This Equal Pay Day marks another reminder of the persistent wage gap for women. On average, women working full-time, year-round make only 84 cents for every dollar paid to men. Women continue to be underpaid and undervalued and overrepresented in the lowest paid jobs.

Employers must take action to ensure equal pay by:

• Establishing clear pay policies: This includes creating a compensation philosophy tied to organizational values, explaining the factors considered in setting pay, and establishing clear pay practices. An objective pay policy can serve as a powerful tool to strengthen accountability, support alignment and consistency, and reduce arbitrary and biased decisions.
• Increasing transparency: Including salary ranges in job postings is not only a best practice, it is required by law in many jurisdictions. Employers should also promote transparency by providing the pay scale for the workforce along with an explanation of how pay is set within ranges, potential opportunities for bonuses, cost-of-living increases, pay increases associated with promotions, etc.
• Rethinking “merit” pay: While pay for performance policies can be well-intended, these practices too often perpetuate bias and can have unintended consequences on morale. Employers should consider alternative methods to reward strong performance.
• Setting clear locality pay policies: Employers with operations in multiple locations have long grappled with concerns about how to handle compensation to account for variations in the cost of labor and the cost of living. With increasing numbers of employees working remotely, many employers face new and complicated questions. When employers offer locality pay, these policies and practices should be formalized and communicated to the workforce.
• Paying interns: Unpaid internships can operate as a barrier to entry, especially for low-income students, who are disproportionately people of color. Paid internships provide important opportunities for those entering the job market to realize their potential and for employers to diversify their workplaces. 
• Conducting regular pay equity assessments: Employers should annually review pay data to identify outliers and address any unexplained disparities, including unexplained gaps relating to gender, race, and ethnicity.

Closing the pay gap is not just the right thing to do. It’s good for business. Fair pay can help to attract and retain top talent, boost morale, and improve the bottom line.

Working IDEAL provides trusted and innovative advice on inclusive workplaces, diverse talent, and fair pay. Contact us to learn more about the services we offer.