Problem Solving for Compensation Equity Requires Greater Understanding

The research findings about compensation bias can prove disturbing, especially to those people who have been harmed by it and are still being negatively affected, directly or indirectly.

It’s not just financial injury. It’s psychological and emotional one as well. It might even feel criminal in nature to many.

Hope restored then becomes an uphill climb, difficult and painful.

The experience and perception can be that organizations and individuals that people give themselves to lack the intellectual humility, character, strength and commitment to reveal through action the sufficient compassion, i.e. caring enough, to implement corrective change for compensation equity.

Some important statistical numbers to ponder:

“U.S. women make 80% of what men earn, compared to 60% in 1970.”

“If change continues at the slower rate seen since 2001, women will not reach pay equity with men until 2106.”

“Wages for black men have fallen to 70 cents on the dollar.”

How can a just society, as I speculate we see ourselves as or we strive to become, find that kind of imbalance, that caliber of inequity justifiable, professional, ethical, legal and moral?

Yes, compensation can be a complicated topic yet within the context of the research and the problem the research seeks to understand, it’s far less complicated and ambiguous.

What organizations are not considering is the reputation damage, both internal to the organization and external as far as trust, that occurs with compensation bias and inequity.

Emotions drive beliefs, attitudes and actions. People who feel exploited react, consciously or subconsciously to hurt and negativity. Organizations do and will experience consequences. It’s denial to assume and expect otherwise.

First, why does this type of bias exist and prosper?

The findings, detailed by Tam Harbert in MIT Sloan’s School of Management’s article Compensation Bias is Bad for Business; Here’s How to Fix It:

“To a large extent, gaps persist because of unconscious bias. Despite decades of diversity programs, hidden assumptions and beliefs in stereotypes still influence hiring, promotion, and compensation in subtle yet substantial ways,” Harbert writes.

Let’s look at four words in Harbert’s statement.

Gaps — the reality is they exist and that is pain and gossip within an organization or industry and it results in prevention or trust or forfeited trust, neither influential or healthy within a relationship.

Persist — the gaps are ongoing because they are not being addressed or done so more wisely and with greater commitment. Again, this is a point of toxicity and hidden expense within a business relationship.

Unconscious — while the bias might be unconscious, it is still just that — bias. Little credit is given in any relationship for unconscious or subconscious actions that cause people loss and pain. The expectation is correction and the responsibility assumed by those contributing to the pain should be a self expectation.

Bias — bias doesn’t feel good by those on the receiving end. It creates a negative impression going both ways and bad for the reputation of the person exhibiting bias and for trust quality and relationship health.

Here’s the reality about bias, even if unconscious or subconscious bias: the problem solving attempts will be miscalculated, miss the mark and prove ineffective.

“You can make a one-time correction, which is admirable,” Joan Williams, the Founding Director of the Center for WorkLife Law has said.

“But unless you go back and address the kinds of biases that influence the kinds of assignments people are given and the kind of performance evaluations they get, the same biases will re-emerge over time.”

“Same biases.”


Nothing gets solved well, in other words.

I’ll propose the idea that to solve bias that causes inequity, we have to want to solve it with such conviction that we commit to deeper, more patient research, superior-quality listening to those on the receiving end of the bias, commitment to ongoing compassion and realizing and confession to ourselves at least and to others at best, that our bias that contributes to harm.

We have to invest in a focused, sustainable manner to more expert problem solving to bring into alignment, the equity that is ethical and moral, and do such with the assistance of those who know best (the aggrieved) what equity means, looks like and feels like.

Inequity doesn’t feel like a crisis to those unaffected yet it certainly is that type of struggle and miserable experience to those who live it.

Michael Toebe is a specialist for reputation and crisis, with a focus on communications and risk management, serving organizations and high-profile people. He publishes the Reputation Times newsletter and has been published in Chief Executive, Corporate Board Member, Corporate Compliance Insights, Training Industry and the New York Law Journal. He can be found on LinkedIn and Twitter @ReputationTalk.

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