How Can Organizations Ensure Ongoing Pay Equity?

Pay equity is not a one-and-done process. It is an ongoing commitment with no end. As new recruiters join your team, employees make shifts, and others leave, your pay equity requires revisiting. It’s hard work, but it is the ultimate way of demonstrating that you respect an employee and their value to your organization, regardless of their gender or race.

When you leave addressing pay equity matters to the last minute, it can become overwhelming. It could seem too costly or time-consuming for you to even bother with. However, employers must be compliant with state and federal laws so ignoring it won’t cut it. Perhaps more importantly, “If you want to win the war for talent, fair pay may be one of your biggest techniques,” says Josh Bersin.

Let’s discuss five ways you can ensure ongoing pay equity in your workplace.

1. Conducting Pay Equity Audits (PEA)

Pay equity audits are conducted to compare employees in your organization who perform comparable jobs. By accounting for differentials such as work experience and credentials and analyzing tenure, job classification, and demographic information, you can identify gaps in your pay practices.

Remember that your employees’ job descriptions will need to change as they grow in your company. You will hire new talent. Market trends will alter. Have your base data in one place and review it as you make changes in your organization.

Without software, you might not be doing as thorough a job as you think. HBR explains further, “Many companies believe they are conducting PEAs, but most are falling short both in the rigor of their analyses and in their ability to clean and consolidate their data sufficiently to ensure accurate results.” Tools like Salary.com’s CompAnalyst Pay Equity Suite can ensure a robust analysis that serves the best interest of your company.

2. Utilizing Performance Reviews

Performance reviews are a great time to discuss your pay practices. These should be conducted regularly to ensure your employees are on the right track. Be transparent about pay grades and what progress each worker is making. You will build trust and demonstrate your commitment to pay equity.

Consider who is being rewarded for their performance and why. It’s your job to ensure that team members are rewarded equitably, but also that everyone has equal opportunities to meet their goals and grow. All of this should be noted in data records ready for evaluation on your next pay equity audit.

3. Reviewing Job Descriptions

Job descriptions should reflect the responsibilities of each role in your organization. This allows you to group employees based on comparable job functions and is a crucial step in pay equity. If job descriptions aren’t accurate, the way you’re evaluating pay is not accurate.

Make it a habit to revisit job descriptions when conducting performance reviews. Go straight to the source – ask your employees if they’ve taken on any new responsibilities. Sometimes someone is hired as a sales representative but then takes on marketing duties, too. Job roles transform and shift all the time. It’s vital to monitor these changes and adjust your job description records accordingly. This ensures that you’ll know when someone has moved pay grades and requires more compensation.

4. Updating Internal Data On The Go

With each of these steps, you’re gathering data. It’s no use storing this information in your head or on some slips of paper. You need to store your internal data in a way that can be updated on the go.

Assign different aspects of your pay equity process to a team. Ensure that everyone is trained and on the same page about the process. Each team member should be responsible for documenting job description updates, performance reviews, and employee feedback. Someone should also be responsible for scanning for pay equity gaps.

If you can update your internal data on the go, you save yourself from having an overwhelming amount of pay equity data to sift through in your annual review. Spreadsheets are a good start, particularly if you’re a small company. As mentioned previously, pay equity tools can really assist you here.

5. Keeping Up To Date

The final tip is to know what’s happening at all times. Follow industry trends and shifts. Ask for and listen to your employee feedback. Value what they have to say. It’s easy to brush off a workplace decision without realizing how it impacts the opposite sex or someone with a different cultural background. If you want to retain and attract top talent, your company will have to evolve and grow to meet these expectations.

There are also new laws around pay equity emerging. Remember that it isn’t just federal laws you should be familiar with. Different states across America are enforcing their own regulations, some with greater protection than what federal law covers. Seek expert guidance regarding any changes made in your state.

The Pay Equity Loop

Pay equity is an ongoing process. If you want to achieve it in your workplace, be prepared to revisit, update, and repeat. As regulations evolve around this topic, you might consider prioritizing it in your compensation strategy. When you can transparently discuss pay, you open the door to more talent and do your part in creating a fairer workforce.