Bersin Pay Equity Maturity Model: Level 1 – Compliance-Driven Process

The Josh Bersin Company developed a guide for employers to better understand pay equity. The goal was to create a roadmap for achieving pay equity, identify where your company is in its pay equity journey, and define actionable steps toward excelling in pay equity.

The maturity model proposed by Josh Bersin involves four levels. In this article, we’ll discuss the first: Compliance-Driven Process. From the study, commissioned by Salary.com, they found that 50% of companies currently find themselves at this level. Are you one of them?

What is Level 1 – Compliance-Driven Pay Equity?

The companies that find themselves at level one of the maturity model typically have no expertise in pay equity work. They aim to avoid legal or reputational concerns, hence the name compliance driven. Here’s a list of characteristics to help you identify whether you’re at this level or not:

• Sporadic pay equity review process
• The legal department is responsible for the review.
• Elementary statistical approaches to determine pay gaps.
• Only consider base pay – not bonuses, benefits, or other rewards
• Employees and managers aren’t familiar with the pay equity process.
• Little to no communication about pay equity.
• Rudimentary actions to address pay gaps.

Why It’s Important to Move Past Level 1

As mentioned in the points above, though pay gaps are being identified, these employers don’t determine the root causes. Therefore, pay equity issues will repeat as soon as a new hire, promotion, or lateral move occurs. Companies addressing pay equity at this level miss the broader opportunity to create a diverse and inclusive workplace.

In today’s market, it’s difficult for a business to see successful and innovative outcomes without proper pay equity efforts. There are several benefits contributing to this. This includes lower turnover rates due to employee loyalty, more innovation, increased productivity, and reduced burnout. Additionally, customers and job candidates are more inclined to support organizations who practice pay equity.

How to Transition to Level 2 in the Maturity Model

If you’ve identified that you’re at the first level of the pay equity maturity model, you’re probably thinking you should make advancements. Let’s discuss how to move up from level one to level two.

Start by truly understanding the value of pay equity. You need to want it. This could require a shift in pay equity ownership – someone who is dedicated and passionate about the work. You may need to establish a new role for this. This leader can advocate for pay equity investments, such as technology that allows the company to conduct internal analyses.

Consultants and legal counsel can also offer expertise to drive better pay equity decision-making. As you may or may not be aware, legislation around pay equity is shifting and employers need to be aware of their responsibilities. A consulting partner can guide you in the right direction and help build your internal capabilities.

Final Considerations

Don’t expect things to improve overnight. Pay equity isn’t a one-time thing. You also can’t jump from level one to level four and skip the rest. Be patient but dedicated to the process.

It’s important to understand that pay equity requires budgets, investments, and time. You’ll find yourself reviewing and changing things constantly. It’s unlikely you’ll be able to achieve much without an assigned pay equity team.

Once you transition to level two, it’ll be that much easier to prosper in your pay equity journey. Josh Bersin explains further, “Doubling down on change agility pays off: while just 52% of Level 1 organizations succeed in this area, an impressive 80% of Level 2 companies are effectively creating adaptability for any change.”

Remind yourself that these efforts are worth it if it means you can improve the satisfaction of your employees and create better business outcomes. If you think you’re at level two already and want to mature to level three, read our article on the Bersin Pay Equity Maturity Model: Level 2 – Sporadic Pay Equity Audit.