Inspirations and aspirations in delivering pay equity
In society today, advocating for pay equity is no longer simply a moral endeavour, it is a social imperative, a movement that recognizes that even after some 50 years of equal pay legislation the gender pay gap stubbornly refuses to go away.
There are, of course, key advocates who have dedicated years of work to promoting conversations about the need to do better, and the urgency to eradicate long-standing gender inequalities. Each success that they achieve builds momentum for change.
One of the most dedicated advocates is tennis champion Billie Jean King. Her activism led to equal pay for men and women in professional sports at the United States Open in 1973. Her impact is still being felt beyond the world of tennis. She has influenced and galvanized organizations, governments, and indeed whole nations, and as an ambassador for EDGE, she remains dedicated to the pursuit of pay equity.
But the speed at which the gender pay gap narrows is glacial, impacting the economic security of women, their families and communities. In response, governments have been finding ways to advance positive progress in this area with the use of legal instruments that effectively ‘force’ organizations to do more.
As more and more countries respond to the issues of gender and pay, the requirement for organizations to report on gender disparity grows.
The gender wage gap for full-time work at median earnings is 12.1% (2022). So, for every $1 a man earns, a woman earns 88 cents. This ranges from 31.2% in Korea and 17.0% in the United States to 1.4% in Costa Rica and 1.2% in Belgium.
Source: OECD
The gender pay gap gives a broader picture of representation that may be caused by complex and often interrelated issues – such as starting salaries, absences from the workplace due to motherhood and caring roles, lack of career progression, and inadequate mentorship. However, it is widely accepted that a lack of pay equity also contributes to the gender pay gap and diminishes the effects of any organizational efforts to narrow this gap.
Therefore, it is not surprising that national and local governments are increasing their efforts to implement legislative frameworks for organizations aimed at narrowing the gender pay gap.
For some countries, such as Australia, Spain and Thailand, there have been regulatory changes around parental leave, making provisions more generous, or ensuring they are gender-equal to encourage more fathers (and non-primary parents) to be involved in the early months of a child’s life and ease the ‘penalty’ of motherhood.
In other countries such as Brazil and Canada, pay transparency obligations have also been introduced – but with little consistency in approach; different mechanisms are being implemented across different countries, making comparisons (and progress) difficult to measure.
Public disclosure policies, which require employers to disclose salary or total compensation information to job candidates and current employers, making them more accountable and helping workers to make better-informed choices, are being used in certain countries; equal pay reporting requirements have been introduced in others. Again, it adds further complexity to an already complex issue.
EU Reporting requirements
The EU’s Corporate Sustainability Reporting Directive (CSRD), introduced in January 2023, aims to improve the transparency and comparability of sustainability reporting across Europe. It applies from 2025 to the financial year 2024 for large organizations (those employing 250 or more people). By 2029, the threshold will be further reduced to capture more organizations.
The CSRD also applies to certain non-EU organizations. Those listed on an EU-regulated market are included from 2025 for the financial year 2024. From 2029, organizations with EU revenue exceeding €150 million, having a subsidiary office with over €40 million in revenue in the EU, or having a large or listed EU subsidiary, might also be included.
With its broadened scope, the CSRD will mandate almost 50,000 companies to share their ESG data, a significant increase from the previous Non-Financial Reporting Directive. Organizations should act promptly to prepare for the new reporting requirements and deadlines.
Reducing the burden of reporting
EDGE Certified organizations are required to undertake pay equity analysis as part of the certification process. The reports provide essential insights into compensation disparities, enabling them to identify and address any unexplained pay gaps. By taking steps to correct a pay gap the organization contributes to a more equitable workplace. It also reduces any potential legal risks associated with the gap, as well as fosters a culture of fairness and inclusivity for their employees.
The complexity of collecting and analyzing data required for pay equity analysis can be a constant challenge that requires long hours and often high costs. Organizations can significantly streamline their analysis and reporting requirements, however, with the help of a dedicated Pay Tool.
The new EDGE Empower® Pay Tool has been developed for EDGE Empower® users to help their organizations close their pay gap faster and reduce the burden of compliance. It has an intuitive design for effortless operation, and it can be customized for the organization. It means that variables like ‘Responsibility of the Role’ or ‘Type of Performed Function’ can be used to tailor the regression analysis and deliver more meaningful insight.
The browser-based Pay Tool works seamlessly across devices and can also be used offline. It offers speed of use with instant data loading and calculation to provide regression analysis in seconds. And, it has comprehensive data validity checks built in to ensure the accuracy of all inputs.
The EDGE Empower® Pay Tool has robust security and privacy to keep your data secure as it never leaves the user’s device. There are no third-party dependencies or APIs, and so therefore no risks of service disruptions.
Not only does the Pay Tool have a dedicated section for CSRD but it also simplifies compliance with a broad range of national and international laws, decrees and directives including the EU Pay Transparency Directive; Italy’s UNI/PdR 125:2022; the Spanish Royal Decree 901 and 902 / 2020; Swiss Legislation on Equal Pay; Brazil’s Pay Equity Law; US Equal Employment Opportunity Commission (EEOC); and Japan’s Act on Promotion of Women’s Participation and Advancement in the Workforce (APWPAW).
We’re here to support you on this important journey
Request your EDGE Empower® Pay Tool free trial here.
To find out more about the EDGE Empower® Pay Tool here.
