Survey Finds Organizations Should Be Conducting Pay Equity Analyses

WorldatWork directed a survey to evaluate the current state of pay equity-related work. In the survey, WorldatWork posed questions about causes going beyond salary that contribute to potential inequities, such as representation in the workforce, benefits programming, and culture.

The survey concluded that analysis of gender pay gap and broad pay equity is becoming standard practice for many organizations. Remediation efforts are not far behind this trend. Out of the 352 members that participated in the survey, 79% said their companies conduct pay equity analyses as a standard business practice, while only 9% said gender pay analysis is not on their organization’s radar.

Four of the top five areas that organizations continue to examine for bias are recruitment and hiring practices. The other areas being examined for bias are individual pay determination decisions, diversity and inclusion programs, and selection practices.

Nearly two thirds of survey participants concluded their companies are considering performance management practices in context of pay equity work, which is surprising because programs like these are often subjective. Performance management practices will need to adhere to frameworks in the future to insure they are bias-free.

Only 11% of companies represented in the survey said they consider benefits programs and other care programs when looking to identify potential areas of bias or factors in pay disparities.

WorldatWork suggests organizations drill down into pay equity data and look beyond the surface at the numbers. They give an example that is popular in the news: women earn 80 cents for every dollar a man makes. This figure is typically arrived at by taking average wage differences between men and women across industries. To achieve pay equity, organizations should go deeper than average wage differences and use regressions and other statistical analyses. By doing a deep analysis, organizations can ensure the correct measures are taken to solve for inequities.

Without a widespread commitment to pay equity analysis, it is estimated that the United States will take another 208 years until we reach gender equality. Organizations should make data analysis surrounding pay equality and closing the wage gap a top priority. This will not only save organizations money in the case of a discrimination lawsuit, but also help further employee morale and business ethics.

Learn how a pay equity audit has affected other organizations in a report by Harvard Business Review Analytic Services, done in association with Trusaic by clicking here.

To learn more about achieving pay equity, click here.