Pay Equity and DE&I 2020: How Are We Doing?

October 28, 2020 - Scottsdale, AZ


Pay Equity and DE&I 2020: How Are We Doing?

Survey Provides Comprehensive Review of Organizations’ Practices and Intentions

October 28, 2020 — Sixty percent of organizations are addressing pay equity in their workplaces, and 70% are taking action on diversity, equity and inclusion (DE&I), according to the “Workplace Equity Study” conducted by WorldatWork in partnership with Korn Ferry. The comprehensive survey provides a window into how organizations are addressing, and if they plan to address, pay equity initiatives and DE&I initiatives, including goals, analysis methodologies/frequency, adjustments, transparency/communications, metrics, and more. A pay equity practices survey fielded in January 2019 provides a benchmark for pay equity questions posed in this current survey (Journalists: contact for copies of the 2019 and 2020 surveys.)

Key pay equity findings:
Uptick in frequency of compensation analyses. While the number of organizations ‘taking action on pay equity’ (60%) vs. it’s ‘on our radar’ (33%) vs. it’s ‘not on our radar’ (7%) mirrors findings from 18 months ago, there’s been an increase in the number of organizations conducting compensation analyses ‘once per year or more frequently’ (73% in 2020 vs. 65% in 2019).

Self-grading. Nearly a third (31%) of organizations give themselves high marks for pay equity management, with 56% indicating they are ‘mostly equitable, some pay discrepancies exist.’

Transparency. Sixteen percent of organizations report having ‘high’ or ‘full’ transparency in pay equity communications, while 65% report having ‘some’ or ‘moderate.’ Nineteen percent have no transparency at all.

“Even in light of the current pandemic environment we are seeing over 80% of organizations continuing or accelerating their pay equity assessment processes indicating that this work is a top priority in most organizations,” says Tom McMullen, a Senior Client Partner at Korn Ferry. “There are obvious engagement, credibility and reputation benefits in organizations focusing on pay equity management. In addition, there is a strong likelihood of continued regulatory focus and increasing calls on transparency in pay equity reporting. And organizations that have not yet taken action should be on alert.”

Key DE&I findings:

Prioritizing DE&I. Most organizations are either taking action (70%) or have DE&I on their radar (23%).

Reasons why. Among the top drivers inducing organizations to commit to DE&I initiatives are ‘to build/maintain a culture of trust,’ ‘to remove bias against protected classes,’ and ‘to align our actions with employee expectations.’

Scorecard challenges. Half of organizations have no/limited organization scorecard metrics in place, 28% focus on lagging indicators of success and 17% focus on leading indicators.

“The social justice efforts in 2020 were clearly a wake-up call to organizations. We see that nearly every organization is either taking action or has DE&I on their radar,” says Scott Cawood, CEO, WorldatWork. “This shows momentum to close the pay gap and move towards more diversity and inclusion in the coming years. However, it is quite alarming, in this current environment, that 7% of respondents say their organizations do not have DE&I on their radar. These organizations are putting themselves at risk of criticism, or worse, and making themselves less appealing to prospective employees.”

About the Study
WorldatWork, in partnership with Korn Ferry, invited its broader membership and customer base to participate in an electronic survey on pay and workplace equity. Email invitations were sent directly to participants on 9/09/2020 and results were collected over a 22-day period. A total of 964 responses were received, representing organizations of different sizes and across multiple industries. The survey has a 3% overall margin of error at a confidence level of 95%. Sample sizes vary by question.

About WorldatWork
WorldatWork is the leading nonprofit professional association in compensation and Total Rewards. We serve those who design and deliver Total Rewards programs to cultivate engaged, effective workforces that power thriving organizations. We accomplish this through education and certification; idea exchange; knowledge creation; information sharing; research; advocacy; and affiliation and networking. Founded in the United States in 1955, today WorldatWork serves Total Rewards professionals throughout the world working in organizations of all sizes and structures.

About Korn Ferry
Korn Ferry is a global organizational consulting firm. We work with clients to design their organizational structures, roles, and responsibilities. We help them hire the right people and advise them on how to reward, develop and motivate their workforce. And, we help professionals navigate and advance their careers.

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