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How to Make Sure "Binders Full of Women" Get Equal Pay

Should the Government Play an Active Role in Closing the Wage Gap?

Politics. Women. Money.

When you’re talking about those three subjects, you’re either watching a Presidential debate or sitting at a very interesting dinner party.

One of the hot topics coming out of the October 16 town hall presidential debate was the subject of fair hiring practices for women. As Mitt Romney told a story about his push to hire more women in his cabinet, he uttered the phrase “Binders full of women” in reference to the stacks of resumes of qualified candidates that were brought to him.

And just like that, faster than a video of a cat dancing Gangnam Style, an internet meme was born, launching discussion around the #bindersfullofwomen hashtag on Twitter and mock accounts across the social web.

I think this is a very important issue, and if a funny phrase gone viral is what it takes to bring attention to it, so be it. However, I think most people would agree that it’s not a good idea to sit back and wait for the government to solve their problems – be it around this topic or any other, Republican or Democrat.

And like any good debate, where data from both parties is relentlessly scrutinized, a 2011 article on CBSNews.com titled “The Gender Pay Gap is a Complete Myth,” lists eight reasons why there might not be a gap at all, and the Wall Street Journal online featured the story "There Is No Male-Female Wage Gap."

Bottom line? Every situation is different, and like a good politician, the numbers can be massaged in different ways.

So what are two things an employee can do, and how does the government play a role?

1. Adopt a "gig mindset"
Our country has entered into a new workplace dynamic, where lifetime employment in the same industry followed by a pension and a cushy retirement are gone. The new economy is fueled by nimble employees with diverse skills that can adapt to a rapidly changing environment. 

Forbes.com quoted a survey by Future Workplace saying that 91% of Millennials expect to stay in a job for less than 3 years -- meaning they might have 15 – 20 jobs over the course of their working lives.

In her book "The Finch Effect," author Nacie Carson talks about the rise of the gig economy, where people are piecing together multiple, unrelated projects to create a career versus relying on a sole employer. She cites a survey by TheDailyBeast.com where one third of the 500 people they spoke with used a gig structure, claiming to earn more than $75,000 doing so.

While it's true that many people have been forced to take on multiple jobs due to the decline in the economy, in a "survival of the fittest," others have recognized the changing landscape and taken matters into their own hands, choosing to rely on themselves, not their employer or the government.

These people started online businesses, built a community, created a brand, and marketed their services using tools such as WordPress, Twitter, Facebook, YouTube, Google, and Paypal to name a few. These can be men or women, young or old, from the recent college grad learning how to code an iPhone app to a mommy blogger selling crafts in her spare time on Etsy.

But as these entrepreneurs use social media platforms to spread their own message, they can also use it to speak to the government when they feel threatened. 

When Congress proposed a bill called the Stop Online Piracy Act (SOPA), people responded. With community-based site reddit.com leading the charge, they argued that it would cripple the Web and kill jobs. The topic ballooned into an all-out movement, with rallies, petitions, the blackout of an estimated 7,000 websites, and a reported 7 million signatures collected by Google.  

2. Become a better negotiator
As the COO of Facebook and former VP of Global Sales and Operations at Google, Sheryl Sandberg is one the most respected women in business. In her TED talk “Why we have too few women leaders,” she cites a study that 57% of men negotiate their first salary, while only 7% of women do the same.

In their book “Women Don’t Ask,” authors Linda Babcock and Sara Laschever refer to a social experiment where men asked for more money nine times more often than women.

Fortunately, becoming a better negotiator is a skill that can be learned, and when combined with the number of job changes young workers will go through as mentioned above, can lead to as much as $1 million in extra earnings over a woman’s career.

Part of the problem with negotiating salary is that the entire process can be a complicated, multi-layered game of cat and mouse. While learning the skills to navigate this process can lead to huge wins for an individual that has done their homework, the bottom line is that the vast majority of job seekers are at a distinct disadvantage to the hiring company.

Three factors working against a woman trying to negotiate:

  1. The salary for a new job is unknown, forcing them to estimate their worth
  2. Companies often make an offer based on the salary of a previous job, where they might have been underpaid
  3. Women are often in the dark when comparing their salary to their male peers

Here is a place that the government could help.

Katie Donovan, a Salary Coach and Equal Pay Advocate at Equalpaynegotiations.com, has put together a petition on Change.org titled the “Salary Disclosure to Promote Equality Act.

The petition asks Congress to create and pass a law that:

  • Requires inclusion of the pay range for all job postings for public and private sector jobs
  • Disallows a requirement for applicants to share salary history
  • Prohibits past employers from sharing a previous employee’s salary history
  • Allows employees within the same company to share salary information without fear of dismissal

I have to say, this would be a real game-changer. 

Imagine a scenario where a woman is making $50,000 and is interviewing for a job where the company is willing to pay $70,000. During the interview, HR asks what her current salary is and she says $50k, or asks what she is looking for in terms of pay and she says $60k. In both cases, the company will probably offer $60k. 

While the candidate might be happy due to the $10,000 raise, in fact she effectively LOST $10,000.  Under this law, the company would need to advertise the job at $70,000, and would not have been able to ask the candidate her past salary, which would even the playing field.

Said Donovan, "Women's equal pay in theory was fixed almost 50 years ago when the Equal Pay Act was signed by President Kennedy. Unfortunately, the secrecy around salary and the advantage employers have in negotiating pay makes it virtually impossible for anyone to truly know if their personal compensation is equitable. Although the numbers do show a gender salary gap, many women believe it doesn't affect them and many men believe it is made up. I started this petition to help shine a light on the truth."

And thus the debate is on. What role should the government play in closing the wage gap?