For equal pay to become a reality, we need changes at the individual and institutional levels.
August 31, 2018 6 min read
Opinions expressed by Entrepreneur contributors are their own.
In a perfect world, women make as much as their male peers, instead of the 82 cents on a dollar that they do today. In a fair world, companies set wage amounts based on work done, and don’t stray from it based on the negotiation skills of the applicant. Unfortunately, the business world of 2018 is neither perfect, nor fair.
Despite the fact that the Equal Pay Act was passed in 1963 and, according to the U.S. census, women are earning degrees at a higher rate than men, women are still indisputably paid less. Why? A lot of it comes down to the culture of negotiation.
As a CEO, I understand how unequal pay happens. I make what I consider to be a fair offer to a female candidate. She accepts. I move on. A few months later, I’m hiring another candidate — this time a man — who insists on a 10 percent increase in pay, as a condition of his hire. I want to hire the candidate and so I accept his conditions. This is a common occurrence across business and, as I pointed out above, very few are fair enough to retroactively increase the salary of employee number one.
For equal pay to become a reality we need two changes: a cultural shift in the way that we teach women to think about negotiation, and a structural shift in the way that companies deal with gender pay gaps internally. Both are critical parts of building a fairer workplace.
Tips to make negotiation more productive — and more fair
The difference between negotiating with (most) men and (most) women is stark. Without hyperbole, I can say that almost every single man that I’ve interviewed has demanded higher pay, while I’d guess that about 10 percent of women have done the same. Over decades of hiring applicants, I’ve consistently found this to be true.
I believe that this basically boils down to differing messages that men and women get over the course of their lives, with men being pushed to be more assertive, and women being taught to avoid conflict. These messages are incredibly harmful, and the first step is education. These are my most important tips for women who are new to negotiating.
1. Negotiation is not conflict. I can’t drive this point home enough. Asking for what you consider to be a fair salary is not an attack on your employer. It isn’t rude, and it won’t be considered an insult. Any smart employer will be prepared to pay up to 10 percent more than its initial offer, because businesses expect new hires to negotiate. Keeping this in mind should help alleviate whatever fear is holding you back from discussing your salary needs.
2. Come to the table with data. Another way to strengthen your resolve (as well as your argument) is to do your research in advance. Glassdoor is a great resource for helping you understand what your peers in equivalent roles are making, and even what you might be able to expect from your future employer. It’s much more compelling to say “here’s the industry average, and here’s what I expect” than to simply ask for more.
3. Practice. It’s great to get yourself hyped to negotiate but being truly ready to handle a negotiation takes actual practice. Write down the objections you think the hiring manager will have to your salary request, and then document how you will respond. Find a friend or a mentor and practice out loud. We’ve all had that moment of freezing up, and if you’ve spent time preparing, the right words will be much easier to find.
4. Decide on your floor in advance and be firm about sticking to it. Trying to evaluate offers in real-time is both stressful and ill-advised. You need to know the minimum that you’re willing to accept before you go into the conversation. If you want $60,000, ask for $70,000. If the company offers you $50,000, be completely firm that $60,000 is your minimum.
Regardless of how women think that they “should” feel about negotiation, the reality is that it is a part of the business. Each of us should be conscious of both how we think about negotiation, and how we talk about it. There’s a cultural shift that needs to happen, and every employee has a part to play.
Building a system that supports equal pay
Individual choices are not enough to drive real change. It is neither fair nor useful to place the onus of achieving equal pay on women sitting in salary. In addition to individuals making changes in negotiation tactics, businesses need to make policies that mandate equal pay for equal roles.
Companies like Salesforce, Adobe and even Starbucks have closed the wage gap and publicly committed to continuing equal pay for equal work. This needs to become an industry norm. Tech companies in particular, which have reputations for innovation and have been so quick to adopt other progressive work-life policies, have no excuse not to do the same.
Another way that businesses can ensure equal pay is through internal reporting that “keep the company honest.” New research from the Australian government found that audits that analyze performance pay and report the results to company boards effectively close the gender pay gap.
Whether you’re in a leadership position or are just an employee with a voice, pushing for these types of policies is the best thing that you can do to bring us closer to an even employment landscape.
The world isn’t perfect or fair, but there are still tangible changes that equality-minded people at every level can make to help change that. My hope is that in the next few years, every woman I interview advocates for her salary needs, and that soon after that she won’t need to.