Pay equity, the practice of paying equally for equal work, delivers outsized benefits. New research from The Josh Bersin Company, commissioned by Salary.com®, details guidelines for effectively executing pay equity projects. It covers progress, benchmarks, and execution in the advancement of pay equity. The full report, The Definitive Guide to Pay Equity, is available from Salary.com here.
The research found that 70 percent of companies consider achieving pay equity critical to their business success. But only 5 percent are getting it right. In addition to a comprehensive business-wide approach that relies on effective change management and transparent communication, effective pay equity approaches use sophisticated salary structures and a skills-based analysis of an organization’s work. Technology, like Salary.com’s CompAnalyst Pay Equity Suite, automates the analytic methods that make a comprehensive approach possible. The Josh Bersin Company research revealed that companies with a mature pay equity program are:
- 1.6 times more likely to meet or exceed financial targets
- 2.1 times more likely to attract the talent they need
- 1.7 times more likely to innovate effectively
“Achieving pay equity is a top-level imperative for organizations today, not just an HR initiative. The rapidly changing regulatory, demographic and employee engagement environment make pay equity a necessary part of every business strategy,” says Kent Plunkett, CEO of Salary.com. “We sponsor independent research like this report because getting it right is important to every employee, employer and society in the world.”
The Definitive Guide found that, of the 500+ companies surveyed and interviewed, the vast majority are unsure how to approach pay equity. These companies deal only with current pressing issues like pay transparency laws or disclosure requirements. This short-term focus on minimizing legal risk, however, can stall the long-term progress of fully realized pay equity, which can damage a company’s overall reputation and employee attraction and retention efforts.
“Pay equity is not just about pay; it’s a commitment to fairness in all aspects of rewards, job opportunities, and growth,” said Josh Bersin, CEO of The Josh Bersin Company. Our research clearly shows it is now one of the most important issues in attracting and retaining people.”
Kathi Enderes, SVP of Research and Global Analyst, further explains, “When people feel they are paid unfairly, they lose trust in their employer and question everything else in the organization. That dynamic makes it extremely difficult for a company to succeed, particularly in a tight labor market.”
The Josh Bersin Company’s Definitive Guide to Pay Equity helps create a roadmap for achieving pay equity, identifying what is most important, assessing where a company is in the journey of pay equity, and defining actionable steps on the road to pay equity excellence. It includes the following sections:
- Basic concepts and examples of pay equity – a definition of what pay equity is, how concepts like the pay gap and pay transparency relate to it, and specific examples of pay equity considerations.
- A detailed framework for pay equity, defining the elements and dimensions, and explaining what elements and practices matter most, helping you focus on the most important strategies.
- Four key findings of our pay equity research, based on our detailed analysis and in-depth interviews.
- A four-level maturity model, describing a journey to excellence in pay equity, helping you understand where you are on the road to pay equity.
- Tangible action steps to get started and advance in pay equity maturity, wherever you are in the journey.
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