Nike Running Towards Pay Equity Among its Employees
- In 2017, for every dollar a white employee made, non-white employees made the same amount
- Nike is raising wages for 10% of its global workforce
The iconic sportswear brand is trying to make sure it has a corporate structure designed for the current climate. In an attempt to get closer to true pay equity, Nike (NKE -5.70%) announced more than 7,000 employees will receive pay increases and the company has also changed its bonus structure.
Why This Matters: The Beaverton, Oregon, based company announced 10% of its global workforce will receive raises after reviewing an internal audit of its pay scale, according to The Wall Street Journal. Nike Ceo Mark Parker oversaw the exits of six executives this year and pledged to change the company’s pay-scale along with management training back in May.
Nike’s web page for diversity and inclusion boasts that for every dollar a white employee made, non-white employees made the same amount, as of the 2017 fiscal year. Digging deeper, 23% of the sportswear company’s workforce is black, while five percent of directors and eight percent of its VPs are black.
The company’s commitment to diversity appears genuine, since it is the largest sports apparel company to make publicize the diversity throughout its ranks. While Adidas (ADDYY +0.58%)tracks gender diversity and nationalities, equivalent data is not available for its executives and Under Armour (UA -3.11%) has not made the diversity of its workforce public information.
Also, Nike will retire a bonus system that rewarded a combination of employees’ individual, team and company performance. Instead, bonuses will be calculated solely based on Nike’s performance. The company can afford to put its money where its mouth is, following the conclusion of its fiscal 2018 year that saw company stock consistently outperform quarterly projections, dating back to October 2017.
Situational Awareness: The sportswear company faced a major corporate overhaul earlier this year in the wake of the #MeToo movement. An internal survey done by women at the sportswear company landed on Parker’s desk in April. These survey results revealed widespread discontent and harassment and led to the restructuring and exodus of six executives, including former Nike president Trevor Edwards.
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