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How to Boost Pay Equity Efforts in Your Organization

How to Boost Pay Equity Efforts in Your Organization

Pay equity is an ongoing concern in the modern workforce, and despite small improvements, many employees are being paid vastly different wages in similar lines of work. Organizations must continue to invest in systems that can effectively battle pay equity concerns to create fairness and satisfaction among all employee groups. Luckily there are initiatives your organization can employ to get started now.

Read on to learn how to combat pay equity concerns within your organization.

 

Refresher: What Is Pay Equity?

Pay equity refers to pay structures intended to eliminate gender- and race-based discrimination and bias when compensating employees who have similar job functions.

Cheryl Pinarchick, an attorney with Fisher Phillips in Boston, explains, "By ensuring employees are paid equitably, employers can increase efficiency, creativity, and productivity by helping to attract the best employees, reduce turnover and increase commitment to the organization." 

Organizations must begin looking closely at these equal pay measures to ensure they set themselves up for success. Not only does equal pay matter for the sake of equal opportunity in the workplace, but it also affects the overall quality of work an organization can produce. 

 

How Can Transparency Improve Pay Equity?

Compensation transparency is a strategy that allows organizations to openly discuss pay and salary information as a step toward pay equity. While the strategy is universal, utilization may vary in both scope and degree. For example, one organization may decide to disclose all pay information to employees, while another may choose to open compensation numbers up to the general public. 

The hope is that compensation transparency will help to eliminate wage gaps and lead to less employee exploitation. This, in turn, could help promote more trust and confidence in their organizations while boosting overall employee satisfaction. 

This idea of pay transparency has already begun to take root in some organizations. Megan Smith, VP and head of HR at SAP, said they introduced a new pay transparency tool that allowed employees to see their salary and what a bump would look like at different levels and for various roles within the organization. 

At BerniePortal, we use a system that monitors employees' skills, scope of responsibilities, and years of experience. Employees can clearly see the qualifications and skills they’ll need to develop in order to increase their pay level. In addition, as BerniePortal gains experience and becomes “80% comfortable” with what a given category of roles entails and the skills required, the organization constructs documentation to illustrate what career and compensation growth looks like for that category of roles. 

 

How Can Organizations Re-evaluate Pay Equity Policies?

Evaluating pay equity doesn't need to be reserved solely for year-end reviews. Consider evaluating pay structures every few months to ensure you remain ready if changes are needed.

Revamping a pay equity policy can take time and typically doesn't happen overnight. Legal hurdles and implementation efforts need to be well understood and established before the new systems can be expected to take effect. That said, organizations can proactively make changes to improve their pay equity efforts. 

Here is a list of actionable steps you can take to create greater pay equity within your organization: 

  1. Research. The first step is to determine the average salary for a given position within your industry and understand how a competitive salary looks. 

  2. Define your efforts. To improve pay equity within your organization, you must clearly define your pay structure. How do you want pay increases to work at each level of employment and for each position? It can help to create a document showcasing what employees need to accomplish or achieve to increase their salary and professional level.  

  3. Evaluate the process. You need to understand how a transparent compensation model will affect the overall budget. Be prepared to account for increases in salary as employees improve their professional levels. 

  4. Understand the hurdles. Employers need to be conscious of the legal limitations of altering pay adjustments. Companies must meet with legal teams and gain counsel to determine whether adjustments are lawful. This can take time and should not be rushed. 

  5. Be proactive. If a model needs to be updated, be proactive in making those adjustments. Transparency and other pay equity efforts need to evolve with the organization. If the system isn't working, don't waste efforts on keeping it afloat—instead, transition to a system that better accommodates your needs. 

 

Additional Resources

You can also stay informed, educated, and up-to-date with pay equity and other important topics by using BerniePortal’s comprehensive resources:

  • BerniePortal Blog—a one-stop-shop for HR industry news

  • HR Glossary—featuring the most common HR terms, acronyms, and compliance

  • HR Guides—essential pillars, covering an extensive list of comprehensive HR topics

  • BernieU—free online HR courses, approved for SHRM and HRCI recertification credit

  • HR Party of One—our popular YouTube series and podcast, covering emerging HR trends and enduring HR topics 

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