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The Gender Pay Gap

IT systems are part of the gender pay gap problem with digital process optimization and automation, they can also be part of the solution.

The gender pay gap is a news item that’s not going away.

And that’s for very good reasons. Equal pay matters for commercial and economic prosperity and productivity, as well as being an obvious and ethical corporate responsibility.

Figures compiled by the UK’s Office for National Statistics show the average gender pay gap for full-time work is currently 13.1 per cent (November 2019). A PayScale report found that in the US, women still make only $0.79 for each dollar men make in 2019.

Rightly, legislative measures and penalties are in force and becoming more punitive for organizations that don’t acknowledge or tackle unfair pay disparity.

It’s not just a gender pay gap

Gender isn’t the only factor to consider. Ethnicity, religion, caring responsibilities and age can also create inequalities. Conscious or unconscious bias, a lack of formal process, subjectivity, poor individual decision-making and a lack of governance may all have contributed to unequal pay. Bottom line: every organization needs to scrutinize both their policies and practice in pay scales and award frameworks as well as the actual salaries and incentives they’re paying out today. To do that, you need data, control and insight.

If you’re tackling pay gap issues at the moment, there are two aspects to consider. Firstly, a ground-up review of the current situation, with remedial actions. Secondly, the ongoing process of verifying and maintaining fairness.

With large workforces and a wide range of pay scales and reward arrangements, it’s impossible to collate and analyze all your pay data by hand – either as a one-off or for regular reporting. If you have a sales performance or total pay solution in place, you may have a head start, with a system of record that helps you identify who’s being paid what via which scheme. But is it a comprehensive one? A big problem in rectifying pay gaps and inequalities is that vital information you need to understand and address them is scattered throughout systems, databases and spreadsheets.

You need comprehensive pay data and insight

This could be a good moment to look at digitally optimizing and connecting all your current pay and reward systems, to provide a single system of record. Clear and complete data is a critical first step in ensuring pay parity across your workforce. You may be able to use robotic process automation or human emulation to streamline processes and marshal data from diverse HR and pay systems, so you can conduct an initial review and maintain oversight and reporting.

Sales and commission plans make the issue of pay reporting and equality even more complex. The UK government identifies differentials in bonus schemes and payments as a potential cause of gender pay gap issues for employers, in their paper Eight ways to understand your organisation’s gender pay gap, published by the Government Equalities Office. It’s not just about how much you’re paying, it’s also about equal opportunities for commissioned employees in terms of territories and accounts. You’ll need to evaluate data and insight from sales planning tools and systems, alongside input from deals, pay and commissions solutions.

There’s more than a direct financial payback

Traditionally, we have talked to customers about the ROI and cost-saving advantages of system and process automation to support accurate and timely pay and reward calculations and delivery. There’s also a substantial benefit in demonstrating to current and future employees that your pay, incentive and reward policies and practices are fair, attractive and consistently applied. On the flip side, you can’t afford to lose time and money firefighting pay gap issues, dealing with the resulting attrition and reputational damage.

People are more productive and focused when they trust their employer to remunerate them properly. A collaborative culture can thrive when employees know everyone is treated fairly and equitably and receiving equivalent rewards for the same effort, responsibilities and achievements. This will help you attract and retain the best workforce overall.

Use technology to make your organization a trailblazer for fair pay and rewards

By taking a proactive stance on gender or any other kind of pay gaps, your organization can avoid expensive lawsuits and reputational damage. A single source of pay data and effective reporting can help you uncover and tackle any anomalies in remuneration or sales plans before your employees bring them to you. With an evaluation of the current situation, your HR team can use evidence and insight to train managers, review policy and monitor ongoing pay.

The World Economic Forum’s Global Gender Gap Report 2020 says men and women will have pay equality in 257 years. Clearly that’s way too long to wait. By applying smart process automation and analytics, you could get on top of the issue within months.