Pay equity and pay disparity have achieved prominence in recent years following the recognition that, despite years of attention, inequities continue to exist—especially among women and people of color (POC). The intersectionality of pay equity and DEI (diversity, equity, and inclusion) represents the recognition that pay disparities such as wage gaps are influenced not only by gender, but also by various other dimensions of diversity such as race, ethnicity, age, disability, and more. It further acknowledges that employees may experience multiple forms of discrimination simultaneously which can compound the barriers and inequities in compensation that continue to exist, including intersectional discrimination. Addressing these issues requires a comprehensive approach that includes promoting equal pay and striving for inclusive compensation practices.
DEI and pay equity re inseparable. Solve for one and you’ll solve for the other. By shedding light on this connection, we can emphasize the importance of addressing pay disparities within a broader framework of inclusivity and workplace fairness.
Progress requires a strategic approach with measurable outcomes. Here we take a look at seven metrics organizations can use to measure their DEI progress which will directly impact gender and racial equity in pay.
Representation
Representation metrics simply track the diversity of employees across various dimensions like gender, race, ethnicity, age, or disability. By collecting demographic data and analyzing representation at different levels and departments, organizations can assess the effectiveness of their recruitment and retention efforts among and between specific populations. Monitoring this data over time can help to identify trends that may indicate either progress or areas of opportunity for improvement.
Pay equity
Pay equity is a crucial metric in evaluating an organization’s commitment to fair compensation practices. It involves conducting regular pay analyses to identify and address any pay disparities based on gender, race, or other demographic factors. Monitoring pay equity demonstrates a commitment to ensuring equal opportunities and fair treatment for all employees. Regularly reporting on these findings can send a clear signal to employees that the organization takes these disparities seriously and is committed to doing something about them.
Retention
Retention rates measure who is staying with an organization and for how long. Monitoring retention rates across different demographic groups can help companies identify if certain groups are disproportionately leaving the organization, which may signal potential issues related to inclusion or bias. Tracking retention also can inform targeted strategies to enhance inclusivity and support the long-term success of diverse talent.
It can also be helpful to track when certain demographics may exhibit lower retention rates than others. For instance, are people of color more likely to leave within the first six months of employment? Are white males most likely to have the longest tenure with the organization?
Promotions
Hiring diverse team members is an important first step. Often, though, those diverse team members may languish on the front lines–or leave. Monitoring promotions and tracking trends in movement among various demographic segments can help organizations ensure that their promotion practices are equitable.
Leadership Pipeline
One of the drivers of the lack of diversity in the top ranks of many organizations is the lack of diversity in the leadership pipeline. Women of color are particularly underrepresented when compared to white men, men of color and white women. This can be a key metric to monitor to help boost those numbers. As the saying goes: “what gets measured, gets managed.”
Employee engagement
Employee engagement surveys can provide insights into the experiences, satisfaction levels, and sense of belonging among employees. By including DEI-specific questions, organizations can gauge the inclusiveness of their work environment, identify areas for improvement, and measure the impact of their DEI initiatives on employee engagement.
In addition to surveys, other metrics—e.g. retention—can also yield insight into engagement, or lack thereof.
Leadership accountability
This metric evaluates the extent to which leaders champion and actively support DEI initiatives. Assessing leadership accountability involves tracking their involvement in DEI activities, their commitment to fostering inclusive cultures, and their role in driving diversity in leadership positions. This metric underscores the importance of leadership in promoting lasting change and building a merit-based culture.
Achieving pay equity through a DEI lens requires a comprehensive approach. Organizations must consider intersectionality, conduct pay analyses, promote pay transparency, and establish accountability. It is essential to recognize that pay disparities exist across multiple dimensions of diversity and to address systemic barriers to create a fair and equitable work environment.
Measuring DEI progress is vital for organizations committed to building inclusive cultures and reaping the benefits of diverse talent. DEI is directly tied to pay equity. The intersectionality of the two, as we’ve seen, can help companies pinpoint opportunities for improvement, improve their outcomes, and strengthen their culture, brand, and overall organizational success.
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