Using DEI Metrics to Assess Pay Equity

It is not enough today to simply look at pay equity across the board or just by department or title because you will miss the real insights about pay inequity if you are not utilizing DEI metrics. We worked with this company to address market gaps at a company level but also at a department, gender and ethnicity level. We also helped identify what market was, which was critical for employee communications.

When reviewing salaries within the marketing team, for example, it looked like female employees were getting paid more. However, as we drilled down into the data we saw a gap: the average level for women was 4.5 and for men it was 3.2, but on average men were receiving 15% of the overall pool. What had triggered this inequity? It turned out that on negotiating salary for equity tradeoff discussions the male candidates were far more aggressive during the final offer stages, especially with equity versus women.

One of the largest insights turned into an actionable pay equity take-away: the client has now implemented standard equity ranges that are non-negotiable unless pre-identified as a specialized role.

In addition to setting a compensation strategy, our client’s recruitment team used the departmental breakdown in their new hire requisition kick-off meetings with hiring managers. By integrating DEI metrics such as gender gap and ethnicity analysis into these meetings, the head of recruiting drove direct change in how the teams sourced candidates, creating much more precision on role level, gender and ethnic category.