Pay Inequity

Pay Inequity

18:04 29 August in Discrimination, Diversity, Genders, Generations, Human Business, Innovation, Jobs, Workplace
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“People don’t care who they hurt or beat. For the love of money.” excerpt from the song “For the Love of Money,” by The O’Jays

Pay inequity. This is a well-worn topic that has been getting a lot of attention, especially over the past few years. Pay inequity is an insidious practice felt by many and one that knows no boundaries. Undeniably, it’s more targeted at certain people based on their gender, age, occupation, education, race, religion, and geography. There are even people in the Hollywood spotlight who have spoken out against this transgressive bias, as even these privileged few have felt the wrath of pay inequity’s duplicitous effects.

Albeit the United States Supreme Court has laws in place to counteract the negative effects of pay inequity, it’s still an all-too-common occurrence, because these laws are not properly enforced with assurances of stringent consequences to the offenders.

You’ve Not Come A Long Way Baby

From 1974 through 2014 the organization, American Association of Women, conducted a research study that found female workers in the United States were garnering salaries (depending on the state) that range from ten percent to thirty-five percent less than their male counterparts doing the same job with the same number of years’ experience. This same organization predicts that based on the current salary trend, it will take another 100 years for this pay gap to close. Further, according to the Organization for Economic Cooperation and Development, the United States is one of the more egregious countries when it comes to the blatant practice of pay inequity in the gender pay gap.

The topic of pay inequity is not just a matter of gender and race bias, however women, especially those of color, tend to be at the bottom of the pay scale. According to an article in The New York Times, a 2016 research study uncovered the harsh reality of how businesses view work performed by women. The study found that duties completed by women are not perceived as being a value-add in the workplace. Further, some researchers suggest that society places pressure on women to pursue historically lower paying female-oriented jobs versus seeking jobs that men have traditionally held. The conclusion here is that women succumbing to these pressures are being suppressed by a society that is not ready to view women as equals to men in the workplace and beyond. But women are not the only people suffering from this bias.

Other Casualties

The topic of pay inequity goes beyond targeting women; it similarly affects both women and men of color. Valerie Wilson, an economist at the Economic Policy Institute, determined that the pay discrepancy between white households and black households in the United States, has widened since 1979. Further, the National Women’s Law Center found that the average Latin male and female employee would have to work 73 years longer to collect the same pay as their white male counterparts.

The National Bureau of Economic Research economists, Carruthers and Wanamaker, conducted an investigation to unearth wage discrepancies against black men during the 1940’s. One thing they uncovered was certain localized laws from the 20th century and earlier (mostly practiced in the southern area of the United States) set a precedence where segregated, oppressed black citizens were only allowed access to public schools where very little money was endowed and with that, adequate education was lacking to advance and support post-school employment to better-paying jobs. The sad truth is this oppression is still felt and imposed on black working Americans decades later.

Additionally, a combination of age, inexperience, and gender can, also, come into play when pay inequity is suspected. As employers are evaluating people entering the workforce and considering their universally under-developed skills, instances of young females being paid less have been reported when compared to males in the same age group.

How Can We Solve This Problem?

As a society, we need to re-examine certain perceptions and traditions, however if we cannot come to a consensus, we will never move the needle forward to solve the problem of pay inequity. To begin, better wide-spread education and public awareness are a must. People need to know where their money is going and how it is being spent. There are many suggested solutions from varying pundits to remedy the pay inequity problem, but they need to see a follow-through on execution. Three such ideas are:

  • Cap CEO pay
  • Increase taxes on the super-rich
  • Penalize companies for shipping jobs abroad

  • Clearly, when it comes to these ideas, we need an aggressive plan of action. Capping CEO salaries can be done but certain considerations need to be identified first. Who will be the oversight to enforce this? How will the appropriate consequences be determined and how will the policy be imposed? Which CEOs fall into the capped salary structure? Obviously, publically traded companies must disclose their financials, so they’re the obvious choice, but are there other companies which should be considered? Also, setting a limit on CEO exit plans, where all too often, the golden parachute is a ridiculous amount of money. Increasing taxes on the 0.00001 percent of the population that are billionaires is certainly worth a long look. As one solution, a structured plan can be imposed with proper tax levying based on capital gains within identifiable tax brackets. Penalizing companies for sending work abroad is a good idea, but companies need to be properly incentivized to want to keep work here. If companies choose not to observe, then imposing penalties such as paying tariffs, along with increased income tax for business conducted here may need to go into effect. Also, as part of keeping consumers informed, boycotting the company’s products and services may be used as a message to companies that do not comply.

    These three options are just a few in a long list of other proposed solutions that have many layers of complexity to consider. With thorough consideration, they can work, but a better understanding of the consequences and benefits needs to be carefully weighed first. We need a workable solution with quantifiable outcomes and accountability that incentivizes companies to do the right things and a system in place that oversees the follow-through on the execution of the policies. Conjecture is not going to get us to where we need to be. Caring, listening, talking, resolving and taking the appropriate steps to stop pay bias is the right thing to do… of this, I am sure.

Doug Coull

dfc@aps2k.com

Doug Coull is the founder and CEO of APS, Inc., maker of SmartSearch talent acquisition and staffing management software. Doug founded APS in 1986 after a successful management career in the contract engineering industry. Under Doug’s leadership and unique perspective on the development and user adoption of software and technology, APS pioneered the resume scanning based system as a new approach to digital candidate management. In the ensuing years, APS continues to reign as one of the industry’s most innovative software developers in the field of HR technology. APS currently services customers on five continents, serving both corporate human resources, as well as the staffing industry. Doug attended Augustana College and the University of Minnesota. He’s the father of two sons and is an avid automobile enthusiast. Doug lives in North San Diego County, California.

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