Gender Pay Equity

After launching our new compensation framework (you can read about it here) we decided to take a look at gender pay equity. After all, the ability to do analysis on pay diversity to ensure we’re paying everyone fairly, was one of the key drivers for creating the new compensation framework.

We wanted to focus on gender pay equity, rather than the gender pay gap, as we believe it’s more relevant to see that males and females are paid fairly for the work they do. While we lead our industry for female representation, we still have much larger male employee numbers particularly in technical roles, and already recognise the need to bring more females into technical roles and senior management positions.

But while we knew we had a salary system which would help and support us to do this analysis, there were a few things we had to be mindful of before getting into the detail.

Gender equity is complex. There are a number of ways to measure it.
Directly comparing males’ and females’ pay shows historical gender bias in role type.
Technical roles on average are paid higher than non-technical roles.
So with that in mind, and a bit of research (Glassdoor provides some pretty comprehensive reading), we landed on the following approach to measuring it.

●     Regional – each region would have a separate analysis before being rolled-up to a global figure.

●     Role levels – based on ‘job size’, combining all roles at a similar level based on skills and experience. This allows us to compare different roles across the business and against the external market.

●     Average Base Salary and Target Total Remuneration – we have used both compensation elements when comparing roles internally and externally.

●     External comparison based on role-specific market data.

●     Data samples – at least 5 females and 5 males per role level (within each region) would be required in order to have a meaningful comparison.

We recently announced the results at our ‘global all hands’ (our regular stop-work global meeting) and in remuneration and reward overviews for managers in each of our regions. The aim going into it was to tell the right story, and while the results were also a great news story, the more important part for us was the ‘where to from here’.

Going forward we’ve made a commitment to assess where we stand at least annually and review any unjustifiable gaps. We will also do an annual review of average salary increases for females and males.

Career development is also a key part of the equation. We want to look at the rate at which males and females progress within career disciplines such as software engineering as well as progression to managerial roles to ensure there is no bias in career or salary progression. We have leadership programs in place and are piloting a mentoring initiative which we hope will support and encourage females in their careers.

Diversity and inclusion continues to be a strategic priority for us. We’re operationalizing this through ongoing comms to build awareness, training in diversity/inclusion/unconscious bias, supporting flexible working, promoting D&I hiring practices, and keeping in touch with people on parental leave.

Regardless of where Xero or your organisation sits today, the real value is in understanding long-term trends in gender pay equity, including career progression, and taking action to ensure you’re heading in the right direction.