Commemorating Equal Pay Day

OK, so it may not be the most celebratory of occasions on the year’s calendar, but it is nonetheless well worth an HRE Daily post to acknowledge the persistent pay gap that has plagued women ever since joining the workforce many decades ago.

To that end, HREonline.com just posted a piece this morning titled “Pay Equity: New Challenges, New Pressures, New Strategies.” Written by Mercer’s Stefan Gaertner, Gail Greenfield and Brian Levine, the piece takes a look at the gender-pay landscape and what new challenges HR faces in ensuring a balance between the genders when it comes to pay:

More aggressive regulation for pay equity is clearly a trend. We believe this represents a stern call to action for employers to review their job and pay structures as well as analyze pay differentials to ensure that they understand their data, with a focus on pay gaps and business-related factors that may or may not explain them.

Employers also need to rectify any issues identified. We find that the all-too-common “wait and see” approach is not effective — once a plaintiff knocks on the door, it is too late to craft a story or actually address gaps in an orderly fashion.

Elsewhere in cyberspace, there’s an interesting piece on CNN.com titled “One Way to Close the Pay Gap for Women,” written by Mary Ellen Carter, an associate professor of accounting with the Carroll School of Management at Boston College, whose research focus is executive compensation.

In the piece, Carter argues that organizations can shrink or eliminate the gender-pay gap by including more women on corporate boards:

In new research, my co-authors and I found that pay gaps are much lower when more women serve on corporate boards.

For example, the proportion of female directors at the Massachusetts company TJX (parent of T.J. Maxx, Home Goods and other apparel and home goods retailers) has hovered around 30% since 2006.

And in our analyses, Carol Meyrowitz, who retired as TJX CEO in January, was paid fairly, relative to executives of comparable companies as she rose through the ranks.

TJX illustrates what our overall analyses show — that this effect flows deeper into the executive pool. Other top-level female executives, like chief financial officers, are also better paid when the board includes more women.

It’s true that there is no easy answer or silver bullet to create an even playing field in all respects, but here’s hoping by the time the next Equal Pay Day rolls around, more organizations will be working earnestly to ensure the compensation rates between men and women will be even closer than it is today.