I started a company to close the pay gap
I’ve worked in tech for 17 years. When I was just getting started, I was so excited to have career opportunities, I didn’t even bother to negotiate my salary. I took the offer they handed me without question. That’s not unusual for a rookie in her first job, but a low salary early on can have lasting implications.
Over time, I got better at checking market salary rates and bringing facts and data to the table whenever taking a new role, or asking for a raise. Eventually, I became a manager and set salaries for my team, and worked my hardest to advocate on their behalf.
I’ve learned through that experience that a person’s paycheck is connected to their self-worth. Being robustly compensated for a job well done leads to a feeling of pride and confidence. Conversely, learning that you’re making less than others can feel like a huge punch in the gut. Millennials, especially, are talking more than ever about what they earn.
Though salary negotiations are often a bureaucratic and budget-driven process for corporations, they are intensely personal for employees. That tension leads to a lot of issues with employee engagement and performance.
Studies show that for women, negotiating their salary is a catch-22 situation, where very often the odds are stacked against them.
That’s why I was inspired to start SameWorks. I wanted to help companies develop better processes to ensure they’re compensating everyone fairly within their organization.
We’ve built a software tool that helps companies identify potential issues, and adjust employee pay to resolve those issues. Companies receive a certification once they have passed our audit.
Tackling the pay gap
Most of you probably have already heard about the statistic of women making 80 cents for every dollar a man earns in the US. But did you also know that:
· Latina women make significantly less on average: 54 cents on every dollar.
· A black woman in the US needs to work on average 18 months for every 12 months a white man works.
· It’s estimated that at the current rate, the US gender pay gap will not close until the year 2152. If you have or are planning on having children, this is a problem their great-granddaughters will inherit.
As you can see, the problem is a societal one, and there are a lot of underlying reasons why this is the case. To tackle such a broad issue, we need many different tactics to fix the problem, including programs to help working mothers balance their careers and family commitments, as well as encouraging young women and minorities to pursue lucrative careers in technology.
We also need to focus on companies, who play a huge role in pay equity. Companies are empowered and ultimately accountable to pay their employees fairly, and not discriminate based on race or gender.
I noticed many businesses were trying to do the right thing, but not able to afford hiring expensive consultants to guide them through the process. I knew that we could use technology to help companies solve this problem in a way that benefits their brand as well as their employees, at a price point they could afford.
Having a certification also means that it’s easy for companies to talk about pay equity with their employees, customers, and candidates. Companies can proudly display the certification seal on their websites, job boards, and consumer packaging. We turn this annual process into a huge benefit for a brand.
Why companies miss the mark on equal pay
The underlying reasons most companies miss the mark have a lot to do with a lack of focus on defining roles and salaries for the different job functions in their company. Managers look to HR to set expectations, and aren’t as invested or empowered as they need to be to make good decisions about employee compensation.
If there aren’t detailed job descriptions, role levels and salaries pinned to these career ladders, most decisions about salaries are made on the fly, based on the outcome of negotiations with candidates. Unfortunately, it’s been proven that women tend to lose out on negotiations, even when they’re following best practices.
We’re working to help companies understand their role in pay equity, and to adopt some simple best practices around compensation strategies that mitigate these issues. These best practices include pricing the role and the work that needs to be done, irrespective of the candidate. It also means reviewing raises and bonuses to make sure they’re being issued fairly. Companies need to justify differences in pay based on acceptable criteria, such as merit, tenure, education, experience and quantity of work.
Our experience so far shows us that it’s not difficult for companies to adopt these practices and conduct the audit. It merely takes focus and commitment. I’m encouraged by what we’re seeing. I think if you see something that’s broken in the way the world works, and you have the capacity to go out and change it, you absolutely should pursue it.