Narrow the Pay Gap: HR Compliance and Payroll Administration Are Offered By PEOs
Source: SOI Blog
June 30, 2010, the U.S. Bureau of Labor Statistic’s survey of 60,000 households reported that the overall full time pay gap between men and women in the U.S. narrowed. In 2008 women were paid 79.9% of men’s pay for the same job, while in 2009 women were paid 80.2 % of men’s pay. Where do women in your organization stand? Are you compliant with the Equal Pay Act?
“Today’s accelerating changes in demographics, economics, pay practices, laws, competition and other factors contribute to the gap as well as to narrowing the gap,” suggests Raymond A. Parker, SPHR, Senior Vice President – Outsourced HR Consulting with SOI, a leading professional employer organization (PEO). “This is more than a noteworthy statistic. Equal pay for equal work is the law. The Equal Pay Act of 1963 prohibits discriminating between men and women by paying one gender more than the other ‘for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions.’ The Act applies to small and large organizations. Noncompliance penalties can have stiff fines such as two years’ back pay for involved employees plus liquidated damages in an amount equal to back pay for noncompliance. It is three years of back pay if the action was willful, plus liquidated damages in an amount equal to back pay,” notes Parker.
Owners and managers need to take note and take action to further narrow the gap and ensure their compliance with the Act. Analysis of actual pay’s internal equity and review of pay practices can highlight causes. Performing effective pay planning can be a solution. Parker suggests, “PEOs, with ready access to the employer’s data from payroll systems, have know-how to analyze pay practices, powerful information systems to analyze data, acumen to find problem sources and can recommend changes. With general business savvy and insight into best practices, PEOs are well equipped to assist employers, stave off claims and satisfy employees. It takes high level skills, knowledge and ability, but that is what PEOs are all about.”
With analysis, PEOs may determine the pay gap is for just cause. There may be sound reasons, for example, often men work more hours than women. Men disproportionately work in higher-paid occupations. Occupational industries, e.g., health and education, may have more women than men; hence pay less than other male-dominated industries. HR professionals can give insight to guide organization decision makers.
The gap trend is changing. For example, for full-time wage and salary employees, in 2009 the median usual weekly earnings increased more for women at 4.2% than for men at 3.9%. Are you making similar progress?
SOI offers professional service to determine where you stand and what you can do to reduce the gap and comply with the Equal Pay Act. Contact us today for a free comparison quote.
SOI is a leading professional employer organization (PEO) for small and medium-sized businesses (SMBs) serving as a trusted partner in payroll processing and employee benefits, integrated human resource (HR) compliance, employment practice liability, empolyee safety, compensation and risk management. SOI is based in Charlotte, NC and supports tens of thousands of worksite employees throughout the U.S. For more details, visit: Payroll Administration.