Think you’ve got pay equity?
Think again! Over the last decade, the focus on equitable pay has grown, making it a priority for many countries, and organizations, rightfully so. But, how do we calculate pay equity?
Pay equity analyses are often focused on comparing equity across a certain job or level (grade / broad band) in an organization.
How this works ; Take everyone at that specific job / level and look at the years of experience, the performance track record, the education level etc., and then determine if someone’s pay is lower than their peers, and correct the same.
The one question that is often missed is – Is the person at the right level, to begin with? If the person is at a lower level than they should be, then pay equity at the lower level is meaningless.
A 2021 McKinsey – Lean In Org study across 423 companies, employing 12 million people, where they surveyed more than 65,000, showed that women and people of color get promoted far slower. Women of color are the most disadvantaged. The drop in numbers from entry level, to manager, to director, to VP, and lastly to the C suite, is alarming.
Thus, when we do pay equity audits in organizations, we must look beyond the level, to ensure there is true parity.
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