# Hot Take — Let's talk about pay, with Rameez Kaleem

- **Episode:** [214](https://agents.truthliesandwork.com/episodes/214.md) (2025-07-15)
- **Type:** hot-take
- **Tags:** pay, compensation, behavioral-science
- **Time:** 21:12–36:12 (start 1272s)
- **Listen:** [https://truthliesandwork.com/214?t=1272](https://truthliesandwork.com/214?t=1272)

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[21:12] Al Elliott: We actually have a lot in common. We both use behavioural science to help people do better. Better at work
[22:15] Al Elliott: It can
[22:22] Leanne Elliott: But come back
[22:23] Al Elliott: Yeah, come back. Definitely come back because Nudge isn't as good as this. So come back. I'll cut that out. Keep that in. Welcome back. It is time for our Hot Take where we ask— what do we do on the Hot Take, Leanne? I've forgotten
[22:39] Leanne Elliott: We ask our guests to challenge the way we think about work
[22:42] Al Elliott: Yes, we do. And today is something that every single employee wants to tackle. That is how much they get paid, because most companies say they want to be fair, but it's very difficult to justify the decisions they make around how much they pay and who they pay
[22:57] Leanne Elliott: Our guest today is Rameez Kaleem. He is the founder of 3R Strategy, a consultancy that helps organisations build fair, transparent, and well-communicated pay structures. He spent 2 decades working in pay and reward, and he says the issue isn't just how much people earn, it's whether they trust the process behind it
[23:15] Al Elliott: So let's go and join Rameez and find out why pay transparency isn't just a legal or ethical issue, it's a cultural issue
[23:22] Rameez Kaleem: My hot take today is that if you look at new graduates and upcoming graduates, around 85% of them are saying that they're less likely to apply for a job where the recruiter doesn't mention the salary range. And we've seen this data is higher for Gen Z employees. And so, our ability as an organization to attract candidates is significantly reduced if we're not transparent about pay. In the past, we've always, you know, when we go to a job ad, we always see those words, competitive pay, which can mean anything. And the way that the pay for the role is often decided or has been decided in the past is we then ask a candidate to say, what is your current salary? What do you expect? And then based on their expectations, based on their current salary, a salary range is provided to them. And I think we've seen that change because a lot of organizations are, some are being forced into it because you see some websites saying that they're not going to publish any job ads if there's no salary range. And then we're seeing legislation come in, for example, in the US, across the EU, that are forcing organizations to do this. So, some organizations are still reluctant, but we're seeing many more organizations do this than they have in the past
[24:42] Al Elliott: If I had a small business and I didn't have a huge budget for a role, I'd be very wary about putting the pay range on there because it's going to be smaller than working for IBM, for example. What do I do in that situation?
[24:55] Rameez Kaleem: I think candidates realize that if you apply to work for a small organization, Again, I run a small organization. There's 9 of us, and we do some of the work that might be done, for example, by PwC or Mercer, and we're not going to be able to pay those salaries. But when people apply to work in smaller organizations, what they realize is that instead of the higher salary, they might be getting other things that they value more, which is flexibility, Possibly a nicer working environment, not having to give up their weekends and their evenings, and more development, being able to work in wider projects. So, there's different priorities when we look at the data. And I shared the data with you around graduates and recent graduates, and that's obviously a younger generation. And you look at numbers of 85%. If you looked at that across the population, that might be more like 50%
[25:55] Leanne Elliott: Yeah
[25:56] Rameez Kaleem: So, there's definitely a generational difference, but that doesn't mean that there isn't a higher expectation now, even from Gen Y employees or baby boomers, that they are expecting more from their organization. But I think Gen Z in particular, research has shown that they're the first generation that is willing to compromise on pay or to accept a lower salary to work in an organization where they feel a sense of purpose. And they see much greater transparency. I've spoken to HR directors where they've said to me, we have people applying for jobs that might have a particular salary and they, it says, you know, you need to be in the office every day. And what some candidates, and particularly Gen Z, might be saying to them, you know what, I would be willing to accept a lower salary than this if you allow me to be flexible and work from home most of the time. or hybrid working, working from home 3 days a week. So, there definitely is an employee population, particularly the younger generation, that is willing to sacrifice on pay because they see having a sense of purpose, they see transparency, they see a good working environment as a higher priority than getting that much higher salary
[27:13] Al Elliott: So, you alluded to before that there's been some legislation around this
[27:16] Rameez Kaleem: California, New York, and in fact, more than 10 other states have started to do this in the US. So, Many states in the US have decided to do this, and it's, you have to publish salaries on job ads, and it's about not asking candidates about their current salary or their salary history during the recruitment process. And in fact, research in the US found that the single biggest factor that led to an adjustment in the gender pay gap was eliminating that question in interviews of what is your current salary? Because then decisions were being made more consistently. You know, what tends to happen is, let's say you are underpaid in your current job, whether it's due to ethnicity or gender, and then your employer asks you what your current salary is, and they make an offer based on that current salary. All that happens is we're transferring that inequity or discrimination from one organization to another. So that is a big part of legislation in the US, and we have the EU Pay Transparency Directive coming in
[28:17] Al Elliott: Yeah
[28:20] Rameez Kaleem: which is going to be effective from June 2026, which means across Europe, all the EU countries will have to do both of these things
[28:28] Al Elliott: Can you see it coming into the UK anytime soon?
[28:31] Rameez Kaleem: So there's 2 parts to this. One is if you have an organization that is based in the UK, but they have employees across Europe as well, they will have to do all of this for the European employees. And a lot of organizations are saying, They don't want to treat their UK employees any different from the European employees because otherwise they're gonna feel, oh, this is not fair because my colleagues are able to see this information. And then the other part is, you know, we now have a Labour government that says they want to align more closely to Europe. So I don't think they're going to, because the EU directive is probably the biggest change I've seen in the last few decades to how organizations have to manage pay. So I don't think the UK is going to suddenly adopt all of it, but I would expect that they might start bringing in parts of the legislation
[29:20] Al Elliott: I'd imagine if I was advertising for a job, I'd be like, right, okay, they're going to be my content manager. I'm like, how the heck do I find out what a content manager should be paid?
[29:31] Rameez Kaleem: What a lot of HR teams and organizations will do Well, they would go online and they will look for a content role and see what the salaries are. And they might be going on Indeed, Glassdoor, other recruitment surveys. But I always say to those organizations, you know, when we do this, all we're saying to the employees is, and if there's a disagreement on pay, that our internet research is better than your internet research because that data is the same data that employees have access to. So what we always suggest is to use salary surveys that are formal surveys that are not based on advertised salaries, but they're based on actual salaries of employees
[30:17] Al Elliott: What happens if there's pushbacks, the CFO pushing back? Are you seeing that? And if so, how do I defend my position that I want to pay a certain amount?
[30:25] Rameez Kaleem: There isn't a lot of investment to be made. There are obviously some adjustments to be made. Because there might be equal pay risks because people are significantly underpaid. But ultimately, whether it's Gen Z or any employee, what they want to know is that, are we being treated fairly? And it goes back to people are less interested in what everyone else is earning around them, but they want to know, is there a process in how you're deciding pay for me? And that's the same process for everyone else. So that we are being treated fairly. And then once we start sharing the context around how we make pay decisions, we start sharing with them the pay approach to pay is equitable, and that helps to build trust with them. And once we have that trust, what people tend to do is they start to not focus on what they get paid, but they just start focusing on doing a good job for you. I feel the topic of pay transparency is so important. It can sometimes be confused with Pay disclosure. So if we talk about pay transparency to some business leaders, they'll say, well, I don't want everyone to know what I get paid, or I don't want my colleagues. But that's not what pay transparency is about. Pay transparency is about giving people context, treating them like adults to say, this is how we make decisions. And, you know, making sure that they realize that the pay is managed in a fair and equitable way. And it's not a case of—
[31:50] Al Elliott: Yeah
[31:51] Rameez Kaleem: It's not a binary issue of you either have it or you don't
[31:54] Leanne Elliott: It makes you wonder, doesn't it, Al, like why some employers are still reluctant to list salaries when all the data suggests that it's good for them and all the people want it. It kind of, it kind of makes you think that it can only be for a shady reason
[32:09] Al Elliott: Well, yeah, for shady reasons, but also like think about when you're buying cars recently over the last sort of 7, 8 years in the UK, certainly, but I think in the, the US. There've been lots of companies who come up, um, who are saying, we are very transparent about our car prices. The olden days when you got some dodgy guy with a fag hanging out of his mouth— sorry, that's a cigarette, for just in case you don't know what I'm talking about in the US— a cigarette hanging out the mouth going, how much you want to pay? You know, oh, we'll do you a good deal. Those have gone. So I feel like, I feel like that has been revolutionized, but we've not yet tackled the sort of pay transparency side of it
[32:42] Leanne Elliott: Yeah. And I think that's kind of the the crux of it, isn't it, really? That, as Rameez was saying about Gen Z and their need for transparency— and I think this has also kind of been bubbling with millennials and probably younger Gen X as well— because there's been so much disruption and so much ambiguity and so much turbulence in our working lives that we just crave some kind of transparency, some kind of control or clarity wherever we can get it. And I think it's absolutely true as well, um, with what he was saying around, um, the world of work has fundamentally changed. People might, may well be happy to take a lower salary if it allows them more remote working and flexibility. And that just makes sense. When I was, when I was doing my biggest commute, I was spending about £130, £140 a month on travel. And that was back in like 2011, 2012. Yeah
[33:37] Al Elliott: It'd be easy double now
[33:37] Leanne Elliott: Yeah, triple. It's a lot. So, so yeah, I can, I can see why that would be a factor as well
[33:43] Al Elliott: And there's so much in the news about people hiding stuff and, you know, not being honest about stuff. So you immediately think if someone's not being honest or won't be transparent about their pay, what else are they not being transparent about? Which gives you such an opportunity to flip that on its head, to be able to say we are transparent. Like Geoff Roberts, phenomenal guy, currently travelling his way around Europe, some of the most amazing places. He keeps sending photos of, but he's from Outsetter and they've got such a transparent way that everyone earns money and equity and can just work 1 day a week or 6 days a week or whatever they want. There's the other guy, I don't remember his name, but do you remember about 4 or 5 years ago when he said he paid everyone $72,000 a year?
[34:18] Leanne Elliott: Yeah, yeah, yeah, yeah
[34:20] Al Elliott: And so you kind of feel, oh, well, I trust them. So even, even if it's gonna cost you a few thousand more to, to, to make sure everyone's on equal footing, the transparency means that people are gonna naturally trust you more. And as we learned before the break in Leanne's segment, when people trust you, Then they're much willing to forgive you if something doesn't quite go right
[34:40] Leanne Elliott: Yeah, absolutely. And I think in terms of like, this is all very much steeped in research as well. This is what psychologists call organisational justice, and it's as much about understanding the reasons why a decision was made. Um, so it's not necessarily a case of, of having transparency to the, the level that Al just mentioned, that everyone is paid the same amount. It's transparency around how salaries are calculated, how they're decided, how bonus structures work, how promotion or salary bands and how you move up in them, how that works. All of that feeds into organisational justice, and without organisational justice, we can very quickly feel very detached from an organisation, not want to put in extra role effort, and really, it's usually a— yeah, it's the start of disengagement. If we don't trust our organisation, then that relationship isn't going to go very far, is it, Al?
[35:28] Al Elliott: Absolutely not. I know you did a bit of work with the NHS about 15 years ago, and that was making sure that everyone was getting paid the same, but that was just too much, wasn't it? They went too much the other way so that people, it was more of a fight to get what you're worth rather than letting everyone know
[35:42] Leanne Elliott: Yeah, there was the odd person who knew how to, um, how to rig the system as well, which I respect, but yeah
[35:47] Al Elliott: Was it the, uh, was it, was it the equivalent of Sohel? Soham?
[35:51] Leanne Elliott: Yeah, yeah, yeah. Pretty much. Pretty much
[35:53] Al Elliott: But yeah. Okay. So all the links to Rameez are in the show notes. I suggest you go and check out his website. Um, and Also, he's just got, he's got so much experience in this, in this field. He's such a measured, calm guy. He's got a book out, which I thought was about to come out, but actually it actually came out a year or so ago. So you can go and buy it right now. Check the show notes. The links will be in there