Dive Brief:
- An ADP study shows that total compensation, including variable pay such as bonuses, can contribute to the gender pay gap, reports the HR Daily Advisor. The payroll firm’s study found a 28% gap in variable pay between men and women.
- The ADP Research Institute studied 11,000 employees during a six-year period. The employees were of similar ages and had the same start dates and base salaries. The pay discrepancy between men and women was in variable pay, specifically annual bonuses.
- The EEOC noted in its new EEO-1 reporting requirements that the percentage of compensation beyond base pay has risen significantly during the past several years, the report said.
Dive Insight:
Discrepancies remain in base pay rates. However, the ADP study makes the case for employers also examining total compensation to uncover wage gaps in variable pay.
HR must work with managers to ensure that bonuses are awarded without bias. That includes differences in pay due to 'additional duties' that may not actually be substantial enough for a raise under the Equal Pay Act.
Observers have commented on the existence of the "manager divide," understood as a comparatively low number of women in managerial positions at U.S. companies compared to men after a certain age. It coincides with the age range in which many women have children, which many cite as a factor impacting their earnings and potential for career advancement.
Correcting this problem takes more than transparency about who earns what; women need to be considered for leadership positions, be they mid-level managerial roles or seats in the C-suite. The number of female CEOs is at a particularly embarrassing low across top companies, and the business world is rife with examples of those who don't practice what they preach when it comes to inclusivity.
