HR-Pay Equity

Pay Equity
Pay Equity

Pay equity is equal pay for work of equal value. That means if two different jobs contribute equal value to their employer’s operations then the employees in those positions should receive equal pay. Jobs that are commonly held by women tend to be paid less than jobs commonly held by men – even when the work is comparable in value based on skill, effort, responsibility and working conditions.

Pay discrimination on the grounds of gender is prohibited by Human Rights legislation in British Columbia, Alberta, Ontario, Saskatchewan and equal pay for same or similar work is a requirement of employment standards legislation in Ontario, Manitoba, Saskatchewan, Yukon, Newfoundland and, Northwest Territories.

How Does Pay Equity Affect Your Business

EMPLOYEE MORALE

  • Employees who feel they are treated unfairly are unlikely to perform at their best
  • Equal pay encourages a more content workforce, which can have a significant impact on productivity

EMPLOYEE RETENTION & NEW HIRES

  • If an employee suspects she’s being paid less than her male counterparts, she’s likely to consider other employment opportunities
  • Pay inequity can lead to higher rates of employee turnover, with the attendant costs of hiring and onboarding new talent
  • Finding new talent may be difficult for a business with a reputation for unequal pay
  • Most of the Canadian workforce–67 percent–report being unwilling to apply for jobs at any company they believe practices wage discrimination

Complaints and Litigation

  • Unequal pay in the workplace can lead to complaints to human resources and potential litigation under the federal Equal Pay Act or local pay equity laws
  • If your case goes to court, your business may be liable for lost wages, emotional damage, and legal costs
  • A court case also leads other employees to question whether their own wages are fair or not

Public Relations

  • Unequal pay for women and minorities is a hot button topic in both the media and on social media. If a rumor of pay inequality in your workplace goes viral, it can destroy your company’s reputation and brand

Addressing Unequal Pay In The Workplace

A proactive approach to pay equality helps prevent issues with unequal pay affecting your business. Some companies resolve the issue with a set system for determining pay that’s applied to all employees. Such systems determine pay based on position, work experience, and education, and effectively remove the risk of assigning different employees different pay for similar jobs.

Regularly reviewing employee compensation helps identify and fix pay equity issues. Remember gender discrimination goes beyond unequal pay. If your company routinely hires women for certain positions and men for others, you could be laying the groundwork for a discrimination lawsuit.

HR-Pay Equity

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