The past few weekswe’ve discussed the importance of providing pay transparency resources to your members in light of new regulations spreading across the country. However, regulations are not the only reason your organization should be providing these resources to your members. Pay transparency and DEI (Diversity, Equity, & Inclusion)are intertwined and by excelling in one, you are certain to start excelling in the other.
So, what does Pay Transparency have to do with DEI and Organizational Culture? 3 things to consider:
1. Hiding Salary Ranges Can Create a Culture of Distrust:
When salary ranges are not disclosed, employees and candidates find themselves in a position to speculate what others in similar roles are making.It is human nature, right? We all want to know that we are being compensated for the work we provide in a comparable mannerto others. By knowing the range of pay for a particular position, employees and prospective candidates know what their growth potential is and that they are not being undercompensated for their position.
2. Pay Transparency Helps Define Professional Growth Plans:
When an organization makes the decision to release pay transparency information, they will also want to ensure they have clearly outlined salary formulas that are tied to that position’s professional growth plan. This ensures that pay incentives are based on objective measures such as met performance KPI’s and not unconscious bias or discrimination. While this clearly helps employees understand that your organization is focused on equal and fair pay based on production and not subjective value, it is also good for budgeting purposes for the organization. Management can easily assesswho has met their promotion goals and then budget accordingly.
Pay transparency is a term that you have probably heard a lot about recently, and if not, then there is a very good chance that you will soon.
SO WHAT IS PAY TRANSPARENCY?
Like all new laws or regulations, this one comes in a number of different iterations, but it is another regulation that helps to ensure pay equity. However, the bottom line is that if your organization is located or has employees in one of the 13 states or cities (more coming soon) that has enacted these regulations, then it is the law for you. Your area's specific regulations dictate your required actions but at a minimum you must disclose the pay scale for every position.
WHAT DOES THIS HAVE TO DO WITH BENCHMARKING?
Benchmarking not only helps your members with one of the most important member benefits that an association can provide, but it also can now help your members with pay transparency/pay equity regulations. If your association is not providing compensation and benefits data to your members, then you should seriously consider making this a cornerstone of value-added benefits that you offer. A legacy type of survey does not allow the member to filter and benchmark against peers, so they run the risk of being out of balance with the industry. In terms of pay transparency, members that have data to make their decisions are more competitive and efficient. This can be extremely impactful to not only your members' bottom line, but also significantly impact the culture at their organizations.
IS THIS SUBJECT IMPORTANT TO MY MEMBERS?
That depends: if the member is a high performing organization that attracts and retains great talent then, you can bet it is very important. Today’s workforce demands that their employer understand pay equity and high-performance teams that are intertwined with a culture of success. It is impossible for employers to create this culture without knowing the numbers that lay the foundation for success. Your association is the natural hub for this type of data and your members are hungry for it.
Dynamic Benchmarking has many years of experience providing compensation and benefits benchmarking to associations. We can quickly help you setup pay transparency studies with easy to understand reports for your members to be more competitive in their respective markets. Click here to schedule a meeting with our team.
Compliance plays a role in every organization and often there are programs or actions that are a direct result of ensuring compliance. It is fine if these programs involve transactional only items, but DEI is more than transactional. It is about the culture of the organization, the success of the team and ultimately the bottom line. Compliance may be able to address the diversity part of the equation, but that is not nearly enough to thrive it in today’s environment.
I learned in one of my finance or economics classes (can’t really remember which) that economic and stock market growth can sometimes be as much a psychological exercise as it is a physical or fundamental exercise. Meaning, when people feel good or positive about something, it can have a strong impact on the performance of that activity. This is true in many areas of our lives. I know that when I stand over a golf ball on the tee box that my confidence meter is never completely neutral, it leans one way or another and typically my tee shot follows.
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