Covering Your Company from the Ledbetter Act

I attended a seminar late last month with our HR Executive Roundtable Group and the discussion with the presenter was on fair and equal pay as a prime topic. A great session I may add and a great presenter. As we all know, there are usually pay discrepancies within our organizations and with the signing of the Lilly Ledbetter Fair Pay Act as well as the Paycheck Fairness Act you really need to do the following to cover your company from potential liability. Here is what you should do:

• conduct a pro-active pay diagnosis under attorney-client privilege to review reasonable measurements and develop business related factors to explain pay;
• consider remediation strategies to reduce risk;
• review and strengthen documentation of compensation decisions - a real must here;
• review current pay practices setting pay-on-hire, promotion, and demotion, developing tools to identify paired comparators;
• use compa-ratio, rate range differentials/penetration and how they interface with on-line performance measurements;
• consider that old compensation rule, lost in the years, broad banding; and
• consider using an outside firm to review your compensation practices and ranges.

These are just a few of the things you as HR leaders should be doing. Suffice it to say that large corporations have already done most of this but my concern is the small to medium firms that do not have the money or resources to review this important issue.

When was the last time you reviewed your compensation practices. Don't forget sales and commission people either.