The gender wage gap remains a critical topic in 2021.
When examining the median salary between men and women, women were found to make 81 cents for each dollar made by men. That’s according to Payscale’s report, “The State of the Gender Pay Gap 2020.”
“In other words, the median salary for men is roughly 19 percent higher than the median salary for women,” the report said. Payscale also found that, when taking into account “all compensable factors such as experience, industry and job level,” a gap between men and women exists as well, with women making 98 cents for each dollar made by men.
Companies must not only try to rectify any pay discrepancies that might exist within their ranks. It’s also important to provide clarity around pay so that team members have context for such a critical matter.
Maggie Mannion, People Operations Lead at Ribbon, said that twice-a-year compensation audits are just one way that the real estate tech company keeps the matter under a scrutinous scope.
Meanwhile, Remy Greeno, VP of finance & people operations at andros, said that the organization underwent a “salary level exercise” last year to find and subsequently address potential pay gaps at the healthtech organization.
“Moving forward, we will evaluate our salary levels on an annual basis to ensure we are maintaining our philosophy to pay employees equitably,” Greeno said.
People Operations Lead Maggie Mannion said that Ribbon adjusted the frequency of merit-based increases to better ensure compensation moved in tandem with respective employee growth. “We adjusted our promotion and merit increase cycles from bi-annual to monthly to ensure that people are being rewarded in real time,” Mannion said.
What steps have you taken to understand and address any wage gaps that may have existed in your company?
Ribbon runs twice-annual compensation reviews. We audit everyone’s compensation (base, equity, bonus) to ensure that comp is market-driven and equitable. Every compensation decision must be justified according to defined processes and rubrics.
We partner with experts, OpenComp, to run these audits. We build leveling frameworks for each team, and each team member is paid at least the market rate for their role. We use three salary surveys to understand market rates. Any variances in pay must be for an objective job-based reason (e.g. experience, exceptional performance). After making market and merit adjustments, we re-audit compensation to make sure that every decision can be rigorously justified and to correct any gaps. Comp decisions for new hires follow the same process. To ensure fair pay, Ribbon does not negotiate. Every offer is our best offer.
When it comes to determining raises, how do you ensure the process is transparent and unbiased?
Merit increases happen on a monthly cycle. We have a clear process for merit increases, which is based on the process I described above. Every merit increase must be based on two factors:
objective job-based reasons (e.g. performance) and market data.
People managers submit a request to people operations and our founders to make a merit increase. They must demonstrate a few examples of how a person is consistently outperforming and has earned an increase. They must also confirm that they have holistically considered their team for an increase.
If the merit increase is approved, we then apply a formula to market data to determine the amount of the increase. We apply the same formula to all increases to ensure consistency. Merit increases can be submitted on a monthly basis. Every team member’s compensation is reviewed every six months to ensure fairness.
Every compensation decision must be justified according to defined processes and rubrics.”
What goals or metrics do you have in place to track your progress toward pay equity and hold your company accountable?
Our goal is 100 percent fair pay. We consider an employee to be fairly paid when their pay is market-driven and justified relative to peers in same or similar roles. Any variance in pay must follow our rubrics and be for an objective job-based reason.
We believe that Ribbon has 100 percent fair pay. We hold ourselves accountable in the following ways: We run a bi-annual compensation audit (in Q2 and Q4) to ensure that everyone is paid fairly and competitively. We intentionally look for pay gaps; if one is identified, we will correct it.
In recruiting, we align on leveling and compensation before opening the role. All offers are “best and final,” meaning that we do not negotiate new hire offers. This helps to protect against a pay gap and is a strong signal to our team of Ribbon’s commitment to fair pay.
Finally, we publish our processes in our internal wiki and host occasional information sessions to make sure everyone understands how their compensation is determined. Team members are encouraged to ask questions about their compensation and how to grow with the company.
At andros, a recently created “compensation philosophy” helps inform relevant decisions at the organization, according to VP of Finance & People Operations Remy Greeno. “Our compensation philosophy and resulting salary bands continue to be our North Star to ensure that salaries continue to be equitable across our organization,” Greeno said.
What steps have you taken to understand and address any wage gaps that may have existed in your company?
Last year, we developed a compensation philosophy and corresponding job and salary levels to ensure we are paying employees equitably and competitively against the market as we continue to scale as a company, as well as identify any inequities so we can take action. After completing the salary level exercise, we were able to identify wage gaps within the organization and create an action plan to address identified inequities. Moving forward, we will evaluate our salary levels on an annual basis to ensure we are maintaining our philosophy to pay employees equitably.
When it comes to determining raises, how do you ensure the process is transparent and unbiased?
Our annual review process measures our employee’s performance against their role’s job description, OKRs and company values to ensure that each employee is being evaluated equitably across the organization. Our people operations team works very closely with finance and our managers to then ensure we’re using those performance reviews to determine appropriate raises.
For raises related to promotions or increases in scope of responsibility, we work closely with managers to ensure we have determined the right level and relevant salary band for that new role, and that data we collect informs our recommended raise. As the people operations team, it is our responsibility to empower and coach managers to leverage the tools and processes we have in place to inform these salary decisions to remove any bias. We rely on data and consistent, uniform ways of measuring performance across the company so we are not relying on personal biases to impact our decisions.
We rely on data and consistent, uniform ways of measuring performance across the company.”
What goals or metrics do you have in place to track your progress toward pay equity and hold your company accountable?
We will continue to revise and update these salary bands to ensure that they continue to align with the market, as well as work closely with our management team to ensure they understand the importance of hiring and giving raises at equitable salary levels. As we continue to scale and evaluate our salary levels, we will also begin leveraging comparison ratio as a key metric to evaluate our pay equity progress.
