In yesterday's Advisor, attorney Leslie Silverman discussed HR responses to the recently-passed Lilly Ledbetter Fair Pay Act. Today, we'll cover her suggestions for insuring pay equity, and we'll take a look at a unique checklist-based audit system.

Silverman noted that the law does not require “equality,” but it does require “equity.” Equity can be encouraged and audited much more effectively if a uniform process is followed.

Silverman, a former Commissioner of the Equal Employment Opportunity Commission, and now a partner with the labor law firm Proskauer Rose LLP, offered her suggestions to employers at SHRM's recent Employment Law & Legislative Conference in Washington, DC.

The uniform process she advises includes the following steps:

  • Review document retention policies to ensure that all records relating to compensation decisions will be kept long enough.
  • Ensure that your workplace has systems in place for setting and reviewing all pay decisions.
  • Provide written guidance to managers on how to set employee salaries at hire, and to grant promotional and merit increases.
  • Ensure that all pay decisions are well-documented. Supervisors should document the rationale for why certain employees receive higher or lower pay, benefits, or evaluations.
  • Have a system in place to review compensation decisions for consistency and compliance with your compensation policies.
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  • Consider having a committee review all compensation decisions. (She admitted that this is cumbersome, “But,” she said, “people act differently in groups, and it reduces bias.”)
  • When setting new-hire compensation, capture and document all relevant factors:
    • Initial salary demands and negotiations;
    • Education and relevant work experience;
    • Salaries of similarly situated employees; and
    • Relevant economic labor market at time of hire.
  • Conduct regular, periodic performance appraisals.
  • Train managers, supervisors, and executives on how to conduct performance appraisals.
  • Require that each evaluator provide a narrative explanation of why specific ratings where given.
  • Ensure that merit pay increases are linked to a manager's evaluation of an employee's performance.

That's all well and good, you might say, but where's the time and the staff? It's never simple running HR—new regs on one hand, old (and potentially illegal) behaviors on the other. 

Fortunately, there's a simple tool for making sure you are in compliance with Lilly Ledbetter and all the other laws and regulations in HR land—the HR audit. It's the only sure-fire way to identify problems early, and correct them before they turn into expensive lawsuits.

Experts recommend an annual audit, but after digesting Leslie Silverman's suggestions, perhaps next week would be better? In either case, to do a good audit, you need audit checklists, and there's good news: BLR's editors have already written them—for all of the most challenging areas of HR.

Don't "just do it" ... do it right. HR Audit Checklists assures that you know how. Try the program at no cost or risk. Find out more.

Why Checklists?

Why are checklists so great? Because they're completely impersonal, and they force you to jump through all the necessary hoops, one by one. They also assure consistency in how operations are conducted. And that's vital in HR, where it's all too easy to land in court if you discriminate in how you treat one employee over another.

The program our editors recommend is BLR's HR Audit Checklists.

Just as an example of how it compels thoroughness, it contains not one but seven checklists relating to recordkeeping and digital information management. One lists 34 types of data and also covers confidentiality, emergency planning, efficiency, compliance with laws, and safety. You'd likely never think of all those possible trouble areas without a checklist, but with it, just scan down the list and you instantly see where you might get tripped up.

In fact, housed in the HR Audit Checklists binder are dozens of extensive lists organized into reproducible packets, for easy distribution to line managers and supervisors. There's a separate packet for each of the following areas:

  • HR Administration (including communications, handbook content, and recordkeeping)
  • Health and Safety (including OSHA responsibilities)
  • Benefits and Leave (including health cost containment, COBRA, FMLA, workers' compensation, and several areas of leave)
  • Compensation (payroll and the Fair Labor Standards Act)
  • Staffing and Training (incorporating Equal Employment Opportunity in recruiting and hiring, including immigration issues)
  • Performance and Termination (appraisals, discipline, and termination)

HR Audit Checklists is available for a no-cost, no-risk evaluation in your office for up to 30 days. Visit here and we'll be happy to arrange it.

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