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Breaking Down Barriers to Pay Equity

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Breaking Down Barriers to Pay Equality 1 Introduction The statistics on the difference between pay for men and women are striking: The Census Bureau found the gender wage gap in 2016 was 20 percent. This gap is a problem in every occupation, and women earn less than men at every educational level. According to the National Committee on Pay Equity, the gap is even more pronounced for women of color and for older women. A renewed focus on the wage gap has prompted organizations to examine their models of compensation, including how pay breaks down across different demographic lines. While looking at pay equity gaps, an organization analyzes a host of data on employee demographics, performance and compensation to uncover the key factors that drive pay. This helps to differentiate legitimate factors for pay from illegitimate ones within the organization. An analysis of this type looks at a rich cross-sectional data set that has the power to find long-term solutions to the pay equity issues within an organization. When leaders discover pay gaps in their organization, they often focus on short-term remediation techniques that provide the most immediate impact. They may examine a certain business group or look at gaps across a certain position, then focus on the cost of equalizing pay in that narrow context. Unfortunately, they often find the need to revisit the issue a year or two later because their steps have failed to solve the systemic issues causing inequality across the organization. Organizational leaders must instead commit to removing barriers to pay equity, rather than simply fixing inequity when they identify it. They must adopt an analytical perspective and ask the right questions to solve this issue in the long term as well as the short term. They must use sophisticated analytics techniques to dig into the people analytics at their organizations to determine where the choke points are when it comes to pay inequity and how to correct them. Finally, CEOs and CHROs must work together to build on the insights from pay equity studies to improve their broader Diversity & Inclusion (D&I) approach. This white paper will look at three steps to take to break down systemic barriers and move toward pay equality over the long term. While looking at pay equity gaps, an organization analyzes a host of data on employee demographics, performance and compensation to uncover the key factors that drive pay.

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