HRA Blog

Gender Pay Equality – Are We There Yet?

Written by Tiffany Aukema on .

Last week, Hilary Clinton became the first woman to claim the status of presumptive nominee for a major American political party.  This week, top female influencers in business, politics, entertainment, and the arts met in Washington, D.C. as part of the White House United State of Women Summit.  The summit was designed to celebrate what women have achieved to date and how they are going to take action moving forward.  On the same day as the summit, President Obama announced that the historic Sewall-Belmont house on Capitol Hill will be a national monument in tribute to all those who have fought for women’s equality.  Sounds like exciting times for women.  Are you aware that April 12 was designated Equal Pay Day?  Wait, what?

Equal Pay Day is not a celebration, but rather a public awareness event to illustrate the wage gap between men and women.  This day fluctuates every year and represents how far into the year women must work to earn what men earned in the previous year.  Currently, women earn $0.79 for every dollar their male counterparts earn for the same job.  This gap is even wider for minority women.  In 1963, when JFK signed the Equal Pay Act to address this pressing issue, women earned $0.59 for every dollar their male colleagues earned.  Improvement has been made; however, 20 cents in over five decades is hardly significant or acceptable.  According to the Institute for Women’s Policy Research, if this trend continues, women will not earn equal pay until 2059.

While the issue continues to garner attention in the White House and on Capitol Hill, employers can take control and ensure they aren’t contributing to the problem. Here are a few things that employers can do to ensure equity:

  1. Be transparent: Transparency in how an organization makes pay decisions is a simple and effective way to alleviate employee concerns of unfairness and inequities. Establish compensation ranges that are consistent.  Communicate the criteria to employees so they understand how salaries are determined.  Employers should perform regular analysis on salaries.  Often there are reasonable and appropriate explanations for gaps in salary; however, employers should be proactive in ensuring inadvertent pay gaps between gender aren’t being created.
  2. Encourage and be open to discussion: Employees are often reluctant to discuss salary with their managers for fear of retaliation or being seen as a complainer. Employers should encourage open, but private, discussion on compensation between managers and employees at least once per year.
  3. Allow for negotiation: There is a stereotype that women aren’t capable of effective negotiation when it comes to salary. Fast Company posted an article on this topic citing a study published in the Journal of Personality and Social Psychology which found that, “women tend to be more timid when negotiating on behalf of themselves, fearing backlash, but are effective when it comes to negotiating on someone else’s behalf.”  In response to this and in order to help alleviate wage gaps across an organization, some firms have adopted a ‘no negotiation’ practice. While the practice has positive intent, it may contribute to the wage gaps. Employers should be open to negotiation and allow employees to have some control in determining their salary.
  4. Skip the salary question: One of the most frequent questions during the application and interview process is, “How much are you currently making?” While employers may find this question useful in determining the experience level of a candidate, it also may be contributing to the wage gap.  If a female employee was underpaid in her previous position and a new employer uses this salary as basis for a hiring salary, she is automatically disadvantaged in contrast to her appropriately paid male peer.
  5. Provide leave options and flexible schedules: In general, the wage gap widens as workers age. This may be attributed to the fact that many employers don’t provide adequate time off for maternity and parental purposes forcing women to step out of the work force to tend to family needs.  Consider offering more generous leave options and flexible schedules for parents to encourage women to stay in the work force and stay active in the wage game.
  6. Ensure equal distribution of work: We all have unconscious biases that may lead us to assign work the employees we relate to most.  If the best work assignments are always given to the male employees, the female counterparts are denied the opportunity to demonstrate their true worth.
  7. Educate your staff: Lastly, but most importantly, educate your staff. President Obama created the National Equal Pay Task Force to bring together the EEOC, Department of Justice, Department of Labor, and the Office of Personnel Management to help understand the full scope of the wage gap, enforce current laws already prohibiting pay discrimination, and ensure employers and employees are educated on rights and obligations.  Keep abreast of this topic.  Train your leaders about the unconscious biases and communicate clearly about how your organization makes pay decisions.  There are many great resources on this topic.  The Society for Human Resources published a relevant article in the June 2016 HR Magazine, “9 Tips for Closing the Gender Pay Gap.”  In an effort to keep abreast of issues, employers can visit whitehouse.gov and unitedstateofwomen.org for the most updated information.

The year 2059 is a long way off.  This isn’t a male/female issue or a company/employee issue.  It’s doing what is right for your business by doing what is right for your employees.  Compensating your employees equitability and competitively, regardless of gender (or race, or sexual orientation) will help you attract and retain a talented workforce while providing an environment where everyone feels valued.  And in an election season when there’s so much talk about winners and losers, isn’t it nice to have both sides win?