pay inequality

Understanding Equal Pay & the Impact You Can Have

 

Are you able to ask candidates for their salary history in your state or city? If so, you may not be for long. If you are hiring employees in California, Connecticut (effective Jan 1, 2019), Delaware, Hawaii (effective Jan 1, 2019), Massachusetts, New Jersey, New York, Oregon, and Vermont, you cannot ask the candidate’s previous salary history during the recruitment process. All of these states and additional municipalities are just the beginning. We will continue to see many more jump on board in the months and years to come.

Women Make Only 80 Cents For Every Dollar Earned By Men

The driver behind all of this is a focus on the gender pay gap and leveling the playing field on compensation for men and women. Did you know…

  • Females make only 80 cents for every dollar earned by men?
  • Woman graduates make 82% as much as their male counterparts?
  • Women on US Corporate Board of Directors is only 12%?
  • Women owned companies average 60% lower revenues than male owned companies?

(Source: PewResearch)

The unfortunate part is the pay gap follows women even into retirement. If a woman is paid less than her male counterpart during her working years, she’ll receive less income from Social Security, pensions, and other sources when she retires than the retired men, according to an article by Fischer & Hayes.

We’ve Come A Long Way, Baby?

The gender pay gap is real. As a society, we’ve been working on this issue since 1896. In 1963, the Federal Pay Equity Act went into effect. But still, the problem is the gap isn’t closing very quickly at all for being an issue for over 100 years. Some of the reasons causing this gap include the types of majors in college and jobs we’ve pushed women to take over the years. Plus, there is still a bias–whether overt or unconscious–about women in the workplace.

A recent Harvard Global Online Research study including over 200,000 participants showed that 76% of people (both men and women) are gender biased and tend to think of men as better suited for careers and women as better suited as homemakers. This bias spills over into the workplace every day. According to the Women in the Workplace Study by Leanin.org and McKinsey & Co., for every 100 women promoted to a manager level position, 130 men were promoted. Even at the C-level, women only account for 18% of the C-level employees.

All Too Familiar Biases

This same study found that women asked for feedback as often as men, but were less likely to receive it. Plus, women do not have the same level of access to senior leaders. You’ve probably seen it or maybe even done it yourself, but when a woman tries to negotiate they are considered bossy or aggressive.

Recently, I was approached by a woman to coach her through asking her employer for a salary increase because she knew she was paid substantially less than her peers who happened to be male. We walked through the facts including her credentials and performance reviews.  When she approached her manager with the information asking for the one time increase, she was denied and told salaries are based on the income you were receiving when you were hired. And, she was also told inquires like this could result in her termination. Yes, she is now actively looking for a new position with a company that respects the skills and performance she brings to the table.

More Work Needed To Level Gender Pay Gap

If we can find a way to even the playing field and eliminate the gender pay gap, our businesses will become more collaborative, more inclusive, and more competitive. As businesses, we need to evaluate our compensation philosophies as well as take a deep look at our internal employees to ensure we haven’t fallen into the pay inequity. We also need to look at our employment practices to minimize the impact of any hidden or overt biases that would be holding women back and/or paying them less for their skills than deserved. Look for ways in your organization to help grow and develop your women into leadership roles such as through mentoring programs and even training your employees to understand how biases can affect employees and the company’s success.

As individuals, especially in HR and management roles, we can make a difference, too. We need to be reflective to realize any of our own conscious or unconscious biases that may be impacting decisions we are making with regard to hiring, promotion, and compensation. And, we may have to step outside our comfort zone to speak up when we see inequality taking place.

 

Editorial Note: The content of this blog originally appeared in the August, 2018 edition of ABR Employment Services enewsletter, HR Insights. It has been edited for SEO by Kinsa Group and originally written by Robin Throckmorton of Strategic Human Resources Inc.

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