HR Management & Compliance

Are You Accidentally Creating a Gender Pay Gap?

While most employers are likely actively taking steps to minimize or eliminate any form of gender-based pay discrepancies, these do still exist in the workplace for a variety of reasons. Some of these reasons may be difficult to change, such as the average amount of pay for entire industries that typically hire one gender more often than another. But there are a lot of ways that employers can contribute to gender pay discrepancies, often without meaning to do so. These are topics we can tackle.

Source: Olivier Le Moal / iStock / Getty

Here are some ways employers may be inadvertently contributing to the gender pay gap:

  • Basing starting pay on pay from previous employment rather than basing it on the job at hand. Basing pay on what an applicant was previously paid runs the risk of simply perpetuating previously low pay for disadvantaged groups. It may seem fair on the surface to offer X% above previous pay, but if the individual was previously underpaid, this method will only serve to continue an unfair situation. Instead, set pay rates for a given role and experience level, and set them before any candidates are even considered. Use a range to give yourself enough internal flexibility to account for differences in skill sets for the eventual new hire, but set it independently of the applicant’s previous pay—and don’t even ask what that was.
  • Not training supervisors and others in control of promotions to reduce bias and assumptions in employment decisions. If managers allow bias—even unconscious bias—to creep into promotion decisions, it can mean that individuals may be unfairly skipped over for opportunities. For example, if a supervisor simply assumes that a mother of young children would be uninterested in a promotion that would require travel—but does not make that same assumption for fathers—that could mean the organization starts promoting or giving better assignments along gender lines. This is a classic example of a situation where the employer may even feel as though they had the employee’s best interests at heart, but it ended up having a negative impact over time anyway.
  • Not assessing how bonuses are distributed. In many cases, men are more likely to receive bonuses or their bonus totals may be higher than those for women[i]. This obviously may be inadvertent, as bonuses may not be assessed as a group. But it’s certainly a place where gender pay differences can add up. This issue can be exacerbated if salaries differ to begin with—even by a little bit—and bonuses or raises are a percentage of base pay. It makes any existing gap even more difficult to overcome over time.
  • Not giving any paid time off for familial duties. When organizations opt to not give paid time off to handle family obligations, employees in these situations may face a tough or impossible choice: either stay on the career track and not give the family the care they need—which could have extreme negative consequences—or give up the career altogether (temporarily or permanently) in order to meet family needs. Family needs may be something like caring for a new child, or caring for an ill family member. When this situation happens, it disproportionately results in women leaving the workforce, as women are more likely to become caregivers. This means more men are advancing in the workplace while women are not—perpetuating the gender pay gap even without intentionally paying differently. This can be addressed through more comprehensive paid leave programs, which can be then utilized by both men and women and can make these tough situations a little easier. This type of program can increase the likelihood that an employee who must take on caregiving duties can return to work—and not have to make that agonizing choice to leave in the first place.

What has your organization done to ensure that pay discrepancies are not gender-related? Or what corrective actions have you found to be helpful when inadvertent gender pay gaps exist?

[i] https://www.adp.com/-/media/RI/pdf/GenderEquality_Infographic.ashx