Open Pay Vs Gender/Socioeconomic Pay Gap
Open - or transparent - pay in the organisation is still something that’s rare on the UK or indeed global scale. Yet it has significant benefits. Erasing, or minimising, gender and the socioeconomic pay gap is definitely one of them. What dynamics are at play to allow for this to happen?
Firstly, in an open pay environment anything that appears unfair, such as a disparity between the salary of a man and a woman occupying similar positions will quickly be corrected. It will become glaringly obvious a lack of fairness exists and any sensible HR manager will quickly take action so as not to earn their company a poor reputation. The woman in question is also very likely to fight for her rights to equal pay.
On top of this, in a transparent environment any biases of the management, for example in favour of white people, or people with higher education, will be scrutinised by the rest of the company. Unfortunately biases - often unconscious - exist everywhere. The key is to be aware of the bias-prone nature of the human mind and to create working cultures that expose and deal with them instead of hiding them. Transparency empowers both those traditionally underprivileged and those with a privilege, be it racial, socioeconomic, educational, etc to stand up for fairness and equality.
Also, in an open pay environment, it’s hard for different variants of salary gaps between individuals performing the same jobs to slowly evolve over time. Often pay gaps exist as some individuals are more keen and capable to argue for higher salaries. Moreover, some people are more skilled in playing political games - which tend to prevail in secretive cultures - in order to earn their boss’s favour and receive a paid upgrade.
Finally, the difference between the highest and lowest paid employees of the company is likely to be way less significant. As demonstrated by numerous corporate scandals unveiled by the press in recent years, the senior vs junior executive pay gap is also something extremely concerning in many large companies these days.
On the whole, open pay seems to be a possible solution to the gender and socioeconomic pay gap that exists in many companies today. It’s not without challenges to adopt - it requires courage and a mindset of being prepared to go against the status quo on behalf of the management. Once implemented though it definitely helps to bring about and sustain a culture where openly fighting biases and creating parity between individuals of different genders and backgrounds are amongst important values.
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