Nationwide, women earn 82 cents for every dollar earned by men. That adds up to a difference of $11,165 between the average salaries of working men and women. Despite the fact that the Equal Pay Act of 1963 has been in effect for 60 years, a pay gap persists. What can small business owners do about it?
Review business policies and practices
Even if business owners have a mindset of offering equal pay, this may not work out due to business policies and practices. Changes may be needed.
- Audit your pay. Investigate your company’s compensation structure. Compare the salaries of men and women in similar roles. There may be legitimate reasons for differences in pay, such as location and work experience. But if there are discrepancies that can’t be justified, take immediate action to rectify them. This process is crucial to ensure fair pay and promote gender equality in your organization.
- Set equitable hiring practices. Establish fair hiring practices. Standardize the compensation for each position. This approach can help eliminate gender bias in salary negotiations and ensure that all employees are paid fairly for their work.
- Offer flex time and remote work. Part of the reason why some women have been paid less is because they have been unable to remain in the workforce while raising a family. Today, women can work and attend to family responsibilities if there are flexible schedules. By accommodating different needs, equal pay for women can become standard business practice.
- Support pay transparency. More than half a dozen states and a number of localities have laws that require employers to disclose to job applicants and employees information about compensation. Businesses in states without such a law can do so as well as a way for all employees to know the compensation for a particular position without regard to gender.
Overcome implicit bias
While explicit discrimination has decreased over time, implicit or unconscious bias continues to impact women in the workplace. Studies show both men and women often harbor ingrained biases that influence their judgment.
For example, identical resumes with male and female names elicit different perceptions of competence and hireability. Managers also grant greater access and career encouragement to employees they unconsciously view as similar to themselves.
There are various training and resources available for recognizing and managing implicit bias as a leader. Taking the initiative to create a fair workplace culture where everyone can thrive will serve a company well.
Conclusion
When each small business commits to equitable policies for pay, it sends a powerful message that reaching pay parity is both a moral and economic imperative. Some companies have been working toward pay parity. For example, Salesforce in 2015 expressed commitment to address general pay disparities and has adopted such practices as regularly reviewing employee salaries to ensure fairness and, most recently, offering equity grants. As Salesforce and other companies have demonstrated, taking action can help make equal pay a reality.
Read more about gender wage gap here.
