Narrowing the Gap: Pay Equity

Pay Equity and Pay Equality

Ms. Tyman views pay equity as a fairness comparison, although pay equity and pay equality are often used interchangeably.

• Pay equality are grounded in legal theories such as equal pay for equal work
• Pay equity is also good for businesses, especially in the time of the Great Resignation, and potential employees are looking at what their potential employers can offer them.
  • Beyond fair pay for everyone in a workplace, it is also important to look at the corporate culture of a business

The Importance of Data

• The data is important when talking about compensation to impact the workforce, and what employers value such as performance, experience, etc.
• Data can often expose overlooked issues that the business may not be aware of, and the data can tell the story of what is actually happening and where there might be gaps.

Equal Pay Day Legal Update

• Each year, Ms. Tyman and her team post a legal update every year regarding Equal Pay Day and pay equity. This year, they are also releasing a webinar.
• The 2021 report is looking at amendments to equal pay laws at the state level, an increase in salary history bans, and payscale disclosure requirements and transparency requirements, as well as required reporting of compensation data.
• In 2020, the report noted an acceleration in employer focus on equal pay, and this trend continued in 2021.
  • Employers are very focused on compensation, and are looking at reports as well as proactively disclosing pay metrics.
• In 2020, the report also showed an increase in passage of pay equity laws which was also prominent in 2021.
  • Illinois passed a law to require employers to proactively provide employee level compensation data to the Illinois Department of Labor
  • NYC is requiring employees to provide more transparency in the salary ranges for specific jobs.
• 2020 showed an increase in litigation under federal and state compensation laws, and equal pay claims have continued in 2021
  • There have been a number of class action suits regarding pay equity and fair compensation, which are anticipated to continue in the near future.

Narrowing the Wage Gap

• On an employer front, there is an increased desire to look at compensation in different ways, and look at what the data indicates in terms of how companies should measure compensation.
• Regardless of what employers decide about compensation transparency, the conversation about pay equity is driving changes in behavior and driving internal changes to look deeper from pay and data perspectives.
• Pay audits and reviews look at what the scope of what the review might be, and then analyze what the components of the audits might entail.
  • These audits look at a company’s compensation structure, and the audit measures if how the company compensates measures up to how employees are paid, and if there is fair pay based on gender, geography, type of work, and other necessary factors.
  • These analyses look for overall pay equity, and gender pay equity, but often these audits find that compensation policies and practices need to be revised as a whole.
  • Overall, these audits are designed to make practice and structural adjustments at a corporate level to institute pay equity based on a number of factors.

Pay Equity Resources

• Seyfarth Shaw LLP provides reference guides for employers to help them navigate their compensation requirements, as well as a litigation report which outlines key litigation matters in the workforce. They also have a pay equity desktop reference, which is a survey about what state laws are regarding compensation and pay requirements. 
• They work with employers to be proactive about compensation policies, perform pay audits, and work on in-house litigation matters.
• They also look at industry based issues regarding diversity and inclusion, and how these can have an implication for pay equity issues.

Guest Background

• Doctor of Law (J.D.), Law from Loyola University Chicago
• MBA from Loyola University Chicago
• Ms. Tyman is currently a Partner at Seyfarth Shaw LLP

Contact

• Annette Tyman on LinkedIn
• Annette Tyman email: ATyman@seyfarth.com