Why Your Company Benefits From Publishing Pay Data (Even If You Don’t Have To)
Updated: Dec 14, 2020
Welcome to my weekly Q&A roundup. (Scroll down to find the Q&A.)
If this is your first time here, welcome. I spend a fair amount of time speaking at events and conferences. At the end of my presentations, I leave space for audience members to ask questions—tough questions, brave questions, you name it.
The level of candor and curiosity always inspires me, and I want to share that sentiment with you. So each week, I pick one question that I believe others would find most instructive and publish my response to it here.
The purpose of this weekly tradition is transparency and inclusivity.
• Transparency: a behind-the-scenes look at my day-to-day.
• Inclusivity: bringing others along in the journey.
The Benefits Of Pay Transparency
There have been many twists and turns on our path to intersectional gender equity since the start of the year. We saw the mass migration to remote work, widespread closures of schools exacerbating the burden of the second shift, renewed calls of racial justice—to name a few examples.
And while I’m not in the business of reading tea leaves, I believe data will be fueling “the Great Reset” (or whichever term you choose to call the New Normal).
How we collect data. Why we collect data. Where we collect data.
Data-driven decision making will become the norm. This week, let’s explore one use-case of data collection as it pertains to pay equity.
Should my company still collect and publish employee pay data even if we aren’t required to by state law?
Compliance issues aside, collecting, organizing, and publishing data that pertains to workplace equity is becoming mission-critical for businesses nationwide. So yes, your company should still collect and publish employee pay data even if you aren’t required to by state law.
In late July, we talked about what Colorado’s Equal Pay for Equal Work Act means for employers. And while Colorado’s equal pay law is one of the most comprehensive in the US, employers in other states would be wise to voluntarily follow Colorado’s lead.
If the economic upside of intersectional gender equity isn’t enough to convince you to prioritize pay equity, consider the following three points:
1. Job seekers want to see diversity and pay equity data.
Comparably, the developer of an online platform offering information on company culture and compensation, reported that demand for data on underrepresented employee pay doubled in the past four months.
And ZipRecruiter’s July data found that the term “diversity” soared by 222% YoY in searches among job seekers. It shouldn’t surprise us that people want to work for companies that value people equitably. In fact, 53% of HR professionals say that recruiting the right talent drives their goal of achieving pay equity.
2. Investors want to see (better) diversity and pay equity data.
Investors—both individual and institutional—want to use their portfolios to catalyze concrete action toward intersectional gender equity. But widespread data deficiencies make equitable investing (aka ESG investing) difficult. This Financial Times article describes how one asset management organization had to Google the names of board members, one-by-one, of 150 companies to gather diversity data.
In early July, the New York City pension fund even called on organizations to improve their diversity reporting. That, coupled with the rise of divestment lists and custom ESG portfolios, should prompt companies to take a data-driven stand for intersectional gender equity.
3. Pay equity laws are gaining traction in legislatures around the country.
There are now 37 states with “significant” pay equity laws in place, 11 states with “some” laws in place, and two states with no established laws. While the scope, execution, and enforcement of these laws vary, together they are building momentum for the pay equity movement. In the past three years alone, 35 states have passed or proposed legislation to drive pay equity.
Paying people equitably is a function of valuing people equitably. In a perfect world, regulatory compliance wouldn’t be the catalyst for organizations to pay their employees equitably. Ultimately, we must create workplace cultures that value the contributions of all employees.
And that value must be expressed in all aspects of the employee experience, from how people are treated during the workday to how they are compensated at the end of the day.
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