Best Practices for Pay Equity External Communications and Gender Pay Gap Disclosure | Part 2

Communicating your goals

When writing about your pay equity goals, it’s probably not enough to just provide a bulleted list. Readers want to understand what’s motivating your goals. Is there a specific situation that your organization needs to remedy? Or do you just have a general commitment to fairness?

The excerpt below comes from a five-page pay equity statement from the insurance and asset management company AXA, and it’s an excellent example of how to clearly communicate what your company is striving for. You can see that the first paragraph lays out a general motivation for AXA’s goals, and then the second paragraph talks about a specific situation that the goals will address: a gender imbalance among higher-paying positions.

The statement uses many best practices. It’s honest in admitting a pay gap and talking about where it comes from. The goals are focused on action and impact, and some are associated with measurable outcomes (e.g., 35% women in senior management). While it doesn’t quote them directly, the document summarizes specific policies. And it’s easy to understand, with straightforward language and each goal given its own short paragraph.

Communicating your gender pay gap (unadjusted pay gap)

The unadjusted pay gap can be a good metric to use in external communications. It’s straightforward to generate, with no regression analysis required (unlike the adjusted pay gap). It’s also easy to understand. And it’s a helpful way to start talking about the broader systemic issues related to diversity, equity, and inclusion (DEI), as we saw in the previous example from AXA.

In fact, let’s take a look at an earlier page of the same AXA report that shows the (unadjusted) gender pay gap. Note how it breaks the pay gap down into quartiles, showing that the 25% of lowest earners were mostly women and the 50% of highest earners mostly men. These visualizations make the information easy to understand.

A pay gap of any kind is never great news. But the example below, from the insurance provider Allianz UK, shows how this news can be acknowledged and contextualized. This graphic plainly states the company’s gender pay gap. But it also uses historical data (including an extra metric, difference in median hourly earnings) to show measurable progress towards closing the gap. This is an excellent use of visualization to convey a complex concept in very few words.

Communicating your equal pay gap (adjusted pay gap)

The equal (adjusted) pay gap is derived through regression analysis, which accounts for all of the factors that might influence pay. Most of the time, the equal pay gap is the key metric, the number that your company is focused on driving down to zero. And sometimes it’s possible to provide that measurement without too much risk of legal exposure. This brings your readers right into the heart of your pay equity journey.

This is just what Generali, an insurance and asset management provider based in Italy, has done in the example below, taken from a 130-page public report. Note that this section tells a story about the origin of its pay equity efforts and specific further actions taken. Also, while the distinction between the equal pay gap and overall gender pay gap (adjusted vs. unadjusted) is not intuitive, Generali provides straightforward definitions of those terms. And the document offers an eye-catching graphic so readers can quickly understand key pay equity metrics.

Communicating about your journey

A journey makes for a good story. So if your pay equity journey hits some unexpected bumps, you shouldn’t necessarily try to minimize them. Instead, you can make those obstacles part of a compelling story arc.

The text below, from the software company Adobe’s web page on pay parity, is some good storytelling. It introduces the idea of pay parity, presents a challenge the company encountered on its journey, then talks about the specific steps taken to overcome it. This document also makes many other smart moves. It talks about specific practices that have been implemented, including more equitable review practices and pay transparency measures. It highlights a concrete accomplishment: as the graphics show, the company has reached pay parity. It also includes some supplemental data about its unadjusted pay gap of 1.2%.

As we mentioned in Part 1, you can also tell a story that focuses on a specific experience or situation. This is what the software and services company Amdocs does in their CSR document on diversity and inclusion. This text starts out by framing the company’s values, then zooms in to focus on the experience of a specific employee in the context of the company’s diversity journey.

Communicating in pay equity statements

Pay equity statements are something we’re asked about quite often, so we’re taking a moment to talk about their special features. As we mentioned in Part 1, the objective of a pay equity statement is to demonstrate that the company considers pay equity important and is taking meaningful, proactive action. These statements are usually relatively short, only a page or two. In addition to communicating pay equity policy, they can:

• list specific supporting policies and practices, 
• summarize the company’s compensation philosophy, 
• reference pay equity analysis results, 
• talk about what the organization has already achieved, 
• and more!

Examples of pay equity statements

To show some of the range of this highly customizable document, we’ll go through a few examples. Below, we have a short and sweet one from New York Life. It states a commitment to pay equity, quotes the company’s DEI policy that also covers pay, and lists two supporting practices. That’s it!

You can also choose to ground your pay equity statement in the relevant legal framework. (For more information on what laws apply in your part of the world, check out our local resources page.) The statement below by VIAVI Solutions specifically references the Equal Pay Act and the Civil Rights Act. Then the following paragraphs each list one or more values and policies that support its commitment to pay equity.

As an example of a statement that includes pay gap data, we have the below from Prudential. After discussing general practices, the statement includes a clear graphic that shows what the company has done to improve pay equity for incoming and current employees. The company has managed to achieve very slim pay gaps based on both gender and race, which are included in the report.

We hope you’ve found these examples illuminating!

How PayAnalytics can help

When you set pay equity goals, PayAnalytics can help you achieve them. Our software solution can measure your pay gaps and suggest targeted raises to close them most efficiently. Our Compensation Assistant provides salary suggestions for new hires and promotions, helping to make sure that the pay gap never re-opens.

Our user-friendly visualizations help you see your salary structure at a glance and drill down for more detail. This helps organizational decision-makers better understand your pay equity issues – and the visualizations also work great in your ESG reports!

Our Workforce Analytics feature can also help build the foundation for your ESG communications. This feature lets you look at metrics associated with DEI in your organization, like current workforce diversity and diversity in hiring and attrition.