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 1. Topics & Tools
 2. Workplace News & Trends
 3. Compensation & Benefits
 4. 5 Things to Know About Equal Pay



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News


5 THINGS TO KNOW ABOUT EQUAL PAY

September 17, 2024 | Kathryn Mayer
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“Equal pay for equal work” has long been a rallying cry for many, yet data finds
that there are still significant gender pay gaps.

SHRM research from earlier this year found that more than 70% of HR
professionals agree that women face discrimination in the labor market. Other
statistics show that the gender pay gap has barely narrowed over the past couple
of decades.

But a growing number of employers are taking steps to change that.

International Equal Pay Day is observed annually on Sept. 18 to recognize the
efforts being made worldwide to achieve equal pay for work of equal value. It
was created by the United Nations in 2020.

[See SHRM Toolkit: Managing Pay Equity]

Here are five things to know about the state of equal pay as well as equal pay
efforts in the workplace.

1. The gender gap is still prevalent—and worse for certain workers. Female
workers on average make 83 cents on the dollar compared to men, according to the
2024 Gender Pay Gap Report by Payscale. That number is the same as it was last
year.

However, the pay gap widens as women climb the corporate ladder: Female managers
and supervisors earn 83 cents on the dollar, female directors earn 82 cents, and
female executives earn 72 cents.

Meanwhile, it worsens for women who work remotely (79 cents on the dollar)
compared to women who work in person (89 cents on the dollar). It’s also worse
for working mothers, with the report finding that working mothers make 75 cents
for every dollar a working father earns. To contrast, women without children
experience a lesser pay gap, with childless women earning 88 cents on the dollar
compared to childless men.

[See HR Quarterly article: What’s Working for Mothers]

There has been some progress in recent years on narrowing pay gaps for women of
color. Since 2019, the uncontrolled gender pay gap has narrowed by 5 cents for
Black women, American Indian women, and Alaska Native women. Additionally, the
gap has narrowed by 4 cents for Hispanic women, Native Hawaiian women, and other
Pacific Islander women.

2. Women and men disagree on gender equity in the workplace. The majority of men
(71%) think that men and women are paid the same where they work, while only 28%
of women agree, according to a February poll from jobs site Monster. And 64% of
men feel that they are treated equally and fairly compared to their female
colleagues, while only 37% of women agree that they are treated equally and
fairly compared to their male colleagues.

3. Employers are taking steps toward pay equity. A recent report from the
compensation firm beqom found that nearly three-quarters of employers (70%) said
that they have analyzed their compensation strategies and shared existing gender
pay gap statistics with employees and/or external stakeholders.

According to beqom’s survey of 875 salary and compensation decision-makers in
the U.S. and the U.K., there are a number of problems to be addressed in the
workplace: wage discrimination (cited by 64% of respondents), promotion
disparities (57%), below-market salary ranges (54%), pay compression (53%), and
gender pay gaps (48%).

In response to some of these discoveries, most of the companies that were
surveyed have reported taking steps to close existing wage gaps and foster
transparency, according to the beqom report. Those strategies include:

 * Listing salary ranges within new job descriptions (81%).
 * Increasing salaries due to inflation and economic standard-of-living costs
   (68%).
 * Implementing a process for continuous feedback (67%).
 * Increasing pay to correct existing pay gaps and salary inconsistencies (65%).
 * Providing clear structure for bonuses and performance review processes (65%).
 * Increasing salaries based on performance (65%).

4. Pay transparency can help close the gap. Multiple studies show that salary
transparency can play a significant role in helping close the pay gap over time.
In many instances, listing pay ranges on job postings leads to more job
applications and a greater quality of applicants. There has recently been a
major call for more pay transparency in job postings, with several new laws
requiring disclosure in some parts of the U.S.

5. Pay equity audits are commonplace. Roughly 3 in 4 organizations (77%) said
that they regularly audit for pay equity, according to a 2024 SHRM survey of 777
HR professionals. The characteristics most commonly assessed in pay equity
audits include gender (80%), race or ethnicity (68%), and age (62%). Many HR
professionals and senior leaders undergo pay equity training. However, people
managers—“vital advocates” for fair pay for their employees, SHRM researchers
noted—are less likely to participate in such training.

 


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