HR Strange But True

CEO Combats Gender Pay Gap by Not Negotiating About Salaries

They say when one door closes, another door opens. A woman executive who had recently lost a gender discrimination lawsuit against her employer became a CEO who devised a unique way of preventing the gender pay gap at the company she now runs.

Ellen Pao, interim CEO of Reddit, lost a highly publicized sex discrimination lawsuit against her then employer and had both her personal and work life brought up at the trial. But as she told The Wall Street Journal (WSJ), the loss inspired her to “change people’s perspectives” about employment decisions being made on the basis of gender.

Pao had filed suit for what happened to her as an employee of a venture capital firm. She hopes her court fight, even though she lost, has made women more comfortable in pointing out disparities in compensation.

Pao also told the WSJ that she hopes executives are now paying attention to the topic of gender discrimination in compensation, and “saying, ‘How do we make sure this isn’t happening in our environment, or how do I make sure that I’m not doing it?’”

As CEO of Reddit, Pao has become more aware of, and involved with, issues of gender inequality in human resources issues such as compensation, even bringing in a consultant from the Level Playing Field Institute. She learned that men negotiate harder than women, who are often penalized for doing the same thing.

Her solution to the gender gap at Reddit? She decided that Reddit won’t negotiate salaries with candidates, but will offer them only the salary that was determined as fair for that position. She told the WSJ, “We aren’t going to reward people who are better negotiators with more compensation.”

According to finance.yahoo.com, Pao’s policy also prevents inadvertent discrimination against women who may be poor negotiators or hesitant to negotiate.

It’s ironic that by losing a gender discrimination lawsuit, Pao has become a champion of gender pay equality.