Pay equity ensures fairness in compensation by prohibiting discrimination based on protected characteristics such as age, sex, gender, and ethnicity. Instead, factors consistent with your pay strategy (e.g., performance) should dictate differences in pay.
This topic is crucial for organizations as they navigate decisions regarding employee compensation. Non-compliance with pay equity laws such as The Equal Pay Act of 1963, Title VII of The Civil Rights Act of 1964, and The Lilly Ledbetter Fair Pay Act of 2009, as well as state-specific laws, can lead to legal challenges.
Analyzing pay equity is essential to identify and rectify any unjustified pay disparities within an organization. Addressing such issues promptly can prevent outcomes such as talent loss and reputational damage.
A pay equity audit examines a company's internal pay structure and job roles to provide accurate insights. As an independent consultant, HyperEquity can provide you with an unbiased analysis of your pay equity and offer independent assessments to uncover potential pay discrimination and trends, facilitating proactive corrections.
Working alongside HR teams and legal counsel, our audit process includes:
Identifying comparable job roles, emphasizing accurate job titling and descriptions.
Analyzing data across identified job groups to ensure fairness across all protected classes.
Incorporating individual factors like experience and performance to refine compensation assessments.
Ensuring pay differentials comply with federal and state laws, justifying variations based on seniority, merit, or production metrics.
Documenting findings and implementing corrective measures where discrepancies are identified.
Assist in the establishment and implementation of a communication plan that's right for your organization.
By conducting a pay equity audit, organizations not only mitigate litigation risks but also foster a more equitable work environment, gaining a competitive edge in their industry.