5 ways to improve Fair Pay and Transparency in your organization 

Employees notice when leaders step up, and a shared vision builds trust and accountability. In fact, 58% of companies acknowledge that employees expect pay transparency, highlighting the growing demand for openness in compensation practices.

Leadership can set the tone here with a clear and bold commitment to pay fairness and transparency. This means aligning on your pay transparency strategy and ensuring your organization has the roadmap and milestones to deliver on it. That roadmap should go beyond simple salary considerations to cover pay policies, job architecture, pay equity and communications, and also encompass your vision around performance assessments, promotion opportunities, incentive awards and career development. 

Action: Create and communicate a fair pay roadmap with clear milestones and timelines.  

One of the foundations of fairness is the concept of equal pay for work of equal value, and many organizations will need to revisit the way they value work before they can evaluate the fairness of their pay. Jobs are being transformed faster than ever; the World Economic Forum predicts that 23% of jobs will change by 2028, with 44% of workers’ core skills being disrupted. That makes this a critical time to understand how this transformation impacts the value of different jobs relative to each other, across the organization.

Upgrading and simplifying your job architecture and leveraging robust job evaluations and benchmarks will help to ensure that you have alignment on the value of work and will form a critical step toward assessing fair pay practices. You can then provide transparency that truly resonates with people. 

Action: Ensure that your job architecture provides a solid foundation that will support your long-term objectives for fairness and transparency. To meet transparency requirements, be sure you can compare jobs of equal work and value. A solid job architecture will be the foundation. 

The subjective nature of performance reviews can create obstacles to build a process that is consistent across the board. Without structured reviews and calibrations, subjective evaluations can lead to unfair outcomes when it comes to incentive awards, raises or promotions. Modernizing performance management systems and incorporating appropriate checks and balances will help to ensure that rewards go to the right people for the right reasons.

Action: Audit performance management policies and practices for potential inconsistencies and equip managers with training to spot and address these issues. Use data to test if these policies and practices are helping to ensure pay fairness or are opening your organization up to further risk. Review training to help managers with their employee discussions around pay.

You can’t fix what you don’t see — or what you’re not looking for. Many organizations conduct regular pay equity audits, but there can still be blind spots. A majority of companies do not share employee pay ranges (58%), adjusted pay equity commitments or gaps (56%) or unadjusted pay gaps (54%), all of which limit transparency, but sometimes also accountability

To shed the full light of transparency and achieve fairness, companies can analyze data related to performance rating, incentive awards, promotion rates, and career advancement (among others). By identifying and understanding underlying drivers of inconsistencies across their pay and people practices, leading organizations will commit to regular audits to not only identify inequities but also demonstrate to employees and stakeholders that fairness is a priority.

Action: Use data and analytics to identify and address the root causes of unintended inconsistencies in your pay practices. Including market benchmarks in internal reviews of pay will help your organization to be more transparent and fair.

Fairness is something everyone in the organization should be part of, and front-line managers are a critical part of the equation. Unfortunately, 46% of organizations still state that a lack of employee understanding of compensation programs and practices is a key challenge. Educating employees about the organization’s pay philosophy and how it impacts them, equipping managers to have open and robust conversations with their direct reports, sharing leadership’s commitments and celebrating progress help keep momentum going and build trust across the board.

Action: Develop comprehensive employee communication and manager enablement tools, host listening sessions to understand colleague concerns and perceptions, and set holistic metrics to monitor progress towards fairness and transparency.