Gender Pay & Pay Equity

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Most US multinationals conduct regular pay equity audits, but for further insights into promoting equity and removing potential bias in compensation, companies are increasingly exploring adding performance ratings audits to the standard review cycle.

Performance ratings can often have a large impact on an employee’s rate of pay and/or bonus compensation. However, for many companies, performance ratings are discretionary, given by managers without specific guidelines or training to follow and without many (or any) checks and balances. In addition, considerations regarding leveling of job descriptions, both at the time of hire and as employees matriculate, may impact performance ratings. Because the results of a pay audit are only as good as the data inputs, it makes sense to take a closer look at how the underlying data comes to be.

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Continue Reading Taking Your Pay Equity Analysis To The Next Level: Performance Ratings Audits

Special thanks to guest contributors Monica Kurnatowska, Bernhard Trappehl and James Brown.

In brief

The EU Commission has proposed a directive that would reinforce the entitlement to equal pay for men and women for the same work, or work of equal value, including by giving employees the right to comparative pay information and by requiring gender pay gap reporting for employers with 250+ employees, amongst other measures. Some EU member states already have aspects of these rules, while others do not, meaning that the rules could be a significant additional compliance burden for some organisations. The rules, if adopted, would be unlikely to come into force before late 2024.

Key takeaways

The EU Commission has proposed a new directive on pay transparency. If adopted, it would:

  • Require measures to ensure employers pay the same work, or work of equal value, equally.
  • Require employers to provide initial salary (or salary range) information to job applicants, pre-interview.
  • Prohibit employers from asking job applicants about salary history.
  • Create a right for a worker to request information about:
  • Their own pay level
  • Average pay levels, broken down by gender and categories of workers doing the same work / work of equal value
  • Require gender pay gap (GPG) reporting for employers with 250+ employees.
  • Create joint pay assessments if:
  • GPG is 5%+ for any category of workers doing the same work or work of equal value, and
  • employer has not justified the GPG.

Based on previous experience, we estimate that these proposals, if adopted, would need to be implemented by sometime in late 2024.

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Continue Reading European Union: Commission Proposes Pay Transparency Rules to Secure Equal Pay

As employers contemplate using compensation to incentivize employees and management toward achieving the company’s I&D goals, our global counselors and litigators share a framework for thinking through both the practical and legal considerations when designing a reward system related to I&D.

Click here to watch the video.

In his first day in office, President Joe Biden signaled that his administration will take a different approach to D&I in the workplace than the previous administration. Corporate leaders should continue investing in D&I work, implementing policies that create equity and foster inclusion for underrepresented minorities, such as enforcing zero-tolerance rules for discrimination, harassment and…

California Gov. Gavin Newsom (D) closed this most recent legislative season by signing dozens of new bills into law that affect California employers. Though some were emergency bills and took effect upon signing, the remainder take effect on Jan. 1, 2021.

The laws are wide-ranging, encompassing topics from pandemic-related measures, to the first board of…

It’s hard to miss the uptick in litigation against high profile US companies over alleged unequal pay for female employees these days. Cases seem to hit the headlines frequently and several targeted industries include professional sports, professional services organizations, and technology companies. With equal pay protections constantly expanding, and employees often seeking class certification, in 2021, employers should be especially diligent in identifying and rectifying unjustified pay disparities.

So, if you need a New Year’s Resolution, consider undertaking a pay equity audit. This will position your company to determine, at baseline, whether any unjustified pay disparities exist, where those disparities lie and proactively take any remedial measures to help mitigate against becoming a headline. In conducting a pay equity audit, employers should pay close attention to the legal backdrop of pay equity, and how that landscape is changing.

As we head into the New Year, here are several US developments companies ought to know:

California Enacts First Employee Data Reporting Law

On September  30, California Gov. Gavin Newsom signed Senate Bill 973, Sen. Hannah-Beth Jackson’s bill relating to annual reporting of employee pay data. SB 973 requires private employers with 100 or more employees to report employee pay data to the Department of Fair Employment and Housing (DFEH) by March 31, 2021, and annually thereafter, for specified job categories by gender, race and ethnicity. California will be the first state to require employers to submit such employee data.

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Continue Reading US Pay Equity and Transparency Developments: What You Need to Know Going Into 2021

We are excited to invite you to our virtual Annual California Employer Update on Tuesday, December 8, 2020, from 1:00 – 2:15 PM PT.

“Quick Hits: California’s Top 10 & What You Need To Know In 2021” is designed to ensure that in-house counsel are up to speed on what changed in 2020 and prepared…

As predicted, on September 30, 2020, California Governor Newsom signed SB 973 into law. SB 973 requires private employers with 100 or more employees to report pay data to the Department of Fair Employment and Housing by March 31, 2021, and by March 31 each year thereafter, for specified job categories by gender, race, and…

On September 4, 2020, the California Legislature passed Senator Hannah-Beth Jackson’s bill relating to annual reporting of pay data (Senate Bill 973). If Governor Newsom signs the bill, as expected, SB 973 would require private employers with 100 or more employees to report pay data to the Department of Fair Employment and Housing…