Presentation at the 2017 CUPA Conference in San Diego. A deep dive into a pay equity study, including project structure, objectives and diagnostic tools. The presentation shows how to conduct a study and what the can tell you about your HR programs.

1. PAY EQUITY STUDIES FOR THE
21ST CENTURY
Presented by:
Carla Anderson, Sr. Associate Director of Compensation and Employment, Pepperdine University
Amy Heinze, Director, Conduent
James Sillery, Principal, Conduent
September 18, 2017

2. Session Rules of Etiquette
• Please silence your cell phone.
• If you must leave the session early, please do so as discreetly as
possible.
• Please avoid side conversation during the session unless encouraged
to engage with your peers.
Thank you for your cooperation!

3. Introduction
Pay equity and diversity
have been topics of
interest in Higher
Education for over 50
years
In this presentation, we
will discuss how a pay
equity study can provide
insight into how your pay
programs work and how
they can be improved

4. Agenda
• Today we will cover the three primary reasons for considering a Pay
Equity study at your institution
oInformation: How do your institution’s pay administration programs support
diversity, equity and inclusion?
oInsight: What contributes to pay variances: hiring practices, pay policies or
workforce demographics?
oImprovement: How do we use what we have learned to improve pay
effectiveness and build engagement?

5. Objectives
• In this presentation, we will:
oProvide participants with an understanding of the importance of building
effective pay administration policies and programs that support diversity,
equity and inclusion
oDiscuss the Pay Equity Study as a core exercise in this pursuit to include
processes and strategies for conducting a Pay Equity Study, compliance
implications, and insights gained from these studies
oProvide insight into how these studies can help HR professionals better
address the needs of the institution and that can better serve the needs of a
diverse, multigenerational workforce

6. Information

7. Why Pay Equity?
• Pay Equity not just a compliance
issue
• It sits at the center of achieving
effective human resource
management and workforce
engagement
• Driving forces include pay
transparency, effective pay
administration, meeting the needs
of a diverse workforce and
regulatory compliance

8. Regulatory Compliance
• Equal Employment
Opportunity Commission
• Internal Revenue Service
• Office of Federal Contract
Compliance Programs
• U. S. Department of Labor
• U. S. Securities and
Exchange Commission
• Individual State
Regulations

9. Diversity in the Workplace
• Today’s workforce is diverse and
multi-generational, with
differences in aspirations and
perceived values
• An institution’s success and
competitiveness depends upon its
ability to embrace diversity and
realize the benefits
• Employing a diverse workforce
results in a greater variety of
solutions to problems, sourcing,
and allocation of resources

10. Transparency
Guiding Principles - Institutions should:
• Make salary ranges for all job titles public
and available to all job applicants.
• Develop and implement policies which
prohibit pay secrecy and eliminate
penalties for discussing pay.
• Consider inclusive evaluation processes
when making pay raise and promotion
decisions, and ensure that these decisions
are justifiable and well documented.

11. Pay Administration
Guiding Principles:
• Conduct pay equity studies to evaluate
whether their compensation practices
promote gender pay equity
• Include analyses of pay by job title, pay
band, or department to identify gender-
based pay disparities
• Guide institutions through open-ended
questions to determine if their
compensation practices promote pay equity
• Accountability for completing self-audits and
working toward remediating any gender pay
disparities identified during this process

12. Pay Administration
Guiding Principles:
• Compensation systems should be evaluated from a gender and/or race
equity perspective which goes beyond the concept of “equal pay for equal
work”
• The goal should be to understand what constitutes fair pay for all workers
• Employers should use a standardized methodology to assess the internal
and external value of each position in their organization
• Pay rates should reflect the value of every position regardless of the type
of work or job title

13. Getting Started
• Covered population
oStaff or Faculty
• Gender
oWhite Male vs. Male
• Ethnicity
oNational vs. local influences
• Compensable Factors
oStaff: Education, Experience/Years Service, Role/Position, Market/Salary
Grade
oFaculty: Rank, Tenure, Location (School), or Education

14. Insight

15. Salary Administration Policies
• Start with an analysis of the
policies and procedures
that guide pay decisions
• This analysis provides
insight into the degree that
differences between and/or
inconsistent of application
across institutions can
contribute to actual or
perceived variances in pay
practices

16. Demographics
• Look at how your workforce is distributed
• A comparison of the institution’s breakouts to data found in reports published in
national databases, e.g., the National Center for Education Statistics, can point to the
potential influence or impact of differences in staffing levels on the findings and
conclusions of the study
Percentage distribution of full-time
instructional faculty in degree-granting
postsecondary institutions, by
academic rank, selected race/ethnicity,
and sex

17. Demographics
• An analysis based on defining
Groupings as “female or minority
dominated” can result in an
understanding of the
gender/ethnicity mix at the
institution
oGenerally, groupings with 70% or
more female or minority
incumbents are considered
“dominated” while groupings of
31% - 69% are considered
“balanced” $0.0
$50.0
$100.0
$150.0
$200.0
$250.0
$300.0
$350.0
$400.0
0 1 2 3 4 5 6 7 8
BaseSalary
Salary Grade
Distribution of Salaries by Grade and Gender
Male
Female

18. Preliminary Analysis
• A preliminary analysis of pay data provides insight into the degree that
the relative sizes of comparison groups can influence perceived
differences in pay and indicate the need for deeper analysis

19. Statistical Analysis
• The statistical analysis provides insight into variance in comparison to White
Males and the degree to which compensable factors may explain that variance
-11.5%
-10.9%
-1.9%
0.6%
-1.1%
-15.3%
-12.8%
-7.0%
-4.0%
-3.5%
-12.0%
-11.8%
-4.8%
-3.1%
-4.1%
-18.0% -16.0% -14.0% -12.0% -10.0% -8.0% -6.0% -4.0% -2.0% 0.0% 2.0%
Department A
Women
Asian
URM
Demography Only
Demography, Education
Demography, Education, Years of Service
Demography, Education, Years of Service,
Functional Area
Demography, Education, Years of Service,
Functional Area, Mgr/IC

20. Remedial Actions
• A deeper dive should be conducted for any variance that are not
explained in the statistical analysis
• Remedial actions are based on a holistic assessment of study findings
and may include:
oChanges to hiring policies
oChanges to salary administration programs
oChanges to policies that guide salary decisions
oIndividual and/or group salary actions

21. Improvement

22. Pay Policies and Procedures
• Our study showed that the practice of setting compensation policies
was decentralized, with institutions determining the policies that will
be in place at their location
• In some institutions, policies were robust while in others, they were
more informal
• Creating dialogue around setting pay policies was the first step in
creating cross-institution consistency.
Question: How many of you feel that you are in a similar situation at
your institutions?

23. Internal/External Equity
• Our study created real insight into the balance that exists across
positions with regard to value of jobs based on market factors and
internal relationships.
Question: What drives job value in your organization, market, internal
equity or both?

24. Compliance
• Our study created a better dialogue between human resources and
legal regarding steps that we can be taking to be proactive with
regard to regulatory compliance.
Question: How frequently do you interact with your legal group on
pay equity issues?

25. Jobs and Career
• Our study helped to create a more holistic view of how jobs work in
our organization; how people progress within a position as well as
from current position to a new position.
Question: Do your pay programs consider future career potential
along with the current opportunity provided to an employee?

26. Effective Salary Administration
• Our study drove changes in the way that we administer our pay
programs that created greater efficiency and transparency.
Question: How does the current state of your salary administration
program compare to the desired state?

27. Takeaways
• Take a holistic approach
• Look beyond the statistics
• Consider how policies and processes impact pay practices
• Be transparent with you findings
• Seek to continuously improve

29. Thank You
Carla Anderson, Pepperdine University
carla.anderson@pepperdine.edu
Amy Heinze, Conduent
Amy.heinze@conduent.com
James Sillery, Principal, Conduent
James.sillery@conduent.com
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