How Employers Can Lead the Way on Equal Pay
Recently, the UN launched the “Platform for Champions” campaign, whereby unions, governments, advocates, and the private sector will work together and call for increased support for equal pay by decision and policy makers. Actress Patricia Arquette, soccer star Abby Wambach, and Anannya Bhattacharjee, President of the Garment and Allied Workers Union, helped kick off the event, reminding us that almost every woman, whether a wealthy Hollywood actress or a garment worker in Bangladesh, feels the impact of the gender wage gap.
As the campaign recognized, businesses play a vital role in efforts to advance equal pay, both abroad and here in the U.S. The past year has seen a tremendous increase in the number of companies worldwide speaking up about the impact of the gender wage gap their support for equal pay—globally and here at home.
This Equal Pay Day, we hope our report encourages more companies to commit to taking tangible, measurable steps to close the gender wage gap in their workforces – and to share what they’re doing both with their employees and with the public, so others can learn from their work.
In our report, Employer Leadership to Advance Equal Pay: Examples of Promising Practices, we’ve outlined steps some businesses, large and small, have already taken to begin closing their internal gender wage gaps. These steps include conducting equal pay audits with transparent results and methodology, increasing transparency about pay, banning the use of salary history and negotiation to set compensation, and moving towards clearer compensation metrics for staff that minimize the role of bias and discretion.
For example, a growing number of employers, including Delta, Expedia, and Microsoft, are conducting equal pay audits and addressing internal wage gaps when they find them. Buffer, a tech start-up, conducted a pay data analysis in 2016 which revealed that men’s average salaries were $98,705, compared to women’s average salaries of $89,205. Buffer announced steps to address its wage gap, including examining its process for determining how employees are placed at an “experience” level, which determines compensation, and hiring more women to address the gender imbalance in its workforce.
Some employers have moved towards more transparent pay practices, because a culture of secrecy around pay can give cover to discrimination, while openness around compensation can increase the likelihood that employees believe they are paid fairly. Companies like Buffer have made salaries transparent to the public as well as employees, while Jet.com, SumAll, and Whole Foods have made the salaries of all staff available to their employees. At GoDaddy, employees can compare their salaries to coworkers in the same position, and each pay statement indicates the salary level and range for their position.
Other employers have taken steps to standardize compensation-setting and eliminate salary negotiation. Setting compensation based on negotiation, rather than objective standards, can exacerbate gender and racial wage gaps. As a result, employers like Jet.com and Mission Produce are moving towards more standardized processes for setting compensation. Reddit created a set compensation structure and eliminated negotiation when setting salary, and companies like Accenture are moving towards set compensation structures that pay based on the position—not based on salary history.
To see more examples of what employers can do, look at our report—in it, we’ve outlined more than 50 different actions that public and private employers have taken to close the wage gap.
This Equal Pay Day, ask yourself what steps your employer, and the businesses you support, are doing to advance equal pay for their employees. Know an employer who might find our resources helpful? Share it with them, and let us know!