.. Why the heck are they not storing the hash?

Great security.

Pave is a company that has been snapping up other existing companies that performed this kind of aggregation of compensation data. Basically companies look at this benchmarking data to figure out what they should pay for different jobs and levels. Just some extent companies genuinely need this kind of data to figure out what to do. But I also think it breaks supply and demand. Companies are not discovering price of labor but just using each other’s signals to decide what to pay collectively

https://www.pave.com/blog-posts/announcing-paves-series-c-an...

These services feel not dissimilar to the Realpagr case that is ongoing now with rent price fixing.

How does this ultimately not end up having a depressing impact on salaries?

This thread got pretty off track. But, if I were to opt out of this database and went looking for a job, would potential employers not be able to see specific history about me (or at least not from Equifax)?

“I’m an employee looking for my data”. Links to https://employees.theworknumber.com/

Spits out 403 error forbidden

Gosh, that’s awful.

If one is required to sign an agreement to a background check, could this supersede one’s freezing of one’s Work Number?

> Under the Sherman Act, agreements among competitors to fix prices or wages, rig bids, or allocate customers, workers, or markets, are criminal violations. Other agreements such as exclusive contracts that reduce competition may also violate the Sherman Antitrust Act and are subject to civil enforcement.Dec 20, 2023

A good US.A. could probably argue this meets that bar. Didn't they just do something similar with the rent fixing from that similar SaaS product?

How sure are you that the incentives in place don't encourage inching toward this behavior as they begin to establish themselves?

What's the point of getting this data if it's not to pay less money? What is the value add?

RealPage pressures clients

To be clear, they're not "pressuring" them, they simply drop clients as a rule who don't use their suggested rent prices at least 80% of the time.

Yah, that's the main difference: RealPage pressured landlords (i.e. tracked then) if they did not raise rents based on its recommendations.

If they had limited themselves to simply reporting the numbers, and letting landlords make their own decisions they would probably be legal.

Yes, but the information here is not public, since it's being sold as a service.

If it were public, employees and job seekers would also have the information.

Huh, this tacit collusion being legal thing is mind boggling.

The law firm example seems imperfect though. Publicly announcing that you’re raising salaries isn’t really the same as internally sharing that data and choosing to set the same salary based on that.

> when one leading law firm announces salary increases and other law firms immediately match it

Because it's public so doesn't reduce the amount of bargaining power employes have and therefore distort the market. Which is the main problem here.

Beyond salary, there is a whole industry of data brokers who get transactional data from individual participants in an industry vertical (CPG, Health Insurance, Salary, etc), aggregate it with their competitors and present it back to those participants as benchmarks. Management Consulting likewise is a way to launder getting strategic insight into your competitors from a third-party.

The market might be more transparent for the people who have access to pave, but for those who dont, the information asymmetry becomes worse.

> Collusion requires an agreement between rivals that negatively disrupts market equilibrium. Is this company not actually making the market more efficient and transparent? That said - an efficient market is good for the collective, not necessarily the rogue / outlier individual.

I'm sure you practice what you preach and tell all your employees what their coworkers earn?

> HR will make it seem like a rule, but if you do spectacular work - you can always negotiate.

Every single developer should take this to heart. The phrase I once used at the end of an annual review was, "you can't give me a review like that but a raise like this!"

Yes, my manager had to get permission to give me the % increase I wanted, but it was to his benefit to do it since he wanted me to stay.

> Is this company not actually making the market more efficient and transparent

No, not at all. Unless applicants/employees get full access to the same information.

Ok, so your company ended up raising salaries because you were underpaying. That certainly wouldn't be the case if you found out your salaries were ABOVE average. You'd keep it the same at best, but most likely lower it.

That's the point of these systems. If it's not illegal, then it should be.

anecdotes are not evidence

> Wage fixing is when multiple companies agree to set wages at a certain amount.

I am not an expert on wage fixing laws in the US, but I came across a class action on wage fixing a few days ago (Ron Brown et al v JBS USA Food Company et al) where part of what was aledged was the illegal exchange of salary data via surveys [1].

> The Red Meat Industry Compensation Survey conducted by WMS on behalf of the Defendant Processors violated the Safe Harbor Guidelines in at least three ways. First, the Defendant Processors, not WMS, collectively managed and controlled the annual Red Meat Industry Compensation Surveys. Second, those Surveys often contained information about the Defendant Processors’ future compensation plans and practices. Third, Defendant Processors had extensive discussions about the Survey results, including at in-person meetings, during which they disclosed their respective compensation rates, practices, and plans

[1]: https://www.classaction.org/media/brown-et-al-v-jbs-usa-food...

I'm asking this as someone with 0 legal knowledge: doesn't the context matter? If every company takes this data and is like "we want to pay at the 95th percentile" (which is what they all do), that seems like wage fixing even if they're not all agreeing to it together.

>Company A can use the compensation data from Company B to try and compete better for talent.

My company has done this in the past sorta indirectly, we were losing a lot of people to competitors and data like this is how they justified paying a bunch of us better so we wouldn't leave. I agree that it could be used to fix wages, but companies will always have to pay their best talent more if they want to retain them, whether that means paying them above what the data says or if it means inventing new job titles for them to progress into.

Stochastic wage fixing is still wage fixing

> Company A can use the compensation data from Company B to try and compete better for talent.

Company A could make offers and negotiate with prospective hires based on the value they can get out of the hire. Rather than secretly leverage surveillance capitalism against the prospective hire, to base their offer on what the person is currently making (and, hey, if lots of employers do that by convention, you pretty much have collusion).

No, you don't set salary bands based on race or sex. That sounds like it would be illegal. The way that bias creeps in is not from data gathering and setting salary ranges, it's from managers bias when they choose from the ranges for candidates.

Setting company wide salary bands actually HELPS fairness in pay by providing objective ways employees can argue that they are underpaid if that's the case.

But then we're not sharing other people's personal information.

But the salary data that’s available online to me as an employee is imperfect and extremely limited. This would be like if every employee of a major company sent their exact salary and demographic information to levels.fyi, which would never happen because it’s an insane sacrifice of privacy

RealPage also gave recommendations. Giving a salary range seems like the same thing.

"I believe wage-fixing would require companies to agree to…fix wages"

They don't need to officially twirl their mustaches and laugh evilly while telling each other how they're definitely fixing wages. They just need to share data on wages with other companies in the same or a similar business with the intent of decreasing wages. That is already illegal, because they're colluding with competitors to keep wages low.

The whole point of getting such data is to ... fix wages.

Do you actually believe they will be doing this?

Your salary negotiation point speaks more to a call for open salary data, which many people have been arguing for.

You're missing a lot with your second point though. If a company has excellent salary data and can put in you a band, then it also means that you have better grounds to argue for raises when you gain experience, or argue if you are underpaid, or even find jobs at companies who intentionally pay a higher percentile to market as a way to attract better talent.

In contrast, if we all operate 100% blind with no data, as many here seem to want, it would lead to all sorts of unfair wage situations with people doing equivalent jobs earning vastly different amounts. This sort of environment is biased towards more aggressive people who have strong social skills when it comes to negotiation. In fact, you see exactly this when companies choose not to buy data like this to set their bands.

>What level of data are they getting? If it’s tied to your HR system, does it get anonymized performance reviews?

Pave user here. Absolutely not. It's anonymised comp data. Essentially salaries and job titles only.

Whilst I do agree with your point that data like this should be publicly available, I'm not sure I understand how it gives employers a negotiation advantage?

"at least a collective incentive to lower wages."

???

In accordance with HN guidelines I am going to resist giving a snarky answer and will instead clearly articulate: Companies clearly have a strong collective incentive to lower wages.

"While companies could use the data to ensure their offers are always below average (pushing wages down), they could also use the data to ensure their offers are above average, pushing wages up."

They may do both. Collude to keep average wages low, so that when they offer outliers "above-average" it is still cheaper to cross that many standard deviations.

"Think about it: prices are transparent in most markets and that doesn't seem to generally lead to anti-competitive prices. In fact, it seems to encourage companies to compete."

The problem imo is less about transparency and more about information asymmetry. It's asymmetrical that companies have access to literally what every other company is offering, while the employee is sitting there trying to guess based on glassdoor (which is utter shit information) and levels.fyi (marginally less shit?).

ADP has a product called compensation benchmarking which is very similar to how this is described.

They’ve had that product (with various names) for years.

No, this is not new. There are many many many companies selling compensation metrics. This is also not salary fixing. These companies typically do not offer recommendations. It's up to each individual company to decide how to structure their salary bands and how they want to stack up to the market.

Genuine question: What makes you believe that an employer would decide to pay you more when they notice that they're paying you less than other companies would? Why wouldn't they just think "Oh, neat, we got such a bargain!"

What stops senior devs in Germany from remote contracting for foreign companies that pay better?

If you're truly underpaid for your experience and location then you should be able to get a new higher paying job easily. And if you can't easily get one well maybe you aren't underpaid.

Companies compare pricing all the time even if it doesn't involve smoke-filled rooms with execs doing tit-for-tat. You don't think your local grocery store knows what the other local chain is charging (or what they're paying their employees)?

"Alright, pie, I'm just gonna do this...and if you get eaten, it's your own fault!"

[flagged]

FWIW, I believe RealPage works to lower rent. Every landlord wants to say, “We charge below the 50% mark”, thereby steadily lowering it over time.

"data are aggregated anonymously".. that's what almost every data broker with a security breach also said at one point in the past.

Realpage does the same thing with rental market data but they are clearly at risk.

Pave's data is _incredibly_ revealing. First of all it covers historical data for every single employee, secondly it includes stock as well. It also relates the compensation to performance.

Job listings is very different kind of data than compensation actually paid to employees.

https://www.ycombinator.com/companies/pave-2

Didn't they agree not to hire each other's employees? Which would serve to suppress salaries, even without sharing what anyone was getting paid.

> most companies forbid you from discussing your wages ....

Yes, but this interdiction might not be legal. Companies typically add such clauses to achieve a chilling effect. (Ie, you abide because you fear running a risk if you don't). Consult your legal representative.

An interesting artifact of the information disparity between the startup executives (who have access to this benchmark data) and the employees (who don't) is that the employee is often wildly off the mark in their expectations, either too low or too high.

There are so many variables at play too that it turns into a negotiation like everything else. Say an employee wants a big raise because they are having their first child are heading towards a higher cost base at home. Say the employer simply says "the salary data shows that your current pay is at the market average".

Well, is the employee truly "average"? Perhaps they're a high performer. Does the average number take into account not only the company dynamics (stage, domain, funding, revenue level, etc)? Not perfectly.

But then on the other side, just because an employee wants a higher salary due to a higher cost structure at home doesn't mean they are automatically entitled to it, right?

Then on the startup side again, the manager is looking at the data and thinking about all the time and cost of replacing this person and realizing it's likely more than the cost of just granting the raise.

Then the HR person comes in and says the salary grid -- whose whole purpose is to provide in theory tight constraints on these conversations -- rules this all out, there's no budget or wiggle room. When the Manager suggests the grid hasn't been updated in a few years, HR takes it personally and tells the person to take it up with the CEO.

So then the CEO gets involved. She knows the employee has a unique view on the technology and market direction and considers them Tier 1 can't-lose-them. She knows the grid is out of date. She looks at the data and thinks that she can justify to herself and the financial plan that it'll be OK to do it, with fingers crossed that this doesn't happen across the board because then their runway will shorten considerably.

So the raise happens.

My point is just that the salary information asymmetry is just one relatively minor aspect to this whole negotiation and in the end I'm not sure it advantages the company all that much.

I can recite at least five situations where "simply providing X with information" is considered a crime. One of them is company A providing planned price to company B in order to agree on it, and it is called price fixing. Other are insider trading, pump and dump, etc.

No. DoJ is suing RealPage because they used non-public, sensitive data to set rental prices in a way that reduces competition. Literally what these guys are doing.

Complaint: https://www.justice.gov/opa/media/1364976/dl?inline=&utm_med...

more readable Press release for DoJ on RealPage: https://www.justice.gov/usao-mdnc/pr/justice-department-sues...

A company doesn't need to know they are under compensating for a role from a third party. They'll find out by the quality and number of applicants pretty fast. I've seen this in practice directly when we couldn't hire for certain roles, raised the range, filled the spots.

On the other hand, to know that other companies are paying lower and still able to deliver roughly the same work is harder unless you know how much they are paying.

I think it's a pretty safe assumption that a company paying to gain information that gives them an advantage in negotiation isn't going to freely give up that advantage.

I've never run a company and probably have a chip on my shoulder, but I also think that it's a reasonable assumption that most employers want to pay as little as possible.

Obviously, this sort of information would always be used for good.

Extremely common practice.

Anybody else remember that time YC funded an international smuggling operation?

https://www.ycombinator.com/companies/backpack

https://news.ycombinator.com/item?id=8199286

Eric Schmidt echoed similar sentiment in his recent interview. Basically do it, if startup fails then it doesn’t matter. If it succeeds then lawyers can sort it out.

Ironically for a question about antitrust price fixing you just named two incumbent government-sanctioned cartels (zoning and taxi medallions) that restrict supply and keep prices high. They would be illegal if private companies made them.

> essentially illegal taxi and illegal hotel services

I don't know about Uber, but Airbnb deflects this by saying they are not in fact a hotel service. Rather hosts are hotel services, and Airbnb is simply a discovery platform matching buyers and sellers. It's up to an individual host to make sure they are complying with local laws including whether their city or district allows an individual to rent out their house or a room in it without a hotel license (this varies from city to city). In this way Airbnb (fairly or unfairly) pushes the burden and liability onto the hosts.

I believe this is also a huge reason why Uber doesn't want to classify drivers as employees because then it is the taxi service, whereas it could argue that the drivers are each operating their own taxi service and Uber is just a discovery and payment platform.

Taxi medallions were (and AFAIK still are) required to respond to people hailing a taxi from the street. It is not required to book a ride via phone or internet. Uber and Lyft drivers never needed taxi medallions.

uber: mostly not technically because the key thing is that they are not soliciting rides from the street, was my understanding.

airbnb had a much more legally tenuous start

How so?

Pave (and many other comp platforms) are prolifically used in the UK and across the EU because no individuals personal data is being shared. Pave doesn't get told 'louthy is a software engineer and gets paid £50k a year' - they get a list of job titles, seniority, and salaries but no identifiable data.

In the EU there are definitely companies providing aggregated salary band norms, in fact utilizing them is nearly required by upcoming EU directives as salaries must be justified by HR. In the Netherlands I know Bureau Baarda is gathering and selling data.

Been going on for a while:

High-Tech Employee Antitrust Litigation is a 2010 United States Department of Justice (DOJ) antitrust action and a 2013 civil class action against several Silicon Valley companies for alleged "no cold call" agreements which restrained the recruitment of high-tech employees.

<https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...>

Using a rent estimate would be a brilliant way to double-check if you are overpaying salaries. /s

It exists, many companies are using wage benchmarks to fix salary in EU.

Companies assume they don't need your approval to collect data on salary range for your position as aggregates are not directly pointing at you.

The OP specifically mentions that.

Soon you need to waive your class-action rights when applying for a job.

Real pages is such a gross business

This was the exact thing that popped into my mind when I read the poster’s description.

Reading that, seems like RealPage could protect itself from similar problems if they simply avoid using the same sales rhetoric, and don't do explicit recommendations. "You are paying way more for this position than others... hmmmm."

Surely they are aware of the similarities and are strategizing.

I understand why people assume we do that, but actually we do the opposite—that is, we moderate less when YC or a YC startup is part of a story. There is plenty of past explanation at https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu....

Note: we still moderate such threads. We just do it less than we otherwise would.

I thought this was a joke comment but I went back after reading the comments and it’s now on the second page already.

I really, really hope they don't.

> If a worker is working at a company A making $80k, and they try to get a job a company B making $90k, the owner of company B needs to know they were only making $80k at their last firm, so they can make a good offer of $85k. $10k would be too much.

I disagree wholeheartedly with this.

> secret database

> I don't see what the big deal is

Pick one... If there is no big deal, why would they want to keep the database secret? Also, do you have any source on that?

It doesn't really matter so much. Company B needs to know whether to beat an offer from company C for $95k or only $80k. Your salary history only affects employers that aren't trying to compete effectively, because what you made then isn't what you could make now.

And the end of the ZIRP-driven shortage is telling us that what we used to make is not locked in forever.

I am not a Lawyer, or a US resident but I highly suspect this behavior is completely illegal in Europe (and rightfully so in my mind).