How Can Employers Prevent Pay Gaps in Their Company?

There have been efforts made to begin closing the pay gaps, but we are not close to the finish line. Although it is illegal to pay women, Black and Hispanic individuals less than their counterparts for doing the same jobs, it still goes on, often with no coincidence. The cause of pay gaps has not been narrowed to one thing, so it can be tricky to fix quickly. What may be driving the gender pay gap:

Discriminatory hiring/pay practices

Whether we know it or not, there are many biases that go on within the hiring process that may cause those doing the hiring to pay certain employees less than their peers for the same work, or continually choosing to hire a particular group for higher-paying positions.

Choice of occupation

Whether by choice or by necessity, many women end up working jobs with lower wages. With the disproportionate representation in these fields, it has an overall effect on earnings.

Family leave

Since women tend to be the ones to take parental leave or time off to tend to children, this impacts pay gaps.

Let’s consider some ways to promote fair pay structures for all.

Stronger Pay Transparency

When employees are discouraged from sharing salary information, it can be difficult to really know if compensation is fair. Transparency can be improved with more open discussions regarding compensation. These honest exchanges within the workplace can lead to significant change.

Unionize Workplaces

Unions’ pays tends to be more fair which may be attributed to more equitable pay practices that unions often promote, such as standardized wages, pay transparency, and grievance procedures in the event of discrimination. Unionized workplaces are also commonly more helpful with scheduling accommodations and paid leave.

Fair Scheduling Practices

Unpredictable schedules have an especially strong effect on women who care for dependents, since unpredictability makes it difficult to arrange for childcare or manage family schedules. Pay gaps can start to reduce when all employees have a right to scheduling accommodations.

Stop Using Salary History to Determine Pay

Using salary history from previous jobs to determine a new hire’s wage is not effective. This method affects individuals across all industries and positions. It is best to set a clear salary range for the position at hand and be completely upfront about it. Applicants should not have to disclose their salary history.

Improve Work-life Balance

A better work-life balance may also reduce the pay gap for those with additional responsibilities outside the workplace. The demands of family and career can be very challenging to manage, causing people (often women) to work lower-paid, more flexible jobs, work only part-time, or even leave the workforce. Employers can foster a flexible work environment to retain working mothers and parents.

Fix Pay Disparities

The gender pay gap is complex, with many evolving factors. Employers must consider how they will avoid unconscious bias within the hiring process and salary negotiations. However, they must also fix the gender pay gap from within their company, regardless of the cause. Consider conducting a pay audit to find if men and women are being compensated fairly. Then, you can offer pay increases to those who are making less than their peers. It is crucial to assess and always strive to improve employee pay to encourage a fair workplace. Employment practices insurance can save your business if you find yourself in a position where the business was not acting fairly.

About SB One Insurance Agency

At SB One Insurance Agency, we have served the businesses and residents of New Jersey, New York, and Pennsylvania for more than 65 years. We are a wholly-owned subsidiary of Provident Bank, the region’s premier banking institution, and we are prepared to offer you personal, business, employee benefits, and risk management solutions. To learn more about our coverage options, contact our specialists today at (888) 990-0526.