You’ve heard of the gender wage gap: the well-documented fact that women, on average, earn around 80 cents for every dollar a man makes (the gap is even bigger for women of color).
But in reading up on the pay gap, you’ve likely across other terms like “pay secrecy,” “pay disparity” or “pay equity.” So what does all this ancillary vocabulary mean when we talk about women in the workplace?
Pay disparity
We talk about “pay disparity” when we’re referring to a difference in pay. The term made news recently when USA Today reported Michelle Williams earned less than 1% of Mark Wahlberg’s reshoot fee for “All the Money in the World.” In December, E! News host Catt Sadler said she was leaving the network because of a “massive disparity in pay” between herself and a male co-host.
“I learned that he wasn’t just making a little more than I was,” Sadler wrote in a blog post. “In fact, he was making close to double my salary for the past several years.”
But “disparity” doesn’t always signify an instance of discrimination, according to Ariane Hegewisch, study director at the Institute for Women’s Policy Research. “Pay disparity can also be a kindergarten teacher earns $27,000 a year and a person working as a financial adviser in a bank earns $500,000.”
Pay secrecy
According to a survey from the Institute of Women’s Policy Research, 51% of women reported ” the discussion of wage and salary information is either discouraged or prohibited.” This is pay secrecy at work — the practice that discourages — or outright forbids — talking about pay or discussing compensation with your colleagues.
“Pay secrecy is one of the things that contributes to pay discrimination and the wage gap,” says Maya Raghu, director of workplace equality and senior counsel at the National Women’s Law Center. “This is when you’re in a job and your employer is saying, ‘You can’t ask about wages, you can’t disclose them to each other and if you do you will be penalized,’ — and many times the penalties include being fired.”
Pay transparency
Companies like Whole Foods and Buffer practice radical pay transparency, sharing salaries of everyone from vice presidents to entry-level employees.
“Pay transparency is sort of thinking more affirmatively about how to make it easier for people to find out about pay in their workplaces, as a way to avoid pay discrimination or uncover it,” Raghu says. “So it could be things like banning employers from relying on someone’s prior salary in setting a new salary for a job. It could mean requiring employers to provide a salary range or a minimum rate of pay at some point during the interview, so it equalizes that power imbalance and that information imbalance between a job applicant and an employer.”
Buffer, a social media management company, takes transparency one step further, even publicly sharing the salary formula that calculates each worker’s compensation.
There are multiple shades of pay transparency, Hegewisch says. In some workplaces, you’re able to easily understand who makes what and why — and, she emphasizes, that “why” is the most important part.
“It’s an open conversation,” she says. “You know where you fall and why you fall there.”
Pay equity
The definition here is simple — pay equity is when male and female employees receive equal pay for equal work.
