Pay Equity

The National Committee on Pay Equity has concluded that ‘pay equality’ for women will not be achieved until 2059. Ensuring that a company’s pay structure is fair and equitable to women and minorities is difficult. Wage discrimination is difficult even to discern unless it is overt.

Inequitable Practices

Gowri Ramachandran, professor at Southwestern Law School, writes that “Title VII prohibits both intentional and unintentional discrimination of wages … wage gaps can occur even when NOT rooted in intentional discrimination … but can occur due to socialization of women and people of color to negotiate less aggressively.”  This may be considered an unintentional form of an unfair pay structure. Clearly, this would be an area that requires attention.

Another factor that requires consideration is systemic compensation discrimination where there are clear disparities based on race and/or gender between similarly situated employees.  Other things, for example, how the organization evaluates work experience, education, performance and productivity, are legitimate factors in evaluating compensation.

How to Ensure Pay Equity in Your Organization

The National Committee on Pay Equity has a Ten-Step Guide to evaluating pay equity. This is a self-audit to help you ensure that salaries and benefits are in-line with industry standards, that all jobs have proper descriptions, and that evaluations of job performance are consistent.  These are all areas that require considerable attention.

As a consultant, I am inclined to look at job application ratios (a review of applications received against those who have been hired), as there is often overt bias from the beginning of the hiring process. I would also be looking to see if the above practices are incorporated in your business.

Lee S.

Photo: Nick Youngson CC BY-SA 3.0 Alpha Stock Images

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