Gender Pay Gap

Welcome to the Get Pay Right podcast! This episode explores the gender pay gap: why it exists and persists, as well as the steps your organization can start taking today to close it.

Transcript

SPEAKERS

Kim Borman, Julie Murphy, Heather Bussing

Julie Murphy  00:07

Okay, go ahead, Julie. According to the US Department of Labor, women earn less than men in nearly all occupations and estimate that the pandemic has set women's participation in the labor force back more than 30 years. Here to share insights into this issue are two highly accomplished women who are well versed on the impact that the gender pay gap has on both companies and employees. I'd like to welcome Kim Borman, Executive Director of the Boston women's workforce Council, and employment Attorney Heather Bussing. Kim, can you share with us a bit about your background and the Boston women's workforce Council,

Kim Borman  00:47

I'm happy to thank you for the opportunity to lead. I'm the Executive Director, as you said of the Boston women's workforce Council, which is a private public partnership between the Mayor's Office of Boston and Greater Boston employers, we ask Greater Boston employers to take a pledge that they will examine their numbers, whether or not they have a wage gap, and then do something about it if they do. One of the other things that we do is they take a pledge to give us their data so that we can keep people accountable on a community basis. So we use software that makes everything confidential. But we are able to see, over time, the progress we've made on the gender wage gap.

Julie Murphy  01:39

Great, thank you so much. And Heather, please tell us about your background.

Heather Bussing  01:44

Hi, everyone. I'm Heather Bussing. I'm an California employment attorney. I've been doing this over 30 years. And I also spend a lot of time thinking and writing about HR technology and how it affects both work and law.

Julie Murphy  02:04

Great. Well, thank you both again, and Heather, I'd love to just dive right in. And I would love for you to define the gender wage gap and how long it is estimated that it will take to close.

02:18

The gender wage gap is simply the difference between what men make and what women make in the same roles. And you can also look at it in the aggregate across all roles. And so when you're looking at data, you want to make sure you know sort of what you're talking about. But in general, the World Economic Forum did really well they do research every year about about the pay gap. And in their 2020 report, which was based on before the pandemic, they were estimating that it would take 99.5 years. And a year later, in the middle of the pandemic, that number had increased 36 years due to the pandemic. So 136 years. If if we do what we're doing now, and it continues. Now, I think that probably has gone down a tiny bit in as people went back to work in the last year, and that data should be coming.

Julie Murphy  03:44

Wow, that's grim. Yeah. Oh, my gosh. So Can Can you talk about how the Boston women's workforce Council measures the raw gender wage gap, and how that differs from Equal pay for equal work.

04:01

So equal pay for equal work has been the law since 1963, which is Heather knows as a lawyer doesn't mean it's always followed. But it should be and people can, you know, they can be called by lawyers and told there you're not following it. The way that we look at it is the second way that Heather was talking about, which is a rod gender wage gap, meaning it's unadjusted. So it we, where you think of equal pay for equal work is sort of horizontal. In other words, are you paying people within the same job, the same wages, we look at it vertically. It's the total amount of what you're the average of what you're paying men versus what you're paying women. And then we also break it out into to race and to gender and race, but in terms of the total amount of men versus women in the Boston community We get the metrics on the gap was 30 cents, and that that gap is much larger than what we'll hear about tomorrow. Because it's national Equal Pay Day. Because that data even though the math is done the same way we do it is based on census data. And census data, as we all know is is you call people up on a survey, and you say to them, what you earned last year, and they kind of remember it they did they get a bonus, did they not? We take the data, right off our compact signers. So these people who make a pledge their payroll systems, so it's about as accurate as you can get. So unfortunately, we feel like our number is much more accurate than the national number.

Julie Murphy  05:45

Wow. Okay, even more grim cam. Fascinating, so. So Kim and Heather both really, but but Kim, first, what do you see as the key drivers of this gap?

06:01

The key drivers are that women and particularly women of color are not being promoted at the same rate as men. And that's really what it is because you can be paying people at the lower scale echelon of the sort of ladder, the same. But if none of these women are progressing up and getting to a higher level of pay, then you're never going to see that gap close, because the average is just going to be so great. You know, it's interesting, because labor economists said this year that we would see an artificial narrowing of the gap, because so many women from the lower ends of the scale had dropped off. In Boston, we didn't see that. In fact, the 30 cents is the same thing we saw when we did the metrics, or the measurement two years ago, in 2019. It's the same unfortunately. However, what it does show us if there's a silver lining is that Boston employers tried very, very hard to keep their workforces intact. In fact, we saw salaries across the board go up 12%. What we didn't see our promotions, there was there didn't seem to be a lot of difference there.

Julie Murphy  07:20

Interesting. So Heather, what thoughts do you have on some of the key drivers? I know, you and I have talked about the child as well?

07:29

Oh, exactly. I mean, I think at the core, the the issue is that biologically women have babies, women give birth, and, and that has created a division of labor, and our culture is very male centric, still. And so, you know, the men are in charge, and the women do the labor. And, and that's something that's changing, but the value and the understanding is lagging.

Julie Murphy  08:11

So Heather, how do you break this cycle?

08:17

I, I think making sure that, that there is child care that parents are treated equally, so that they can share in the responsibilities of picking the kids up from daycare or dropping them off at school or activities. I think I think that's the huge thing. And then the other thing is that organizations need to be more proactive, and and intentional about who they're recruiting and who they're preparing for promotion and who they're promoting.

Julie Murphy  09:00

Kim in terms of that, that upward mobility for female workers, we you know, what are what are some suggestions? Or how do we solve this problem? There are so few women still in the C suite. Right.

09:16

Heather's Heather's right. I mean, a lot of it has to do around childcare. There was a very interesting study put out by two professors from the University of California Berkeley. And they talked about the idea of women starting pretty much at the same salaries as men. And then as you can see, through the years, they earn less and they call it not so much a gap in pay but as a gap in responsibility. And so what's happening is women are not being given the same opportunities to manage large teams or take on big projects. Oftentimes because people Think all they won't want to do it because they have kids at home. So what when you say what? What can change that. So we had a lot of, we still have a lot of remote working. I mean, we're all remote today, there's something about that, that people have been trying to, you know, put it into their companies for years suddenly realize, guess what? Productivity doesn't go down. In fact, maybe it goes too high when people are have different schedules or are working from different places. And so if employers can stick with some of the changes that they put in place to basically survive, you will likely see more promotion of women, because now hopefully, the responsibilities will be shared among a team. And you'll be judged we hope on your productivity versus on your ability to, I don't know, stay later and chat with people after work. These are some of the things that the pandemic actually has offered us as opportunities.

11:06

Travel would be another one because we're not traveling as much. And that creates often much more stress on women.

11:16

Oh, definitely I, we saw something in particular. So we give away innovative initiative awards, it's one of our ways to get feedback to be honest with you from our compact signers, because they're all doing really great things. But they're so busy, we can't hear from them and practices. So the last time we gave away these awards, Mass General Hospital, one one and it was just like you're talking about whether it was leave it or not, even doctors have to do more than save lives to get promoted. So they have to do extra curricular things. And one of them is they call it grand rounds where you have to go, you have to be a visiting doctor elsewhere and be leading residents. And so you either have to go across the state, you have to go across the country, or sometimes you have to go across the ocean. And women were not applying for these because you would be away for up to six months at a time. And so suddenly, they decided, okay, we're going to do all of this remotely. And we'll do it with video. And they encouraged more women to apply this time. And they got about three times the number of women. And guess what they chose 10 of them and they're now up for promotion. So hey, are ways to make this work. You just have to, like think a little bit out of the box. But it's not even that out of the box, to be honest with you.

Julie Murphy  12:44

But right pandemic silver lining for sure. Yeah. It's funny when I had two sons, who are now both in high school, but when I initially had them, I was working at a nonprofit daycare was probably more cost more than my salary. Right? So I pivoted to consulting and working part time, when I re entered the workforce in a company, a tech company that was wonderful. But I reentered full time. My boss was a great female, she was 10 years younger than me. I felt like I had lost that that time. So

13:26

it happens all the time. And me know, hopefully it did hold you back. But you know, I'm sure it did.

Julie Murphy  13:35

Cause right, when you're the only you know, you're the oldest one I'm too young to add. I don't know, you know, you just have to have a good attitude about it. It's all worked out. But it was kind of an eye opener for me and realizing that some of the sacrifices you make in order to balance your personal life and your work life. Good quote, We all make for my guess. But it's

13:55

nice to come back to women bosses. I love working with women.

Julie Murphy  14:04

She was great. So yes, I've been very fortunate in my career with great female bosses. So Heather, let me ask you this in terms of what can a company do to analyze where they're at and where they need to get to? A pay equity analysis, I believe is something that a company should initiate. Can you talk a little bit about that and perhaps what my company see as the pros and the cons to doing such an analysis?

14:30

Well, you want to do it for compliance. And, and the data is out there. So you are expected to know you can't just say oh, we didn't look sorry. You know, that's that's not enough. And then the other thing about pay equity is every time someone quits, and every time you hire someone, you have a new situation and so it's Something that's really important to monitor, not just at certain times of the year, but on an ongoing basis. And one of the nice things about all of the data and technology that we that we have, and have figured out how to do interesting things with is now there are tools coming that, that make that analysis, pretty easy. But the first layer is you go and you figure out what people are making, and in the same job levels, and, you know, even titles. And when you see disparities, then you go and look at whether those gaps have some sort of legitimate business reason to justify them. So that if someone has a lot less experience, or someone has an advanced degree, or, you know, there, there may be valid reasons for paying one person a little bit more than another. Sometimes it's it completely inadvertent, which, you know, is a function of people coming in and negotiating a better deal coming in the door, and then the person who's been there 10 years with cost of living increases, doesn't make as much anymore. And this actually happens to men too. So, so pay equity is for everyone. So it, you know, it can be complicated. And my advice to, to people who are starting to do this analysis is to understand that the data is discoverable, you will have problems. It's everybody does it, it's the way it is. And so you the important thing is to come up with a plan and begin to implement it. And some states like Massachusetts, have a safe harbor period where if you can demonstrate that you are have a plan and are taking actual action to fix it, you you will be safe you you won't be liable, because the reality is that everybody has a problem, and everybody should be encouraged to fix it, not ignore it until they get caught.

Julie Murphy  17:33

Right. So Kim, I know that Boston women's workforce Council says if you don't see it, you can't change it. So are there any other ways that that you would recommend or have seen companies sort of illuminate the problem? Well,

17:52

we ask our compact signers and employers overall to do the math to it's a little bit different than Heather's math is actually except for the aggregating. It's pretty, it's simple math. Again, as I said, it's an average of what working men versus working women are earning at your company. It's an average of what white employees are earning versus employees of color. And then we also ask people to look at gender and race. And it's typically compared to white men, because they often are the people earning the most. It is not tough math, but it is something that people again, don't necessarily because then it's not a compliance factor. We are producing a wage gap calculator with the Mayor's Office of Boston, it should be done in two weeks, I'm hoping and there will be a link to it. And it's not just for our compact signers, you'll still have to aggregate okay, what all the men earn at my company, but we're going it's almost like a it's a calculator like a retirement calculator. Some banks have, you always put the money in, you always put your salary in and it says, Oh my gosh, you're gonna be like poverty stricken. This is the thing. But it to have this point, you'll probably have a gap. But that's the only way you're going to fix it is if you start to figure out okay, wow, look at this. We have a council which is like our board of directors, but we have a council of people who are definitely compact signers are very, they adhere to everything they can do to make their companies more diverse and more fair. And it was a woman owned engineering company. And she was sure she didn't have a gap. But she did the math and lo and behold, she said my gosh, I didn't even know this. So that's sort of behind the you gotta see it in order to make a difference.

Julie Murphy  19:56

Right. Well, your timing is great for the introduction of the calculator that you This is a question really for both of you as well, what are some of the the non monetary impacts of this gender wage gap? I mean, obviously, women are earning less money, how does it impact things like where they live? Or schools? Or what are some of the other impacts the reach of this issue?

20:24

Well, I think women who want to get advanced degrees or who are focused on career tend to put things off like relationships in marriage and family. And, you know, when I was growing up during the women's movement in the 70s, and that phrase was, you can have it all. And the reality is, you can't have it all at one time. And so the the big choices are in family planning and, and how we the choices that we make on how to design our lives. And so we're having children later, we're having fewer children, that has all sorts of effects in just about everything. And there are pros and cons to each. But women now are the majority of college students. And so we're seeing, you know, we're seeing progress. And if we can get pay equity, right, at the entry level jobs and above it, they should be able to carry it forward, both because they're supported and and taught how to value themselves. And also because it won't be compounding the existing disparities.

22:06

The way that we see it, in terms as the reason the Boston women's workforce Council picked the gender wage gap, as the issue it focuses on B says, We think that it does determine what you bring home and your paycheck determines where you can live, like what can you afford? And then that particular that usually determines what schools your kids go to? And then it can also go as far as to sort of health care. I mean, what what medical health care is, can you have access to how long is your commute all of these things that have something to do with your life, and they just can't change unless you can afford to make a change? So that's really where we see the impact.

Julie Murphy  22:55

Right? So it's interesting that it feels like the younger generations, perhaps the gap is a little less wide. Is that? Is that true? Is that anything that either of you are seeing our new college graduates perhaps more earning more on par with their male counterparts or thoughts on

23:19

AI saw some data recently, it may have been from the American Association of University Women breaking down wage gap by age. And the younger women are doing better. There's there's less of a gap still a gap. But but not it doesn't, you know, and it could be because of that compounding effect over time. Or it could be that, that both sides are becoming more aware of the issue and and looking to fix it.

24:02

I think it I do believe they start at salaries that are very similar now. But just as they said is theirs as they get into childbearing years, there is a real difference. And whether or not you can make that up is the crucial determinant of of where you'll be on the salary scale when you get older.

Julie Murphy  24:24

Right. So what progress is being made and Heather, you and I have talked about the fact that pay transparency is you know, definitely coming on strong right now. I again, looking to the younger generations, they feel much more comfortable discussing their salary and talking to their male colleagues about what they're earning. And so there's there's a lot more conversation about money in salary than perhaps when I was entering the workforce you never talked about and I think that can play a role potentially and, and educating not just The female employees with male employees, do you guys have any thoughts on sort of this, you know, onslaught of patrons, parents, if you will?

25:09

Sure, you know, both both the salary question and pay transparency, which requires employers to publish the salary range from the very beginning and make that information available on on request, not only from candidates but internally as well. And there are different versions of those of those laws there at the state level at this point. They're making a difference. And and the point is to avoid bringing the pay disparities forward from job to job. So by not asking what you made at the last job, the employer has to figure out what the role is worth and then offered that amount, regardless of who the candidate is.

26:04

There's a, an economist at Harvard Business School named Claudia Goldin, who has, she's written a lot about what's called greedy jobs. And those are jobs that, and they're mostly lawyers, where you have got to be there 24/7 are available 24/7. My son has one of those right now. And those, you know, until that changes, until like, she's talks about that she said, that's where it really hits women is that when, when they're, again, when they have people to take care of at home, they can't be 24/7, the same as somebody else who's got somebody else taking care of the kids. So we hope she sees that this again, this might be an opportunity where you can actually come off the clock. I don't know that I'm as optimistic as she as she is written. But that is sort of one of the things that is made. That's always created, the gap is the necessity to be on call all the time.

27:17

Yeah, I dropped out of an interview process with a big firm, because I figured out I was pregnant. And I just couldn't learn to be a mom and be in that kind of pressure and environment. And then later, I quit being a partner in a law firm, because I had two little guys at home and I needed flexibility.

27:42

Right? So law firms are going to have to figure out what to do, because if you read anything is that, especially associates are quitting, right and left, and they're going to firms that give them some remote access. And so maybe there'll be a change we'll see.

Julie Murphy  28:00

point in time, right, where it's not just legislation driving things, employees have the power in this moment, to help drive change by choosing where they work. And when they work. I feel like we need to take the opportunity. While we can.

28:14

Definitely. And we say that a lot in our briefing sessions is that this is a moment in time where hiring is just crazy, as we all know, if any of us are trying to hire, and it should be employees really

Julie Murphy  28:33

have it. So what advice do you have Kim, for a female entering the workforce? Like how do I how do I make sure that this doesn't happen to me?

28:44

Well, you know, it has to do with it has to do with looking at where you're joining I mean being we say for instance, one of the reasons that people take this pledge and join the Boston women's workforce Council is so that they can internally and externally show that they have a commitment. And what Heather said before is really true. You're not going to fix it overnight, but the idea that you are trying is really important to people. So that is one of the things that I would say people looking for a new job should should look at. I mean, do they have any kind of commitment to it to pay equity to advancing people at a more fair speed that has been in the past? And if so, what I mean that that should really be tell you something about their culture and whether or not you have opportunity there.

Julie Murphy  29:43

I read something somewhere recently, where someone was quoted as saying culture is, is the new pay equity. You know, really, you know, that's good. First and foremost, it's really forefront in people's minds. You know, there I think people are much more mindful of the kinds of companies that they're looking to commit to. They're taking a deeper look, you're going on Glassdoor and reading reviews, and you're talking to colleagues, and there's so much word of mouth and social sharing. It really does benefit a company to show that kind of commitment and to live into that commitment. Heather, do you have any thoughts on how a person might? Well,

30:25

I just wanted to follow up on your last comment, you know, all of the things that employers told us were not possible became possible overnight, two years ago. And so I think that lesson is something that people are starting to take to heart too. And, and it's what's so cool about it is that it really does allow for creative problem solving, when you move past the but we've always done it this way. And so the always done it this way, is never going to work again. And it would be wonderful if we could start to really focus on what would be great, what would work. What can we do here, and and I, I think more than anything, people entering the workforce and coming in, have always had technology in their lives. They understand it, they have, you know, they hang out with their friends, no matter where they are, or their friends are. And so I think I think we're gonna see a lot of change, driven by the fact that we were able to change everything in March 2020.

31:49

I think following up on what you're saying, Heather, I think there is a new definition of the, you know, ideal worker, and it has to do now, a lot of things that women happen to be very good at, it has to be sort of being able to understand when you need a break, when you don't need to break being able knowing when to reach out to people because you want more of a connection, or you have to really understand what it is they're feeling all of those things that many of us had to learn to do remotely. Women have done for a long time. So there is some hope that that that the the new skills will be thought of as Yes, that makes a really good manager now because you have to figure out how to manage probably a hybrid team. And that takes a different kind of skill set than we've seen in the past. So I am hopeful they're

Julie Murphy  32:47

in terms of a company in addressing in evaluating, say, their pay equity and doing the analysis. Heather, what roles within the company are typically responsible for that?

33:02

Well, H HR usually is the one is sort of the keeper of the administrivia. CFO and you know you need a lot of Right, right, right, exactly. But it as far as getting the analysis done that should be done by probably HR and and you want legal involved with that as well. Because even though the data can be discovered, if you have your lawyer involved in the strategy, and the and the figuring out the solutions, those discussions can maintain confidentiality. And so while you're sorting it out, because you're going to have a problem, you're going to be exposed to some liability. And you want to be able to discuss it, frankly, you want to be able to try different options and understand their impact. And so if so having your lawyer involved will help manage your risk and maybe even come up with a better idea. On behalf of the lawyers.

34:18

One of the things that we say is that it does have to come from the top though, you will not see any of this actually working unless the CEO really believes in it. And so that's another thing that people can try. I mean, try to see if it's somebody if the leader speaks a lot about this, when he or she is presenting the idea that they want to advance. They want to pay them what they're worth. Because, I mean, we've all seen we've all been at companies where it's been talked about but it really doesn't happen and if the CEO doesn't really care and frankly if if it's not public Part of my compensation, if I'm not accountable for it, then then it's just talk.

35:07

But that information is easy to find go look at the executive team and see if there are any women.

35:14

That's very good boy.

Julie Murphy  35:18

Oh, my gosh, is there anything else that you you think that an HR person should know or understand about the process? You know, does it perhaps seem very daunting? Can what? What sort of holds companies back from from sort of working with you and moving forward on this issue? And what kind of gets them over the hump to think you know, what we this is achievable?

35:41

Well, interestingly enough, it's it's the lawyers, other, it's the lawyers who are afraid of the Information Act, even though we have data scientists, because we're connected to Boston University, who I my opinion, it's too confidential, because I, people ask me, Can you tell us how we did against everyone else, I don't even know what your data is. Because the minute it comes in, it's masked. And then it's aggregated with all the other masked information. But the lawyers when they first hear the idea that their payroll data is going to be part of a community snapshot, they freak out. And so that is really the hardest thing to get through the HR people kind of get it. Even the CEO, but it's the lawyer who scares them.

36:30

Yes, lawyers, chicken, little lips in our heads.

36:36

That's what they train you. I mean, you're out of jail, or I get that, but yeah, in our case, we can't even get the information could even be hacked. But if you see there's a problem, people are afraid that that could be used in a lawsuit, I suppose.

36:53

But get out there, it's much cheaper to pay employers, employees well and achieve pay equity than it is to litigate even one lawsuit. A lot of times, you know, look, look at at the real out of pocket costs, and not withstanding any sort of hit to your reputation, or news or whatever. But

Julie Murphy  37:26

yeah, the ability to recruit talent, right?

37:29

Exactly. Exactly.

Julie Murphy  37:32

Is there anything else you want to bring up or, or that you think companies should know about or take into consideration? And I'm sure can, you must have instances where the companies that have worked with your organization, and I've seen some positive results, understand that as Heather saying, it's so much easier, and the more fulfilling, and you have a happier workforce, if everyone feels that they are paid equitably?

38:01

Definitely is true. I one thing that we had a speaker who brought up, you know, you're not going to see the ROI overnight. So if you are convinced that everything has to pay out, within six months, you're never going to do this. But over time, you will have a much more diverse and energetic and creative staff that is eventually going to make you a better company. You have to have some patience, though. So I guess that is overall what I would say is, it's it's a long slog, I understand that, and that's part of what we do at the BW WC is we want to support employee journey, but it will take some time.

38:48

Well, because the data is available, everybody has it. And and these tools exists to understand and calculate there's there's going to be a change in the expectation of what people know and what they reasonably should have known about what's going on. And so I think the light the the risk goes up now in not knowing and that's a change, you know, that the idea with most of the civil rights laws was it's a compliance issue. We're going to pretend like we don't know anything and wait until somebody gets brave enough to tell us there's a problem. And then we're going to rise up to protect the organization and the problem will continue. And, and I I think we have to take a more proactive approach that that providing equity providing discrimination and harassment free workplaces are health and safety issues, that that need to be treated as prevented. Is and monitored and care applied. Because discrimination is a form of trauma. And whether it's in your paycheck or whether it's some sort of expectation that you are less than because of who you are, who you love or who you believe in. That's crazy. So, so I think I think we need to get at the root of the issue and work hard to prevent it and and that will make compliance easy and save you a lot of legal fees.

Julie Murphy  40:49

Right. And it's the right thing to do. Yeah. Right. It is. This has been so illuminating. Thank you both so much. I have greatly enjoyed the conversation. I'm sure our listeners will as well. And we hope to see some progress on this. I'm fearing that it won't be in my lifetime, but

41:09

Oh, no, wait, well, no. We will see progress.

Julie Murphy  41:13

I saw a headline in 25 years, the pay gap has shrunk just by eight cents.

41:19

I know. Yep. I have a co chair who's eight years old. And I've got to tell you, she wants this done tomorrow. Um, so yeah. I know, step by step. Right.

Julie Murphy  41:31

Right. Well, thank you both so so much.

41:35

Thank you, Julie.