Research indicates that pay transparency does result in smaller pay gaps. At the very least, if employees are aware of pay discrepancies in the company, women and people of color can confidently negotiate for higher salaries than those offered. But most companies keep salary information secret and are not transparent. That is why the step taken by employees at Google is so important—they took matters into their own hands to create transparency.
Daisuke Wakabayashi of the New York Times reports that in 2015, a female engineer at Google created a self-reported salary spreadsheet that employees are still using. In 2017, twelve hundred United States Google employees posted their salary and bonus information to this spreadsheet, which shows that female employees are paid less than male staff members in comparable jobs at most levels. The spreadsheet does not cover all levels and is admittedly incomplete. Nonetheless, since Google’s board voted against making pay transparent for women’s and men’s salaries, and Google is in a court battle with the United States Department of Labor because it is refusing to hand over data as part of a routine audit of its pay practices, the self-reported data is the only source of transparency for Google employees. Without the spreadsheet, Google would not be held accountable at all.
Now, more than ever, employees need to self-organize to collect salary data and make it transparent to expose pay gaps. Why? Because, as Claire Cain Miller of the New York Times reports, the Trump administration just reversed a regulation that the Obama administration put into place to address the pay gap. Miller explains that the Obama administration regulation, which was about to take effect, would have “required companies to report how much they paid people, along with their sex and race.” Europe and Britain require companies to report this information, but now, under the Trump administration, we do not. Without this pressure from the Federal government, companies have no incentive to close the pay gaps and will continue to keep salary information secret and, accordingly, to hide discrimination and avoid accountability.
Miller reports that, according to an analysis of the Bureau of Labor Statistics data by the Pew Research Center, we know the following general statistics about the pay gap in the United States:
- White women’s median hourly earnings are 82 percent of those of white men
- Asian women earn 87 percent of what white men earn
- Black women earn 65 percent of what white men earn
- Hispanic women earn 58 percent of what white men earn
- Black and Hispanic men earn less than white men, while Asian men outearn them
An example of the importance of transparency recently occurred in Britain at the BBC. Britain only recently implemented a new regulation requiring that companies report salary data. Steven Erlanger of the New York Times
explains that when the government forced the BBC to publish the salary ranges of its highest paid employees, the resulting report showed significant disparities.
An open letter signed by forty-two employees stated that the report confirmed a long-held suspicion that “women at the BBC are being paid less than men for the same work.” Until the data was made public, no confirmation of those suspicions was possible. Employees and the government are now pressuring the BBC to close this gender pay gap.
If your company does not make salary data public, you could consider following the example of the Google employees and organizing a way for employees to self-report so that people have some information available to them when it is time for them to negotiate for salary increases. I recommend that a group of people, including both women and men, get together to organize this collection of information. If the company finds out and is unhappy, a group is at less risk than an individual when taking steps that the company may find threatening.
The gender and race pay gaps will never close if we don’t take some steps to bring disparities to light. Let us know if you have been successful at creating pay transparency in your company.
Photo courtesy of businessforward
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