The Josh Bersin Pay Equity Framework

The Josh Bersin Company has recently released a report in collaboration with Salary.com titled The Definitive Guide to Pay Equity. This white paper uses a study of 448 companies and their 24 management and HR practices to help give you a deep knowledge of the concept of pay equity. From understanding the pay equity framework to finding out about the pay equity maturity model, we have you covered.

In this article, we will discuss the section titled “The Pay Equity Framework.” We will begin by explaining what the pay equity framework is and how different elements and dimensions correspond with it. As well as this, we will outline what the 12 essential pay equity practices are. Without further ado, let’s get started.

What is the Pay Equity Framework?

When approaching our pay equity framework, it is vital to understand that pay equity is a complex concept to implement in an organization. It goes well beyond a compensation project and requires continuous commitment and effort from management and leaders. Failing to keep up with pay equity practices can quickly land you in hot water, both legally speaking and with your employees.

Our pay equity framework delivers a map for a comprehensive strategy and approach. This strategy and approach will help lead you to accomplish the goal of equal pay for equal work in your organization. As you can see below, our pay equity framework outlines five major elements and fifteen dimensions for you to consider.

Breaking Down the Five Major Elements

Each element of the pay equity framework is unique and contains areas that should be seen with great importance by your organization. Learning what each of these elements consists of and what this means is vital to understanding the pay equity framework. Let’s break down the five major elements of the pay equity framework:

• Philosophy and Strategy

- Defining the Business and Rewards Strategy

You must address questions relating to your organization’s mission, vision, and purpose when defining the business and rewards strategy. As well as this, you need to also address questions about the people-related strategies and how the business and rewards strategy supports them and pay equity.

- Convening a Cross-Functional Team

A cross-functional team needs to be made up of employees from various departments and groups within your organization to work on pay equity. This team needs to bring expertise across various areas and be able to budget for adjustments, focus on addressing decision-making biases, and be proactive and willing to help drive change within an organization.

- Soliciting C-Level Sponsorship

Strong support and endorsement from the C-suite enable comprehensive actions to be made regarding pay equity issues. From the research conducted, this can be viewed as a make-or-break point to differentiate outcomes.

• Jobs and Skills

- Conducting a full job evaluation

Jobs in your organization require a full evaluation to assess if they are comparable or equal. This is a critical moment as it allows your organization to make pay equity decisions based on your research.

- Performing a Comprehensive Skills Assessment

By reviewing the skills requirements of different jobs, you can break down work into smaller components. This helps you determine how pay should be allocated for skills acquisition or when employees reskill through new assignments.

- Identifying Comparator Groups

Your organization will need to decide which groups of jobs, projects, or work assignments are comparable for use during a pay equity audit. These comparator groups, or SSGs, are typically broader than job codes which means they span more than job functions.

• Analytics and Technology

- Analyzing Internal and External Equity

Your organization needs to define a process for reviewing both internal and external equity. It can be challenging to do both at the same time, which is where Salary.com comes in as our technology can help you do so.

- Defining Demographic Categories

You need to determine which demographics you will use for pay equity audits. For example, it could be gender, ethnicity, nationality, or any other personal attributes.

- Conducting Ongoing Statistical Analysis

By performing an ongoing statistical analysis you can isolate issues and use technology to scale the process. Nowadays, this technology is specialized to cater to your organization’s needs.

• Talent Processes

- Reviewing Processes Related to Recruitment and Mobility

Hiring and internal mobility can sometimes introduce pay equity issues, so it is important to identify whether it does or not for your organization. You can implement practices such as removing salary history questions or communicating transparently the salary ranges for roles to help avoid inequities.

- Identifying Issues in Skills and Career Growth

When analyzing issues and skill growth, your organization must look for any potential bias. Clearly define training opportunities and make sure that what you offer is inclusive of all.

- Reviewing Performance and Pay

Your organization needs to identify and mitigate any biases and inequities in pay processes based on performance or promotions. You can use objectives and key results, as well as “bias interrupters” to help address the root cause of pay inequalities in your organization.

• Change and Communication

- Reviewing Organizational Readiness

Understanding the pay equity readiness in your organization can help you identify and address opportunities and gaps among your employees. Education on pay equity will lead to a greater understanding of pay equity in your organization and help you identify barriers to readiness that exist.

- Focusing on Transparent Communication

There needs to be clear and transparent communication in your organization when it comes to dealing with the strategy, plan, opportunities, and pay transparency that relates to pay equity. Some companies struggle to have business-led communication, but those who do it successfully can benefit the most.

- Prioritizing Continuous Improvement

Your organization must be proactive and strive for continuous improvement. This could be in areas such as acting on issues, reviewing the causes of inequities, or anything else to do with sustainable pay equity practices.

The 12 Essential Pay Equity Practices

To finish, we will look at the twelve essential practices of pay equity that have the biggest impact on your organization. The impact they have will be disproportionate on outcomes including financial performance, customer satisfaction, innovation, and people metrics. Take some time to review the twelve essential practices below.

Check Out ‘The Definitive Guide to Pay Equity’

The Definitive Guide to Pay Equity will equip you with all the knowledge you need to have a deep understanding of pay equity. Through what is outlined, you will be able to create a plan for achieving pay equity, identify what’s most important, assess your organization’s current pay equity situation, and define the actionable steps toward achieving excellence in pay equity.

Read more from this series:

• Definitive Guide to Pay Equity
• Pay Equity Framework
• Pay Equity Maturity Model
• 5 Key Findings of the Definitive Guide to Pay Equity