Pay equity was a big deal in 2024 - with 62% of organizations who participated in Payscale’s Compensation Best Practices Report indicating they had, or planned to, complete a pay equity analysis in 2024.
The Trump administration’s executive orders related to Diversity, Equity and Inclusion (DEI) have left many employers wondering if they should, or can, continue pay equity efforts in 2025.
To answer this question, we look at what is driving the focus on pay equity and how the Trump administration’s actions may impact approach to pay equity.
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Pay equity can be defined as “paying employees fairly and consistently, without discrimination on the basis of gender, race, or other protected categories, but taking into account job-related factors such as education, work experience and tenure”
-Attorney Mickey Silberman, Chair of Fortney & Scott’s affirmative action and pay equity practice group |
The issues listed above are expected to continue through 2025 and beyond.
Given the nature of the executive orders on DEI and their specific focus on anti-discriminatory actions, ensuring all pay disparities are addressed becomes even more important.
Pay equity analysis is a statistical analysis of the degree to which various factors correlate with compensation levels. The results of a pay equity analysis identify areas of potential concern for further analysis and potential action.
Legitimate, non-discriminatory factors that are often included in a pay equity analysis include:
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Did You Know? |
A pay equity analysis uses multiple regression analysis to determine the extent that discriminatory factors, such as gender and ethnicity, and non-discriminatory factors correlate with compensation levels and identifies the reasons for differences in pay between one group and another.
If you would like assistance identifying and addressing issues of pay equity within your organization, contact Beth Ostrem or Adrienne Hard for more information.