On April 5, U.K. companies with 250 employees or more were required by law to reveal their pay data. The goal: Narrow the gender wage gap.
In response, many people across the world have shared their personal experiences, data, and opinions regarding gender pay differences. Another Inc.com columnist, Heather WIlde, wrote about being paid 60 percent less than her male colleagues at the same level. The 2016 U.S. Census revealed it takes a woman one year, three months, and 10 days to earn what her male pear earns in one year. I personally quit a job once over a $5,000 gender wage gap.
Now that we're really talking about this, let's solve the gender wage gap once and for all. I believe achieving equal pay for equal work is possible. It takes time and effort and it isn't easy, yet it is a solvable problem. Creating true equal pay requires two things:
- Commitment to a system that evaluates each individual relative to their peers.
- Fluidness within the system created.
Through decades of trial and error, I believe I've found a system that works. It's achievable by teams both big and small. It's likely to raise a few eyebrows, and that's OK. Sometimes, doing the right thing is hard.
Here's my four-step process:
1. Define work expectations.
Paying equal for equal work doesn't start by looking at everyone's salary and making all salaries the same. It starts with defining the work. You wouldn't pay a junior employee and a CEO the same, regardless of which role was held by a woman and which by a man.
Create a list of skills needed for each job. Craft beginner, intermediate, and advanced skill level expectations for each skill. If you have software engineers in your organization, a simplified skills set might look like the following:
Demonstrates awareness / interest in modern engineering best practices
Writes quality code
Is open to feedback and gives effective feedback
Practices modern engineering best practices
Can learn new technologies quickly
Understands the benefits and pitfalls of various software development approaches
Teaches/mentors fellow developers how to program
2. Create salary bands and a career ladder.
After your skill sets are fleshed out, create a career ladder with salary bands. This creates clear and equal promotion path for each individual. That engineering team's career ladder might be:
- Junior Developer
- Midlevel Developer
- Senior Developer
- Lead Developer
- Engineering Manager
- Director, Engineering
- VP, Engineering
Every rung on the career ladder gets a salary band. Ideally, salary bands are narrow. A $10,000-$25,000 difference should separate the bottom from the top of each band.
Every employee inside a rung gets paid a salary inside that salary band. If someone is working at a senior developer level, they get paid within the senior developer salary band.
3. Allow promotions at any time.
Enabling promotions at any time ties the skills, career ladder, and salary bands together. Whenever a manager, employee, or anyone else in the company believes an individual has achieved the required levels, the individual is considered for promotion--whether that takes six months or six years.
For larger organizations with more established processes and procedures, this is challenging. For smaller organizations, not so much. Get as close to this as possible.
4. Give bump-up pay.
For folks who aren't ready for a promotion but somehow fall behind market pay, proactively offer bump-up raises inside the band. You can also adjust the band's salary levels.
For example, if you're offering new employees $5,000 more to join your team than those currently employed at that level, any existing employees that are paid less should get a $5,000 off-cycle bump in pay. This should happen proactively, without employees having to ask.
How to ensure fairness inside each band.
There will be some wiggle room inside each salary band. The alternative--setting precise salaries for each and every minor movement along the ladder--is quite demotivating, and will probably result in star performers feeling undervalued.
So, there needs to be some wiggle room inside bands, but not too much. As the manager, you need to be held accountable for fairness inside each band. You should regularly analyze salary inside each band by gender, and every time you identify any biases, you can address them.
The reward for our hard work will be a fair, equal playing field that enables each individual to work to their potential--and be rewarded as soon as they're ready.
Disagree? Agree? What have you seen work? What struggles have you encountered? Please share your thoughts below. The more open conversation we have around equal pay, the more we'll all benefit.