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Pay Equity Analysis Becoming Standard Practice at Organizations

Organizations are making strides in analyzing and ultimately remediating their pay inequities.

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This was a key finding in WorldatWork’s “Pay Equity Practices and Priorities Survey,” which assessed the current state of pay equity-related work being executed in organizations today. Of the 352 WorldatWork members that responded, 79% said gender pay gap analysis is becoming standard practice at their organization, and 71% said broad equity analysis is becoming standard practice.

Additionally, 55% said remediation strategy execution and remediation option evaluation (52%) isn’t far behind. Only 9% of organizations said gender pay gap analysis is not on their radar.

“This survey and the “Pay Equity Practices Survey of C-Suite and Reward Leaders” conducted earlier this year confirm what has become increasingly apparent in the media — pay equity is the single fastest growing topic the HR profession has seen in decades,” said Scott Cawood, president & CEO, WorldatWork. “It’s not just about salary, though. For example, while the survey reveals positive movement towards pay equity remediation, benefits programs are receiving the least amount of attention when looking for potential biases that may contribute to pay disparities. Understanding of how benefits programming can skew to attract or serve one group over another is beginning to emerge.” 

Key Findings:

  • Recruitment and hiring practices receiving a lot of pay equity attention. Leading the pack of practices, addressed at one point between 2018-2020 (anticipated) or receiving regular attention in relation to pay equity work are recruitment practices (88%); individual pay determination decisions (83%); hiring practices (83%); diversity and inclusion programs (82%); and selection practices (81%).
  • Broad view of potential areas of bias or factors in pay disparities is common. To identify or reduce potential biases, organizations are looking on an ongoing basis at market data (73%); performance management practices (69%); health care, well-being and/or retirement benefits (58%); paid time off and flexibility benefits (55%); and dependent/elder care benefits (35%).

While many are looking at performance management practices in context of pay equity, one-third of organizations are not (32%).

“This is intriguing because those programs tend to be subjective,” Cawood said. “How do you keep bias from creeping in? In the future, performance management programs will have to adhere to new frameworks in order to be bias-free. We know, anecdotally, that organizations that do look at performance management in the pay equity context are experimenting with removing practices like merit pay to prevent bias or the perception of bias.” 

About the Author

Brett Christie is a staff writer at WorldatWork


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