Mia
You’ve likely been hearing more about pay equity over the past few years. This is because the idea of pay equity continues to become a more pressing concern with the passage of time. While there have certainly been gains made in terms of pay equity, there’s still a long way to go before achieving true parity. The three-step approach to ensuring pay equity allows enterprises to achieve higher standards in this regard.
What Is Pay Equity and Why Does It Matter?
Pay equity is the idea that people’s compensation should have no relation to demographics like race and gender. While this might sound obvious, it’s unfortunately still not the case in the average scenario.
In fact, despite broad gains in some categories over the years, there are still massive discrepancies in comparable pay based on gender and race. In the U.S. today, Asian men actually make the most on average, followed by white men, which has traditionally been the highest-paid group. Even though women have seen some progress in terms of closing their wage gap, they on average earn only about 82 cents for every dollar of a man.
At the same time, there has been a stagnation in relative pay along racial lines, where black and Hispanic individuals have been right around 70 percent of their white counterparts since at least the 1980s, according to data from Pew Research Center. This suggests that there is ripe need for more effective and appropriate measures for ensuring pay equity at organizations. With this information in hand, there’s no excuse for delaying the transition to more fair pay practices.
Pay equity isn’t just important because treating people equally is right and doing otherwise is wrong. It’s also increasingly a legal concern. There are federal and state laws that dictate the rules on pay equity. There have been some cases in recent years where businesses have been required to make large payouts in lawsuits. Conducting pay equity analysis as a part of regular operations can help organizations avoid these issues by proactively recognizing and alleviating disparities.
The Three-Step Approach to Ensuring Pay Equity
If you want to guarantee a fair workplace for all, there’s no option but to dig down into the realities of how pay is distributed to each individual employee. Doing this requires an immense effort, as you’ll need to collect and analyze data from your whole workforce in order to identify and remediate any inequities.
Performing pay equity analysis, or a pay equity audit, is an essential part of ensuring pay equity within an organization. This can be done through internal means, but will be incredibly challenging for most firms to do in any meaningful way. Going alone here can often lead to failure fatigue and, ultimately, abandonment. Therefore, identifying a pursuing a pay equity consulting partner can be a wise choice. Mercer, for instance, takes a three-step approach to ensuring pay equity. These are their steps:
- The best of consulting and technology – Resolving pay equity issues isn’t just a one-step process. It’s going to require approaching the problem from multiple angles. The first step is offering deep expertise in pay equity remediation solutions, and combining it with the tools that can help uncover any pay discrepancies.
- Utilizing deeper analysis – For a full treatment of pay equity issues, it’s important to work with individuals who have specialized knowledge in specific areas. Interacting with the right people can create a deeper level of understanding than of what can be achieved otherwise.
- Pay equity calculator – Intuitive tools for a broad range of users can help uncover areas of concern. By utilizing a pay equity calculator tool, it’s possible to visualize and plan different ways to adjust pay in order to meet remediation goals.
Ultimately, you need your pay equity strategy to be sustainable. This is much more attainable when partnering with a consulting firm.
Now that you know the three steps to pay equity, it’s time to realize their potential at your enterprise. Fully committing to pay equity standards will be beneficial to your cause in the long run, and make your organization a better workplace.
