The Uncomfortable Questions You Should Be Asking about Pay Equity

How much money do you make? Are you paid fairly compared to the other people you work alongside? Do you have any idea if you’re paid fairly? How much does the head of your organization make? Do you care? Does he or she care about whether your pay is fair?

For most of us, those are uncomfortable questions. Like politics and religion, asking someone how much they earn is, at best, considered impolite dinner conversation and at worst, potential grounds for class warfare. But at a time when lavish executive pay and gender inequity in the workplace dominate the headlines, these questions have become increasingly relevant to the national dialog. According to a New York Times/CBS News poll released in June, 66% of Americans feel that the distribution of money and wealth in this country is unfair and should be more evenly distributed. Half of all people surveyed said they were in favor of limiting the amount of money earned by top executives at large corporations.

“We are highly attuned to things we think are unfair,” says Matthew Bidwell, professor of management at Wharton. “As workers, we look at the ratio of what we’re putting in, versus what we’re getting out, and we compare that to the ratio of what other people are putting in and getting out…. [It’s only] natural to think: Is this fair?”

Some chief executives have recently come to the conclusion that their company’s pay structures aren’t fair and have taken steps to address imbalances. In April, for instance, Marc Benioff, the CEO of Salesforce, said he was reviewing employee salaries at his cloud-based software company to ensure male and female workers are paid fairly and have equal opportunities for advancement. Also that month Ellen Pao, interim CEO of Reddit, announced the social-media site would no longer negotiate salaries with prospective hires. Citing research indicating that men tend to negotiate harder than women and that women are often penalized when they do negotiate, Pao says her new policy is a way to level the playing field for female job candidates. Meanwhile Dan Price, the head of a small credit card processing firm in Seattle, announced that he planned to raise the salary of everyone at the company to a minimum of $70,000 over the next three years.

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