How 3 Compensation Professionals are Working to Close the Pay Gap

It’s a widely known fact that women make significantly less money than men do. 

The commonly cited statistic notes that women earn 84 cents for every dollar that a man makes, as of 2024. The lesser-known statistics are the ones that actually represent individual people with layered and complex identities.  

When intersectionality is brought into the equation — meaning someone who has several “intersecting” identities such as race, ethnicity, LGBTQ+ and class  — the numbers quickly start to change. For example, The Center for American Progress noted that Filipino women earn 83 percent, Tongan women earn 75 percent and Nepali women earn 50 percent of what white men do. 

The research conducted by The Human Rights Campaign also revealed that transgender women earn 60 percent and Black LGBTQ workers earn 80 percent of what white, cisgender men do. 

Closing the pay gap is a slow and arduous process — 267 years by some calculations. The issues that contribute to pay disparity, like systemic bias and structural racism, also have paramount impacts on health and literacy rates. 

However, not addressing the pay gap may have dire consequences down the line. Unequitable pay sets off a Rube Goldberg machine of negative effects that don’t stop at someone’s bank account. It’s been suggested that income inequality has an impact on climate change, causing a rise in CO2 emissions, especially in the global South. Not addressing the wage gap also contributes to higher rates of poverty, as documented by The Institute for Women’s Policy Research. 

Built In spoke with three tech professionals who are actively trying to close the pay gap in their companies. 

 

CarGurus operates an online automotive marketplace connecting buyers and sellers of new and used cars in the United States, Canada and the United Kingdom.

 

Why is it important to you personally that CarGurus works toward pay equity? 

My personal experiences with pay equity have been very positive — but I know I’m one of the lucky ones. I’m glad I can lean into these experiences to help my colleagues at CarGurus today. It’s very rewarding to know that my role in ensuring our pay practices are equitable and competitive can have a direct and positive impact on their lives. It’s also exciting to be part of a broader movement that promotes diversity and inclusion in the workplace. 

 

If you were to brag to a friend about CarGurus’ pay equity practices, what would you give as evidence?

I love that every element of our total rewards package, including our approach to compensation, is aligned with our company culture and values. CarGurus truly cares about its people and instinctively considers equity and inclusion across every decision that impacts employees, no matter how big or small. I guess you could say we really do put our money where our mouth is. 

 

 

In addition to being very open about our compensation philosophy and approach, we offer trainings that empower managers, recruiters and others to speak to our practices in their daily interactions with current and prospective employees. We also regularly partner with external vendors to ensure we pay equitably and competitively on a global scale, and frequently review our internal compensation structure. If our findings show an employee’s base pay has fallen below where it should be, we adjust it accordingly. This is some of my favorite news to share as it’s our policy in action. It reminds people we really do have their backs.

 

How have the company’s pay equity practices changed in the last year or two? What results have you seen from these changes?

We’re always evolving our approach to reflect best practices, comply with new laws, and make the most of new tools and resources for evaluating equity. For example, in 2023 we rolled out our Career Development Model, a robust framework that defines the skills, capabilities and expertise people need to succeed in every role and level at CarGurus. In addition to helping employees understand what’s expected of them and how to advance, the CDM provides my team with a holistic and consistent view of every role at CarGurus. This helps ensure our pay decisions are consistent across every role, too.

Full pay transparency is a key focus area for us in 2024 and beyond. We currently offer it in all states that require us to do so, but plan to introduce it globally because it’s a key component of pay equity and underscores our broader commitment to diversity, equity, inclusion and belonging overall. I’m excited for all current and prospective employees to have a clear view into their position’s pay range, where they fall into their range and why and how ongoing pay decisions are made.

 

 

 

EzCater is an online catering marketplace that allows individuals to order food from local caterers.

 

Why is pay equity important to you? 

Paying employees fairly for the work they do should be fundamental at every company. Unfortunately, that isn’t the case. I have encountered leaders throughout my career who nickel and dime offers, looking to hire or promote individuals at the lowest possible compensation they will accept. However, this typically leads to bigger issues down the road when employees inevitably learn about the inequity, lose trust in the organization and become disengaged. For example, Payscale’s 2024 Gender Pay Gap Report found that women make 83 cents relative to $1 earned by men. I believe it is incumbent on decision makers to make consistent and equitable compensation decisions to avoid perpetuating inequities in pay.

 

If you were to brag to a friend about ezCater’s pay equity practices, what would you give as evidence?

One practice I’m particularly proud of is ezCater’s approach to correcting pay equity issues. While we do our best to be proactive and prevent them, issues do come up from time to time. Our view as an organization is not “do we fix the issue?” but rather “how do we fix the issue?” There’s an urgency involved in gathering the necessary stakeholders, understanding the cause of the issue and finding a solution because it is important that our employees are paid fairly for the work that they do. If we find that the issue was caused by something systemic — for example, we considered market data from the wrong location as the basis for a decision — we update our internal processes to ensure it doesn’t happen again.

 

 

What have changes in ezCater’s compensation process looked like? 

EzCater has continued the practice of conducting an annual companywide pay equity analysis to correct unexplainable compensation variances across like roles regardless of demographic factors. 

Over the last few years, we’ve done more work to standardize our compensation processes so that we are making consistent, equitable decisions. Adherence to a predictable cadence for when employees will have their compensation reviewed, with regular audits to ensure employees aren’t inadvertently missed along the way is an important part of our compensation process. We update workflows so that strategic people, business partners and the compensation team are consulted. We introduced guiding questions for leaders to assess individual performance and drive consistency in decision-making across the organization. We review individual compensation against benchmark market data to determine if there are any further adjustments needed. 

Since 2021, we’ve posted compensation ranges on all job posts. We lead with transparency, enabling candidates to stay informed from day one. As a result of these changes, we’ve seen leaders be more thoughtful and confident in their decisions, with less volatility and bias throughout the profession.

 

 

 

Grocery TV is a digital out-of-home network that makes it easier for brands to reach their audience in stores.

 

Why is it important to you personally that Grocery TV works toward pay equity? 

Before I was a startup leader, I was a 22-year-old making less than my male peer. I fell into the tradition of women being underpaid, being paid based on a prior salary and promoted once they’ve done the job. I didn’t realize how far behind I was from my peers, because speaking about pay was taboo. Companies intentionally shrouded the “why” behind pay and promotions. The systemic unfairness influenced my career shift into people and culture. 

Today, at Grocery TV, we’re pay and level transparent — everyone can view the salaries and level for each person. Equitable access to information challenges us to be accountable to a fair system. Pay transparency makes it harder to play favorites and use arbitrary standards, biases or feelings. 

Our candidates and team don’t worry about salary negotiations or if we pay differently for the same work. It removes the emotional labor around compensation, especially for historically disadvantaged individuals, such as women, people of color and the LGBTQIA+ community. 

Being part of a leadership team that champions pay equity and transparency is healing. It matters for my past self, the current generations in the workforce and the future my daughter inherits.

 

If you were to brag to a friend about your company’s pay equity practices, what would you give as evidence?

I would show them our internal documentation and data. Transparency is one of our values. Within our internal documentation, we openly share raw benchmark data, our cap table, detailed leveling guides and comprehensive information about individual roles, salaries, equity and past promotions. We want the team to know how our systems work. 

As part of that we prioritize consistency with our data and decisions. We don’t want anyone to fall into the trap of losing out on compensation because they’re not switching companies every few years. 

To keep us honest, we track an individual’s journey from their application to the last day. We slice across personal demographics, managers, levels, tenure, salary and performance ratings to unearth gaps and biases. Currently, our average level is the same across all demographics. There’s no difference in average salary across race/ethnicity and a less than two percent difference between the average salary for women versus men. In the past 12 months, women were promoted at slightly higher rates and joined the company with an average salary above the company average. 

While we have opportunities to grow, we’re sincere and transparent in our path for pay equity. 

 

How has Grocery TV’s pay equity practices changed in the last few years? 

Our big improvement is clarity on leveling. We’ve been transparent from the beginning, but lacked guidance on leveling. This led to inconsistencies and candidate negotiation for level, which was not in the spirit of equitable pay. 

 

 

Eighteen months ago, we built a leveling guide. It’s a living document that we continuously refine to foster a shared understanding across teams about what advancement means. It’s led to better conversations between individuals and managers about how to tangibly grow — but it has downsides. We lost a final candidate for a critical role last year due to our no-negotiation policy. We were open to a range of levels, and unfortunately, we leveled the individual lower than their expectations. They withdrew because we were no longer a compensation match. 

As a hiring manager, it’s easy to get scared and negotiate. But there are no accolades for under-leveling or over-leveling a candidate. It hinders trust from the team, and it’s painful when we get it wrong. We’ve learned that a reactionary exception isn’t worth losing the team’s trust or confidence. Our team counts on leadership to be fair with the data and decisions behind their pay, so we take it seriously. 

 

 

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