HR News & Trends

Weekly Wrap: Women Get More Raises, Still Get Less $$$ Than Men

Female pay

There’s good news and bad news on the workplace gender gap front.

Here’s the good news, according to a new Pay Raise Index from “social HR pioneer” TribeHR, 7.4 percent of women received raises during the first nine months of 2012, compared with only 6.2 percent of men who got a pay hike.

Sounds like progress, no? Good to hear that women, who have traditionally been underpaid compared to men for similar work and job titles, are finally catching up a bit.

Well yes, that’s true, but here’s the bad news: when analyzing the size of pay raises, the same TribeHR Pay Raise Index found that men were three times more likely to earn a salary increase in excess of 25 percent. And if you look at pay raises of 5 percent or more, the data shows that 60 percent went to men and just 38 percent to women.

One step forward and two steps back

It’s like the old song says, “one step forward and two steps back. Nobody gets too far like that.”

“The new TribeHR Pay Raise Index reveals a mixed picture when it comes to fair pay,” said TribeHR CEO, Joseph Fung, in a press release about the latest data.

He added: “It’s interesting to see that women seem to be overtaking men in terms of the number of pay raises given but there’s still a stark imbalance in the size of salary increases awarded. Employee satisfaction and workplace culture play an increasingly large role in a business’ brand reputation — and those who pay fairly and amply recognize employee contributions will reap the benefits when it comes to hiring and talent retention.”

TribeHR analyzed salary and workplace recognition (“kudos”) data from 20,000 employees at 2,200 small to medium-sized companies between Q1-Q3 2012, and although they don’t get into what larger companies did during this time frame, the data is pretty telling that it is still a tough path to some measure of pay equality in the workplace. .

Overall, the TribeHR Index reported that the average salary increase for employees at small and medium-sized businesses grew by almost 11 percent between Q1 and Q3 2012, and that the size of the average salary raise grew from 8 percent in Q1, to 13 percent in Q2, but then dropped to 11 percent in Q3.

More pay for recognition

The they also examined the correlation between salary increases and employees who had received documented recognition for a job well done, finding that 85 percent of documented recognition was given by peers, and, that employees who received recognition from peers were two to three times more likely to earn a pay raise.

This just goes to show you why the crowdsourcing of performance reviews to include what peers think is an important trend that needs to become a more regular and accepted part of the evaluation process. As the TribeHR Index data shows, recognition of good work from your peers makes it a lot more likely that a person will get a raise, and that’s because peers generally have the greatest insight into who is performing well and who is not. Managers everywhere would do well to take heed of that simple fact.

But, I’m also with TribeHR CEO Joe Fung in his assessment that the “stark imbalance” in the size of raises for women versus men is a problem that needs to be addressed. Yes, it always seems to be “one step froward and two steps back” when it comes to righting the wrongs of the past, and this is just another bit of data that shows yet again that no matter how far we think we have come on these issues, there is still a long way to go to finally make things right.

Of course, there’s a lot more than the gender gap in pay in the news this week. Here are some HR and workplace-related items you may have missed. This is TLNT’s weekly round-up of news, trends, and insights from the world of talent management. I do it so you don’t have to.

  • Hostess strike is the final blow to the company. Unions can frequently be as short-sighted as management when it comes to workplace issues, and this seems to be the case with the actions of the second-largest union at Hostess, the long-time maker of Twinkies and other snack foods. The company “is going out of business after striking workers failed to heed a Thursday deadline to return to work,” according to the Associated Press. “We deeply regret the necessity of today’s decision, but we do not have the financial resources to weather an extended nationwide strike,” Hostess CEO Gregory F. Rayburn said in announcing that the firm had filed a motion with the U.S. Bankruptcy Court to shutter its business. “Hostess Brands will move promptly to lay off most of its 18,500-member workforce and focus on selling its assets to the highest bidders.”
  • What happens when you’re seen as hard to get along with? Well, you usually get shown the door — even if you are a valuable, high-ranking executive. So it goes at Microsoft, according to The New York Times, where “(Steven) Sinofsky — who, as the head of Windows, was arguably the second-most important leader at Microsoft — suddenly left the company. His abrasive style was a source of discord within Microsoft, and he and Steven A. Ballmer, Microsoft’s chief executive, agreed that it was time for him to leave, according to a person briefed on the situation who was not authorized to speak publicly about it.”
  • Employers now choosing health care strategies. Now that Obamacare seems to be a reality, businesses are finally starting to get serious about planning for changes to their health care benefits. The Chicago Sun-Times reports that, “Businesses are being forced to take a fast and hard look at how to handle the shift in health-care benefits and potential costs that are part of the law that goes fully into effect in 14 months. “This is here to stay,” said J.D. Piro, a senior vice president at Aon Hewitt who leads the company’s health law consulting group. “I’ve been saying for a couple of years this is by and large an entitlement program, and entitlement programs are very rarely repealed. They can be amended or changed around the edges. But it hasn’t been overturned in court or at the ballot box.”
  • New rules of the game for CEOs. I’ve long made the case that it is crazy to have an intimate relationship with someone you work with, but not everyone agrees with that. Now The Daily Beast gets into why this behavior ended the careers of CIA Director  David Petraeus, the CEO of Waffle House, and the designated CEO at Lockheed-Martin. “Sophisticates know that infidelity happens all the time, in the C suite and on the factory floor. And having an affair, in and of itself, doesn’t disqualify anybody from holding a position of public authority. … In the corporate world, there are plenty of executives, bankers, attorneys  — you name it —whose marriages fell apart as they climbed the ladder. Evolved people generally accept that marriage is complicated, and that things happen. And so as a general rule, when top professionals admit to, or are caught in, extramarital activity, it is regarded as a sign of human frailty or failing  — not as a disqualification or reason to retire. But in each of the three cases that came to light on Friday, there are solid organizational and business reasons as to why the activity  — or alleged activity — was handled in the way it was.”
John Hollon is Vice President for Editorial of TLNT.com, and the former Editor of Workforce Management magazine and workforce.com. An award-winning journalist, John has written extensively about HR, talent management, leadership, and smart business practices. Contact him at john@tlnt.com, and follow him on Twitter at http://twitter.com/johnhollon.
  • jobbook

    Women are definitely still victims of the “beauty is beastly” effect in the working world. The norm of adding a picture to work profiles is nothing but a double edged sword for women.

  • Tatersalad

    Nonsense. Do the same job, get the same pay. We have heard enough feminazi nonsense already. Stop pandering to your gender base

  • Ron1007

    The battle over equal pay and comparable worth is back again. If employers pay plans included a) merit pay based on objective measurements of performance; b) a pay increase when an employee is promoted to a higher level position and c) a grade structure that was consistent with the market place many of our pay problems based on gender would go away. Some studies show that at the upper level positions in the professions that women are paid a shade under what men are paid for the same work. It is the lower level positions where turnover is high, women leave the workforce and return, etc. that the problem exists. But in the end, the best model is equal pay for equal work and we have laws that already cover that. In the end, employers should recognize equal work and apply the law. We don’t need more legislation but good HR practices that insure gender is not a factor in pay systems.