September 17, 2019
Gender pay inequality shows little sign of ending soon (the Women’s Policy Research group says it will take until 2059 before women earn as much as men for equal work), but the new Ms. Monopoly® game by Hasbro is at least bringing the issue into the spotlight.
The game is controversial, to say the least. But as supporters and critics continue to weigh in on the merits of this variation on the classic Monopoly® board game, that controversy should help raise awareness of the problem for a new generation. Is this much ado about nothing? Is the gender pay gap really that serious? Yes! Read on to learn why this issue matters and what can be done about it.
What is the “Gender Pay Gap”
The gender pay gap is the reality that, on average, women typically earn significantly less than men when performing comparable jobs. What is “significantly less”? Nearly 20% less. According to the Bureau of Labor Statistics, “in 2016, women who were full-time wage and salary workers had median usual weekly earnings that were 82 percent of those of male full-time wage and salary workers.” While the gap has narrowed since 1979, when “women’s earnings were 62 percent of men’s,” the BLS adds that “since 2004, the women’s-to-men’s earnings ratio has remained in the 80 to 83 percent range.” In fact, the gap in 2016 was slightly wider than in 2012 and 2015. Small fluctuations, up and down, remain the norm at a time when significant progress seems to be desperately needed.
Earlier findings by the BLS in their Women’s Earnings and Employment by Industry report showed women’s median weekly earnings trailing men’s median weekly earnings in all 13 reporting industries and in 104 of 108 reported occupations. And while the U.S. is not the only country facing this issue, it is among the worst, ranking 49th for gender pay equality according to the World Economic Forum!
History of the Gender Pay Imbalance Problem and Efforts to Fix It
Gender pay inequity has a long and dubious history. Unfortunately, so do efforts to address the problem. The Equal Pay Act was signed into law by John F. Kennedy in June of 1963 amending the Fair Labor Standards Act. The Equal Pay Act was designed to help abolish wage disparity based on gender. Clearly, the Act has failed to live up to its intent. Likewise, the Lilly Ledbetter Fair Pay Act of 2009, which states that the 180-day statute of limitations for filing an equal-pay discrimination lawsuit resets with each new paycheck, has not had a noticeable impact on the underlying problem of gender pay imbalance.
So, with federal (and state) regulations unable to close the gap decade after decade, what can be done? The answer most likely falls not on the shoulders of Ms. Monopoly, but rather on corporate employers who understand the risks of inaction and the benefits of gender pay equity.
Corporate Solutions
At the corporate level, inaction could place employers at risk for regulatory audits and lawsuits that might prove financially devastating. What’s more, perception is key as workers clearly care about this issue! According to a Randstad US survey, 78% reported wanting a workplace where people are treated equally. Four in five female respondents indicated they would switch employers if they felt another company had greater gender equality. More than half (53%) of employees believe unequal pay is the top factor impacting gender inequality. And in a tight labor market when it can take months to fill an open position, every competitive advantage matters when attracting and retaining talent.
Certain employers are demonstrating they want to be part of the solution. Salesforce, for example, spent $3 million to close the gender pay gap in just one year. They then spent another $3 million to close pay gaps of other companies they acquired. On the larger scale, according to a recent Towers Watson Survey, 64% of responding employers plan to take, or are considering taking, action on compensation programs, while 36% say they are already addressing pay gap issues.
Unfortunately, the opposite corporate stance is more common. Most companies tend to maintain the status quo despite the costs (financial and reputational) of gender pay discrimination lawsuits.
To avoid these risks, I recommend companies start with an annual Discrimination Analysis and a gender pay Equity Analysis, assessing pay between males and females in the workplace. Compare within job titles and look for similar skills, effort, and responsibilities. Be sure to document previous related experience to the job currently held as well as how long workers have been in their current jobs. Examine also the last two to three years of performance ratings. Look for large pay gaps that should be closed, and then design and implement a plan to close those pay gaps. Taking these initiatives will help ensure fairness and compliance and should help minimize the risks of legal actions.
Bottom Line:
Hasbro’s Ms. Monopoly game won’t close the gender pay gap issue – that falls squarely on the shoulders of legislators and employers – but perhaps the game will help our youth understand the persistent gender pay equality issue and take the initiative to correct it.
If you don’t believe your company is in a good position to close the gender pay gap or defend against gender pay discrimination claims, we can help. Contact Total Rewards Solutions today at 317.589.8529.
Cassandra Faurote
About Total Reward Solutions:
Total Reward Solutions is your trusted partner for compensation services. Led by Cassandra Faurote, professionally certified Compensation and Human Resources expert and author of the book Compensation Sense 101, Total Reward Solutions offers a broad range of compensation and total rewards consulting services to help your organization attract top talent, motivate employees and retain top performers. We can partner with you on a project basis, on retainer, or as your total outsourced solutions provider for compensation services.
Call us today at 317.589.8529 to discuss how we can help your organization develop and implement competitive and effective compensation and total reward programs.