Tali Ramos, Training and Development Director for Health Catalyst, often leads unconscious bias awareness training for the company.
In Utah, we’ve long been told our state has a pay equity problem. Full-time working women earn 71 cents for every dollar a man makes, according to Utah’s Department of Workforce Services. We also know women make choices that affect their pay—taking career breaks to care for children, thus creating gaps on their resumes; selecting lower-wage professions; not pursuing graduate degrees; neglecting to negotiate wages, etc. It seems easy to explain away the wage gap, but is it?
The concept of “choice” is complex when women’s choices are tied to socialization. For example, in numerous studies and multiple labs, evaluators were more likely to penalize female candidates than male candidates in terms of “niceness” and “demandingness” when they self-advocated for higher pay. Researchers from Harvard University and Carnegie Mellon University concluded that by negotiating, women broke “society’s ingrained expectations about how women should act.”
The Utah Women & Leadership Project also found that “what may appear to be decisions of preference by women are often implicitly constrained choices.” Everything from expectations around caregiving to psychological barriers to STEM participation plays a role. These choices—constrained or not—are often used to justify gender differences in pay. However, if they were the sole reason for pay disparities, we’d expect pay parity when controlling for them.
University of Texas at San Antonio shows that controlling for these factors decreases the wage gap but doesn’t completely eliminate it. Researchers from the University of Michigan and Duke University found that even in a homogeneous group—physician researchers—subjects would earn $12,194 more per year if they were male, all else being equal. And the American Association of University Women reported that just one year after college graduation, female business majors in the United States earned 84 cents for every dollar earned by their male counterparts.
While these findings illustrate the reality of the gender wage gap, they don’t close it. That hard work must be done by individual companies, as a growing female labor force and economy demand equity. Some of Utah’s companies are already investigating and remedying the unexplained pay gap in their institutions. Here are the tactics they’ve employed to create more equitable pay structures.
Conduct pay equity audits
One starting point for this work is a pay equity audit. A pay equity audit analyzes employee pay scales against criteria like gender, age or ethnicity. Dramatic wage differences raise a red flag for employers, who can then take action to correct discrepancies.
At Struck, a Salt Lake City-based creative agency, benchmarking is the first step in a pay equity audit. The team determines comparable pay bands for their company’s roles using third-party data from industry associations.
“We use data to understand—regardless of what we think of the person, their history or their resume—what should this person make?” says Pauline Ploquin, president and partner at Struck. “It sounds complicated, but it’s actually fairly easy, at least in our industry.”
Photo courtesy of Struck
The second step in their process involves ranking the performance of all the company’s employees as “below,” “middle” or “top” in terms of performance outcomes. Evaluators ignore any unrelated attributes: time in position, industry experience, education or relationships. “That could sneak in bias,” Ploquin says. The Struck evaluation is based on “very objective performance,” and it determines where employees fall in the pay band.
In 2018, healthcare data and analytics company Health Catalyst also formalized its compensation structure with levels and ranges for roles, making data available for a pay equity audit. “We started looking at pay parity, and we suspected that we may see some gaps,” says Linda Llewelyn, chief people officer for Health Catalyst. Indeed, they did.
Eliminate the use of salary history to set starting salary
Because women are often paid less for their work, using a person’s salary history to set their starting wage creates a self-perpetuating cycle, with women bringing low-wage baggage to every new role. The team at Health Catalyst also noticed female applicants appeared to undervalue themselves when asked what their expected salary was.
“When we first started measuring this, we saw that women were three times more likely to be brought into a new job at the minimum of the pay range as compared to their male counterparts,” Llewelyn says.
So, Health Catalyst simply decided to stop asking about the candidates’ pay history. They began setting starting salaries commensurate with what market data said the role should be paid. They also asked candidates to come to their first interview having researched salaries for comparable positions on websites like Glassdoor or Salary.com. Llewelyn says they hoped this practice would help women recognize the market value of the role they were applying for instead of anchoring to a potentially lower wage from their previous employers.
Provide unconscious bias training
Health Catalyst’s first pay audit indicated more men were receiving promotions than women. “If you see these huge disparities or differences, something’s wrong,” Llewelyn says. “It’s not like men are smarter than women or men deserve more promotions.”
Llewelyn says unconscious bias is pervasive and shows up in career pathing, directly impacting wages. The Health Catalyst team began a search for off-the-shelf unconscious bias awareness training programs. Ultimately, they built their own training, using an open-source tool from Google to create a slide deck template and facilitator guide. They also referenced books like “What Works: Gender Equality by Design” by Iris Bohnet and “Every Day Bias” by Howard J. Ross.
One of the recommendations in these books was simple: conduct promotions on a cycle.
“Don’t just give promotions willy-nilly and [promote] the squeaky wheels that ask for it,” Llewelyn says. “Assess each member of your team to see who is ready for that promotion.”
Health Catalyst initially implemented a quarterly promotion cycle and saw an immediate positive impact. Women made up about 35 percent of the Health Catalyst workforce and soon represented about 35 percent of the promotions. “It was such a simple thing to implement, and just that one thing helped us,” Llewelyn says.
Ploquin’s team at Struck also engages in unconscious bias training. She recommends the Diversity & Inclusion Leadership Training Series from the Salt Lake Chamber and suggests sending a group of employees that cuts through the entire organization, not just HR. “Instead of just having the women attend—because that would be an echo chamber—it’s really important that we have male leadership present, too,” she says.
Tali Ramos, Training and Development Director for Health Catalyst, often leads unconscious bias awareness training for the company.
Create a culture of transparency
In July 2020, the Utah Advisory Committee presented a report to the U.S. Commission on Civil Rights titled “Civil Rights and the Gender Wage Gap in Utah.” Among other recommendations for employers, this report suggested that creating a culture of transparency can reduce the gender wage gap.
Transparency can look different in different companies. At Health Catalyst, there is process transparency, and leadership acknowledges when there are disparities to be addressed. At Salsa Queen, transparency extends to posted wages.
Before Jim Birch joined Salsa Queen as CEO three years ago, all hiring was managed on a case-by-case basis, and it wasn’t easy to maintain consistency. Since then, Salsa Queen has implemented an HR management tool, which formalized hiring processes and made hiring easier. The team determines the market rate for a position and then lists a stated salary for all job postings. During annual reviews, employees have the potential for a wage increase.
“We like to get people in here at the stated wage, then see how they perform, how they integrate,” Birch says. “We evaluate them on things like attendance, skills and cross-training. If a person is one-dimensional, there’s not as much value, but if they have cross-trained in two, three, four areas, that becomes more valuable in terms of pay.”
In 2020, when market wages increased for front-line workers, Salsa Queen raised wages for existing employees by 20 percent. This increase allowed the company to acknowledge the contributions of tenured employees while bringing in new employees below them at market rates. “The pay transparency gives employees the confidence they are treated fairly,” Birch says.
Struck doesn’t publish their entire organization’s pay bands, but employees have visibility to salaries within their “growth trees.”
“It’s not like the assistant gets to see what the CEO makes,” Ploquin says. “Within their department, a junior designer can see all the way to creative director, which would be their own path.”
Struck also provides clear visibility into the objective criteria used to rate each employee in their pay band, determined by the year’s vision and strategic plan. KPIs combine quantitative and qualitative measures that might include revenue, profit, client net promoter score, employee net promoter score or billability. Objectives may also be tied explicitly to whether a specific employee achieved an individual goal.
Implement family-friendly policies
Perhaps the most impactful strategy for ensuring pay equity is to provide general support for mothers and families. “Utah’s pay gap isn’t so atrocious because every company is paying women so much less for doing the exact same job as men,” says Jennica Christiansen, head of people operations for CHG Healthcare. “It’s more that women take a step back in their career to raise children and then re-enter the workforce. … It’s not just about how we pay people; it’s really how we provide the right ecosystem of support for women.”
In a 2020 LinkedIn survey of 3,000 working parents, more than one-third of respondents said they took a career break because staying home was more cost-effective than paying for childcare. Regarding parental leave, a brief by the Institute for Women’s Policy Research showed that when first-time mothers did not use paid leave, there was a 34.3 percent probability of them quitting their jobs, compared to a 2.6 percent probability of quitting when they accessed paid leave.
Companies that provide family-friendly resources can help women maintain their salary progression without sacrificing the goals they have for their families. Utah companies like CHG, Health Catalyst, Lendio and Struck provide 12 weeks of paid parental leave, along with unique benefits like Health Catalyst’s beautiful mothers’ rooms and unlimited family access to behavioral health therapists or Lendio’s gradual ramp-up period for employees returning from paid leave.
“Intuitively, you may think that’s not a pay program, but it is a supportive program to encourage women to continue to pursue their careers,” Christiansen says.
Photo courtesy of Salsa Queen
Change starts at the top
When Health Catalyst started reviewing employee data in 2018, Llewelyn sought outside counsel from the company’s employment attorneys. They advised her that if Health Catalyst saw disparities in the data, the company should take action, and they needed to prepare themselves for the possibility. Fortunately, Dan Burton, CEO of Health Catalyst, was committed to addressing any systemic issues that surfaced. “We have a CEO who really, really cares about this,” Llewelyn says.
Within the first year of Health Catalyst’s focus on pay equity, the team reduced the company’s gender pay gap from 4.5 percent to .6 percent. In 2020, they achieved gender pay parity and have maintained it every year since.
According to Ploquin, the watershed moment at Struck occurred eight years ago when their CEO prioritized pay equity and personally advocated for the cause.
“When you have a CEO—a male CEO—who decides this is going to be the thing he champions, it creates motivation for the team … to really invest themselves in some of these policies,” she says. “It’s a journey made of a thousand steps, and it started at the top.”
