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The Secret to Closing Pay Gaps Isn’t Raising Salaries


In 2017, on average, women made 80.5 cents for every dollar earned by a man. And while that wage gap is shrinking slowly, at its current pace, it won’t snap shut for another 40 years. For women of color, it will take years longer.


Equal pay for equal work is one of those concepts that’s hard to disagree with. Yet the news is frequently flooded with stories of rampant pay discrepancies, from the highest echelons of Hollywood to the lowest rungs of the food industry. In response to the growing controversy, companies like Nike are rushing to adjust the salaries of thousands of underpaid employees.


Strategies like this are important for increasing fairness. But they’re band-aids, not cures. They won’t eliminate the underlying problem: the role unconscious bias plays in salary decisions.


Research has shown that when a candidate’s resume indicates she is female, she’s more likely to be offered lower pay. And the gap between male and female employees’ salaries widens if a woman has children—an effect known as the “motherhood penalty.” In fact, one study found that nine years into their career (right around prime childbearing age for women), male business school graduates earned a whopping 60% more than their female peers.


A one-time wage hike to establish pay equity won’t matter in the long run if bias continues to impact starting salaries, raises, and bonuses. The gaps will creep back in—unless companies take steps to keep bias out of compensation decisions.


At career.place, we advocate for a blind evaluation process in hiring that compares all candidates against clear, objective criteria to determine the best person for the job. And while you’ve likely met the candidate by the time salary negotiations are on the table, applying clear, objective criteria (like experience and local cost of living) to the decision-making process ensures a fairer outcome.


Establish the criteria before you meet a single candidate and stick to it. Then, create a similar set of criteria to calculate raises. If possible, get someone who doesn’t know anything about the candidate or employee to make that calculation based on their resume or profile (which should be blinded first).


To test how effective these policies are, audit yourself. Do it regularly, and tweak the process if you notice bias slipping in. Making salary ranges more transparent and scrapping any policies that prevent coworkers from discussing pay can also help build a fairer workplace—and earn employees’ trust.


Want to ensure bias isn’t hurting your hiring process? Try the career.place way today.


#NoBias


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