If you haven't heard already, Goldman Sachs just agreed to pay a whopping $215 million to settle a lawsuit brought by current and former employees claiming they consistently underpaid women associates and vice presidents over the past 21 years. It's an important reminder that pay disparities are still a reality in today's workplace landscape. According to this 2023 article, on average, women earn just 82 cents for every dollar earned by a man. And women of color earn even less. This not only affects the paychecks, but the lower earnings result in 30% less contributions to retirement accounts then men.
There are many takeaways to learn from this settlement, one of them being your employees shouldn’t have to ask to be paid fairly. You should just pay them fairly from the start.
It’s not just the right thing to do - it's good business. So how do you know where your organization stands in relation to the market or if there are underlying pay disparities? You start with a compensation benchmarking study coupled with a compensation analysis.
Why compensation benchmarking is important:
- Mitigate Legal and Reputational Risks: We've all seen what happens when companies don't get it right. In the United States alone, 43 states have introduced or enacted pay equity laws. Lawsuits and bad press can be costly, not just in dollars, but in the damage they can do to your reputation. Regular compensation benchmarking and analysis can help you identify and rectify potential issues before they become legal problems.
- Build a Positive Work Culture: Fair compensation practices are essential for building a positive work culture where employees feel valued and appreciated. When employees are engaged, they're more likely to be productive and contribute to your business's success.
- Attract and Retain Top Talent: In a competitive job market, a fair and equitable compensation strategy can help you stand out as an employer of choice. By showing potential candidates that you value their skills and contributions, you can attract and retain top talent that will help your business thrive.
At Leath HR Group
, our team truly understands the power of compensation benchmarking and analysis. These tools can help you get ahead of potential inequities, and ultimately ensure your organization is treating all employees fairly while being competitive in the talent market. When you work with us, this is what you get:
- Gain Insights from Reliable Data: We utilize robust data sources and industry benchmarks to provide you with a clear understanding of where your organization stands in terms of compensation practices. This data-driven approach enables you to make informed decisions based on objective information, leaving no room for guesswork or assumptions.
- Pinpoint Areas for Improvement: Through in-depth analysis, we identify any gender pay gaps or inconsistencies within your pay structure. This allows you to target specific areas for improvement, ensuring that your compensation practices align with your commitment to equal pay and fairness.
- Design Competitive and Equitable Pay Structures: Armed with the knowledge gained from benchmarking and analysis, our team works closely with you to design pay structures that are competitive and promote fairness and diversity. We believe that by compensating employees based on their skills, experience, and performance, you can foster a more engaged and productive workforce.
Over the past 8 years, we’ve helped numerous organizations develop equitable compensation strategies that align with their business goals and values. Let's work together to create a future where every employee feels valued and motivated and is rewarded fairly for their contributions. Contact us
today for a free consultation!