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Pay Inequity

“People don’t care who they hurt or beat. For the love of money.” excerpt from the song “For the Love of Money,” by The O’Jays

Pay inequity. This is a well-worn topic that has been getting a lot of attention, especially over the past few years. Pay inequity is an insidious practice felt by many and one that knows no boundaries. Undeniably, it’s more targeted at certain people based on their gender, age, occupation, education, race, religion, and geography. There are even people in the Hollywood spotlight who have spoken out against this transgressive bias, as even these privileged few have felt the wrath of pay inequity’s duplicitous effects.

Albeit the United States Supreme Court has laws in place to counteract the negative effects of pay inequity, it’s still an all-to-common occurrence, because these laws are not properly enforced with assurances of stringent consequences to the offenders.

You’ve Not Come A Long Way Baby

From 1974 through 2014 the organization, American Association of Women, conducted a research study that found female workers in the United States were garnering salaries (depending on the state) that range from ten percent to thirty-five percent less than their male counterparts doing the same job with the same number of years’ experience. This same organization predicts that based on the current salary trend, it will take another 100 years for this pay gap to close. Further, according to the Organization for Economic Cooperation and Development, the United States is one of the more egregious countries when it comes to the blatant practice of pay inequity in the gender pay gap.

The topic of pay inequity is not just a matter of gender and race bias, however women, especially those of color, tend to be at the bottom of the pay scale. According to an article in The New York Times, a 2016 research study uncovered the harsh reality of how businesses view work performed by women. The study found that duties completed by women are not perceived as being a value-add in the workplace. Further, some researchers suggest that society places pressure on women to pursue historically lower paying female-oriented jobs versus seeking jobs that men have traditionally held. The conclusion here is that women succumbing to these pressures are being suppressed by a society that is not ready to view women as equals to men in the workplace and beyond. But women are not the only people suffering from this bias.

Other Casualties

The topic of pay inequity goes beyond targeting women; it similarly affects both women and men of color. Valerie Wilson, an economist at the Economic Policy Institute, determined that the pay discrepancy between white households and black households in the United States, has widened since 1979. Further the National Women’s Law Center found that the average Latin male and female employee would have to work 73 years longer to collect the same pay as their white male counterparts.

The National Bureau of Economic Research economists, Carruthers and Wanamaker, conducted an investigation to unearth wage discrepancies against black men during the 1940’s. One thing they uncovered was certain localized laws from the 20th century and earlier (mostly practiced in the southern area of the United States) set a precedence where segregated, oppressed black citizens were only allowed access to public schools where very little money was endowed and with that, adequate education was lacking to advance and support post-school employment to better paying jobs. The sad truth is this oppression is still felt and imposed on black working Americans decades later.

Additionally, a combination of age, inexperience and gender can, also, come into play when pay inequity is suspected. As employers are evaluating people entering the workforce and considering their universally under-developed skills, instances of young females being paid less has been reported when compared to males in the same age group.

How Can We Solve This Problem?

As a society, we need to re-examine certain perceptions and traditions, however if we cannot come to a consensus, we will never move the needle forward to solve the problem of pay inequity. To begin, better wide-spread education and public awareness are a must. People need to know where their money is going and how it is being spent. There are many suggested solutions from varying pundits to remedy the pay inequity problem, but they need to see a follow-through on execution. Three such ideas are:

  • Cap CEO pay
  • Increase taxes on the super-rich
  • Penalize companies for shipping jobs abroad

Clearly when it comes to these ideas, we need an aggressive plan of action. Capping CEO salaries, can be done but certain considerations need to be identified first. Who will be the oversight to enforce this? How will the appropriate consequences be determined and how will the policy be imposed? Which CEOs fall into the capped salary structure? Obviously, publically traded companies must disclose their financials, so they’re the obvious choice, but are there other companies which should be considered? Also, setting a limit on CEO exit plans, where all too often, the golden parachute is a ridiculous amount of money. Increasing taxes on the 0.00001 percent of the population that are billionaires is certainly worth a long look. As one solution, a structured plan can be imposed with proper tax levying based on capital gains within identifiable tax brackets. Penalizing companies for sending work abroad is a good idea, but companies need to be properly incentivized to want to keep work here. If companies choose not to observe, then imposing penalties such as paying tariffs, along with increased income tax for business conducted here may need to go into effect. Also, as part of keeping consumers informed, boycotting the company’s products and services may be used as a message to companies that do not comply.

These three options are just a few in a long list of other proposed solutions that have many layers of complexity to consider. With thorough consideration they can work, but a better understanding of the consequences and benefits needs to be carefully weighed first. We need a workable solution with quantifiable outcomes and accountability that incentivizes companies to do the right things and a system in place that oversees the follow-through on execution of the policies. Conjecture is not going to get us to where we need to be. Caring, listening, talking, resolving and taking the appropriate steps to stop pay bias is the right thing to do… of this, I am sure.

 

Photo Credit: nylsmkt via Compfight cc

Are You Paying Yourself Enough?

Paying yourself should be the easy part of running your own business. Yet while many struggle to work out exactly how much they should pay themselves, there are also plenty of others who are unable to rewards themselves with what they deserve.

Working Out Your Salary

First things first is working out how much you should give yourself. When you’re starting out often you can’t give yourself a top CEO salary but you do need to be covering your basics. So work out all of your outgoings – and maybe scale a few down – and check that they leave room for your pay. Don’t be modest and don’t be over-the-top.

Breaking even or even seeing a profit increase for a few months doesn’t mean you can start upping your salary significantly. You need to make sure your company is truly profitable and not benefiting from a short term boost in customers. If you do want to give yourself a bit more though, why not consider rewarding yourself with a bonus made up of a percentage of your profits that month?

After a long run of successful months, you can feel safe to start upping your pay to truly reflect the time and effort you’ve sunk into your business. But what if things have been going well, but you’re still struggling to make the cash you deserve? Your sales have been up every month yet breaking even never seems to get easier. What’s happening?

Review Your Cash Flow

One of the most common problems when it comes to rising sales with no rising income is late payments. It doesn’t matter how much product you’re shifting, if you’re not getting paid for it, it’s not helping. Businesses are more global nowadays and this isn’t just a problem in the US, UK companies are relying on small claims courts to get what they’re owed, while in Australia the government has had to step in with a Prompt Payment Protocol to tackle the issue.

In other words, whether your customers are domestic or international, actually getting paid for your services is an important step in paying yourself. This is why including a late payment clause in your contract is highly important. Include interest and penalties for when your client doesn’t pay up as this will not only encourage them to pay on time, but it’ll make sure you’re not out of pocket when they finally do.

You’ll most likely have some protection in your state, so be sure to research what legal means you can use to get what you’re owed.

Balance Your Books

If you’re not having cash flow problems, yet you’re still struggling to see your fortunes improve, it looks like you’re going to have to balance your books. Money is leaking out somewhere and you’re going to need to fix it. Take a long, detailed look on where all your money is going and try to trim the fat.

It doesn’t have to be one big cut either. By changing electricity provider, looking into free software alternatives, or renegotiating your office rent you can make small savings that can add up to bigger ones. It might even be worth looking into alternative sources of revenue. Got a spare desk no one’s using? Then rent it out to local freelancers for a bit of extra cash.

Finally, if you’re still struggling to make your way despite getting paid on time and cutting any waste, it’s time to re-think your business model. Is it actually sustainable? Are you charging enough? Is your company structure just not viable? It might be that you’re spreading the work too thin and need to cut back on staff or that you’re simply selling yourself too short.

In the end, you deserve to get paid a decent wage for the time, energy and ideas you pour into your business. Spend some of that time making sure that you do.

What Do Interns Really Want? [Infographic]

Developing an extraordinary internship program can be a long and winding journey. You’ll face plenty of bumps in the road, and perhaps lots of trial and error. And as we’ve seen in the news recently, you may even discover some controversy.

But overall, internships can be very beneficial for organizations — not just because enthusiastic young workers are contributing to your business goals. Internship programs can also open the door to a more diverse workforce, help add fresh perspectives to your brand, attract other young talent to your organization, and more.

Of course, employers aren’t the only ones who benefit. Although the state of the internship has shifted over time, its overarching goal remains the same — students and recent grads should gain something educational from their work experience. So, what do today’s interns really want to accomplish, and what else should employers know about them?

The following infographic, based on student employment data from InternMatch, offers insights to help employers map out a more effective internship program. Here are some highlights:

•  38% of interns want better pay
•  30% want opportunities to perform meaningful work
•  47% are interested in access to executives and mentorship
•  California, New York, and Florida are three of the top states for finding college talent

Do any of these statistics surprise you? Check out the full infographic below, and share your thoughts in the comments area.

What are your thoughts? Have you experienced these trends — as an intern or as an employer?

Image Credit: Stock.xchng

Internship Compensation: Does It Pay?

In light of the recent slew of compensation-based class action lawsuits, unpaid internships are a hot topic. And with only 36.9% of companies still offering interns less that minimum wage or no compensation at all, it’s clear that relying upon unpaid interns is more damaging than many employers assume.

How might that “free” extra set of hands leave you paying a price? Take a look at the following infographic, compiled by InternMatch, an online platform connecting the best intern candidates and employers. It showcases several key intern compensation facts, as well as implications for employers. For example:

• 48% of internships accepted by the Class of 2013 were unpaid
• 41% of paid interns weren’t paid enough to cover basic daily expenses
• 65% of students relied on financial assistance from parents during their internships
• 63% of paid interns subsequently received at least one job offer

Whether you’re an intern or an employer, there’s a message here for you. Check out the full infographic, and share your thoughts in the comments area below!

What do you think? Should unpaid interns fight back against employers to recover unpaid wages and overtime?

Image Credit: Stock.xchng