### Step 5

Calculate the gender pay gap as a percentage, using this formula:

Pay Gap = 1 – (average salary for women / average salary for men x 100)

In this example, it would be 1 – (40,000 / 50,000 x 100) = 1 – 80% = 20%.

So to put it in simple terms, women at this hypothetical company earn 20% less than men. Or you could say that women earn 80 cents for every dollar earned by men.

### Extending the Calculation

Now, you can use the data about job type, seniority and experience level to compare like with like. Here are some questions to consider:

• For senior sales managers with at least ten years of experience, how do women’s salaries compare with men’s?
• Do the ratios of men to women and their salaries change at different levels within the organization?

By extending the calculation in this way, you can get much more granularity in your gender pay gap statistics and start to identify patterns. Then you can use the detailed information you’ve gleaned to start putting together an action plan to achieve pay equity. We’ll look at how to do that in the next section.

## 4. How to Achieve Pay Equity

As we’ve discussed, there can be many reasons for a gender pay gap within an organization. So once you’ve established the overall figure, you’ll need to dig in and get more detail as described in the previous section.

Your action plan will be dictated by those results. Some companies might have a dearth of women in the top jobs, for example, while others might have women in senior positions who are underpaid. There are many possibilities, but here we’ll look at some common scenarios and how to start fixing them.

### 1. Same Job, Same Pay

The first place to start is by identifying any situations in which a man and a woman are doing the same job at different levels of pay. Go through them on a case-by-case basis and figure out how it happened.

Is there a real justification, e.g. has the man earned a higher salary through better performance reviews and merit-based pay increases? Pay equity doesn’t mean that everyone has to be paid the same—there can still be room for rewarding some people for outstanding work. But it does mean that you've got to justify any inequalities very carefully. Be sure that the reasons for the difference are real and aren't the product of unconscious bias. Learn more about unconscious bias in this tutorial:

If there's no logical reason for the difference, eliminate it immediately by giving the woman a pay raise to equal the man’s salary. This is pay discrimination, and you need to act on it right away. Continue doing this until you've eliminated all the glaring inequalities.

### 2. Break the Glass Ceiling

Even when you’ve eliminated the most obvious cases of pay discrimination, you’ll probably still have a gender pay gap in your business. The most likely culprit is a lack of women at the top.

If women tend to have lower-status jobs within your organization, they’re likely to have lower pay as well. So look at ways to help women move up and remove any barriers to advancement.

This is a huge topic, involving everything from mentoring schemes to revised hiring practices and benefits packages. Luckily, we’ve covered a lot of the best strategies for you in the following tutorial:

I’ve also got a tutorial coming up later this month on achieving boardroom diversity, so stay tuned for that.

### 3. Set Goals and Track Them

There’s an old saying in business, “You get what you measure.” So it’s important to measure your gender pay gap not just as a one-off exercise, but on a regular basis—at the very least on an annual basis, but perhaps quarterly or monthly if that makes sense for your business. Add it to the regular package of business metrics that you track.

Also set measurable, achievable goals. Keep in mind that while some changes can take place right away, others may take longer. So you could set an ultimate goal of closing the gender pay gap to zero, with milestones along the way to help you ensure you’re always heading in the right direction.

### 4. What Individual Employees Can Do

So far, we’ve been looking at pay equity from the point of view of a business owner or manager. What can you do if you want to change things in your company, but aren't in a managerial position?

The best strategy is to put together a solid case to help you convince your manager to take action. Look back to section 2 of this tutorial, Why the Gender Pay Gap Matters to Your Business. Feel free to use some of these points yourself, and arm yourself with more facts and arguments from sites like AAUW.

If you've got data you can use from within the company, that can be very powerful. But it may be hard to get that because people’s salaries are generally private, and some companies have rules preventing employees from discussing pay with each other. So don’t break any rules or invade your coworkers’ privacy to look for data. Instead, call for the company to make their gender pay gap statistics more transparent.

What you can do is raise awareness among your coworkers and try to get them to join you. Also talk to your union representatives and any other organizations that may be able to help. The more people you've got on your side, the better your chances. You want to show that this issue matters, not just to you personally but to a broad cross-section of employees and to the company as a whole, so brainstorm ways to demonstrate that. Perhaps you could even run an anonymous survey within the company, like the one we looked at back in Section 2.

If your manager isn't initially responsive, don’t let it go. Keep gathering evidence and building support, and look for another chance to raise the topic in future. This is an issue that regularly gets press attention, so you’ll have plenty of opportunities to return to the subject, hopefully armed with even more persuasive data and support each time.

## 5. Other Areas of Pay Inequality

In this tutorial, we’ve focused on the gender pay gap as an example, but there are plenty of other pay gaps out there. Take a look at our previous tutorial on the dimensions of diversity:

Examine pretty much any of those dimensions, and you may well see a pay gap in your business, because they exist at a broader level. Here are some other types of pay gaps to consider if you want to achieve equal pay in your organisation:

Sometimes, the different types of pay gap intersect with each other and lead to even greater inequality for certain groups. According to Vox:

“Nationally, black women working in full time, year-round positions make 63 cents to each dollar earned by a white man.”

If you recall that the overall gender pay gap is around 82 cents to the dollar, you can see that there’s a big difference here. And, Vox continues,

other groups, like Latinas and Native American women, experience a gap that is even larger, making 54 cents and 57 cents per dollar, respectively.

### Take Action

For each of these types of pay gap, the process is similar to the one we went through for the gender pay gap.

Start by measuring the gap on a high level, and then go into as much detail as you can by job type, seniority, experience level, etc.

Then put together an action plan based on the patterns you see. It may involve anything from changing your hiring process to implementing mentoring programs and instituting better processes for setting pay levels. Set a goal for closing the gap, and keep measuring to track your progress.

## Conclusion

In this tutorial, you’ve learned what the gender pay gap is and why it matters to your business. You’ve learned how to measure it and how to take action to reduce it and ultimately eliminate it.

You’ve also learned about other areas in which pay equity is a problem, and how you can apply a similar process to dealing with those too. For more ideas, read through our essential guide to improving diversity in your business. There’s plenty in there to help you take practical steps towards progress in everything from revamping your hiring processes to building a more inclusive workplace culture.