With increase in pay transparency and pay equity legislations, organizations are taking this opportunity to rebuild their compensation practices. Some are taking this as an opportunity to generate awareness, while others are using this opportunity to generate confidence and/or engagement. Whatever the case be – organizations are taking an approach to communicate pay.
Pay equity aims to ensure that individuals receive equal pay for equal work regardless of protected characteristics. According to World at work 2021 Pay equity survey results, 84% of organizations with more than 10,000 employees, while 56% of companies with fewer than 1000 employees are taking some action to focus on pay equity. Here in Canada, The Pay Equity Act, applicable to federally regulated employers, aims to achieve pay equity by ensuring that female-dominated job classes are paid at least the same as male-dominated job classes of equal value.
With legislation affecting how organizations pay their employees, it is important to go back to basics i.e, Getting your house in order. Take a step back and see if you have a well-functioning, well defined ‘nature of work’ and ‘level of work’ framework for jobs. If need be, take a step back even further to conduct a Job Analysis (of course this may take time – but worth effort if job has significantly changed over time)
Nature of work simply put- Why does a job exists. It’ll cover things like task performed, responsibilities assigned, overall purpose of the role and takes into account work environment, autonomy, collaboration, technological advancement that has influence on work.
Level of work refers to complexity of work, scope , decision making associated with a particular job and often categorized into hierarchical levels – like entry, senior, experienced etc.
Big firm compensation consultants will have something build inhouse that clearly articulates this concept succinctly and often referred to as a Job Architecture/Career framework.
According to Willis Tower Watson’s 2023 pay transparency survey nearly 40% of organizations surveyed lacked clear framework that defines nature and level of work which is holding back pay program communication thus affecting the objective of pay transparency.
As Marie Kondo says, “Putting your house in order is the magic that creates a vibrant and happy life.” So, start by getting your house in order.