Lessons From the US Women’s Soccer Team Pay Dispute

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Aug 29, 2019

The United States women’s national soccer team (USWNT) deserves a right to pay equity, and after investigating all of the publicly available data (Google Drive or downloadable Excel) on the complex compensation levers for the men’s and women’s national teams, I believe the men should actually be making less.

The challenge is in analyzing the idiosyncrasies in these labor agreements, much like in corporate America. Most compensation teams across several different organizations see their own pay practices and behaviors as individual, unique and chock full of exceptions. Analyzing pay is difficult because you can have people in similar jobs with different pay and it’s completely justifiable. One person has more tenure; one person is more educated, etc. In corporate America, the issue arises when you’re trying to ensure the differences are explained by legitimate, lawful reasons (read: not because of gender).

Although it may seem like the data is clear with soccer – the women perform better, win more, are paid markedly less, incur lower expenses, and more – it is still difficult to pursue a true apples-to-apples comparison to the men. The same is true in corporate America. We need to look under the hood at all levers that are deciding compensation, and this is something that (prior to the advent of innovation and software) was possible only after a lengthy and expensive engagement with a law firm, HR consultant and labor economist.

There is a  lot we can learn from this ongoing issue of equal pay that the USWNT has brought to light. In fact, if the soccer teams represented corporate America, we may very well be having a discussion with senior leadership about the potential liability that’s associated with paying two groups similarly when, by almost every objective measure, one group is outperforming the other.

Fortunately, there are easy steps organizations can take in assessing pay equity:

Step 1. Conduct ongoing pay analyses

What’s clear is that true pay equity is complex. It requires analysis that is done using vetted methodology which includes multivariate regression to assess whether or not differences in pay are happening because of something like gender or race. Only through a thorough analysis can a company look at the full picture and scope of substantially similar groups of employees and compare like-to-like.

Step 2. Document your pay practices

If a company has a documented pay practice of compensating for additional education, for example, then as employees gain additional levels of education (Masters, PhDs) pay should go up. It’s only through ongoing pay analyses that this can be predicted and validated as a lawful factor. For example, if the U.S. Soccer Federation had a disciplined practice of paying based on level of  experience, the women should be paid more, as they are, on average, 3 years older with more time on the field.

 Step 3. If you get one thing right, make it starting pay

The single most significant factor in most pay analyses is starting pay, with women typically starting out behind men. With this, the pay gap persists and, if left unchecked, will widen over time. However, the ability to negotiate doesn’t absolve an employer of its obligations to pay employees without regard to gender.

Pay analysis can’t be a one and done initiative. As companies change over time — and all lasting organizations do — they must continuously check in to ensure that pay gaps are still narrowing. Even if a company manages to vanquish its pay gaps, executives need to stay vigilant and make a commitment to eradicating any pay disparities that may exist, once and for all.