WorldatWork Joins the National Debate on Pay Equity -- How About You?

On March 7, 2017, WorldatWork published a position statement on pay equity. After 12 formative years in Catholic school I am not fond of people talking for me, but WorldatWork's overall position addresses a reality that our profession faces. It " . . . acknowledges the leadership role that WorldatWork and its members must take on this critical issue." And it doesn't shirk on the details.

In other words, the position statement has been created to influence the way we act professionally and to " . . . outline the role that compensation and rewards professionals have in reducing and eliminating pay equities in the U.S. workforce." I urge you all to take a close look.

Here are a few of the highlights until you can sit down and carefully read the statement:

"WorldatWork fully expects [pay equity] to continue to be a key business priority." I think most Compensation Cafe readers would agree.

" . . . rewards and compensation practitioners and the organizations they serve also have a responsibility to reduce or eliminate pay inequities through innovative private-sector workplace programs and policies."

"WorldatWork supports pay transparency . . . [and] opposes policies that prohibit employers from requesting a job candidate's total rewards history during their consideration and interview process."

Also, "WorldatWork endorses regular, organization-wide pay analyses to aid in reducing any unconscious biases or structural barriers in hiring practices, performance reviews, promotional guidelines and leadership opportunities that may contribute to pay inequities."

There's a lot more in there, so be sure to read the statement a few times. After that, decide for yourself where you stand on the issues and solutions being promoted. Finally, discuss it with your team AND your boss(es). The statement calls out a number of areas where all of us can and should up our game. For instance, "WorldatWork strongly believes that equal work must be measurable." How many of us actually deliver valid insightful measurement protocols, yet we're clearly going to need to accomplish this as data expectations become more sophisticated in the digital world.

I have looked forward to the day when our profession would finally share a conversation about Compensation's future. I'm marking March 7, 2017 on my calendar as the day the conversation began in earnest.

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Her firm, re:Think Consulting, provides market pay information and designs base salary structures, incentive plans, career paths and their implementation plans. Earlier, she was a Principal at Willis Towers Watson. Margaret is a Board member of the Bay Area Compensation Association (BACA). She coauthored the popular eBook, Everything You Do (in Compensation) Is Communications, a toolkit that all practitioners can find at https://gumroad.com/l/everythingiscommunication.

Comments

[K Gremillion]

I have to disagree with one of the positions expressed in the World at Work full statement, as follows: Compensation should be tied to the specific job and market forces that dictate the rate of pay for that job. In order to make a compelling offer of employment to candidates, WorldatWork opposes policies that prohibit employers from requesting a job candidate's total rewards history during their consideration and interview process.

While I 100% agree with the first sentence, the opposition expressed to policies prohibiting salary history contradicts this intent. As a practitioner I have many times provided market data for a role (i.e. 90K-100K), but a hiring manager knows based on salary feedback history from the candidate they would accept less (let's say 85K) - so do they offer the market rate anyway (90K)? Nope, they go with 85K and generate more pay inequity. Had that same manager not had the historical information from that candidate, that candidate would have likely been offered 90K instead.

[E. James (Jim) Brennan]

Great topic, Margaret! A number of us regular posters here seem to agree with K. Gremillion, as any search for the "pay history" or "past pay" topic will show. When one side to an economic transaction has information denied to the other, the playing field is not level and the market is neither "free" nor "open." Refusing to pay the established job value regardless of prior pay is a classic form of systemic discrimination, perpetuated by blind imitation.

It is also reckless management, creating disruptive internal inequities. Modifying offers to competent candidates due to prior salary also makes the new employer's starting pay decision contingent on the wisdom of the prior firm. If they overpaid, you overpay. If they underpaid, you underpay. This is conscious bias and a structural barrier to equity. Hardly smart.

Using prior pay history as a cudgel might save a little money in the short run, but it creates serious issues that always cost a lot more to solve eventually. Fair pay delivered grudgingly via adjustment later hurts morale, when you could have won dedication by playing fair up front.

[Annika Larson]

On first read, I assumed W@W's statement was regarding legislative policies prohibiting requesting/demanding pay history. It's unclear they even mean employer policy.

I hope employers continue to evolve to ban this process with help from HR, D&I, and Comp teams.

From personal experience, employers who do required salary history usually are not up front in proposed pay ranges. Early in my career I watched interesting candidates be passed up early in the process for sharing required pay history. This was for both showing too high or too low of pay compared to the role's range. They were not looped into what the role paid or why they were dropped.

Mutually sharing anticipated target ranges should be enough to work with. Salary is only one peice of a total reward value for candidates. Responsible interview practices will assess if candidate can fulfill expected value of role.

[Paul Weatherhead]

One area I would have liked to see WorldatWork comment on was the foundation of sand that gender pay equity arguments are built on.

A long time ago I wrote a blog for Compensation Café describing how the US Census uses self-reported pay and job content data from citizens. http://www.compensationcafe.com/2010/10/the-gender-pay-gap-would-you-accept-this-compensation-data.html

Using this foundation for arguing that there are wage inequities across the country seems mighty weak. What respectable compensation professional would ever use self-reported compensation and job content data in their market studies?