Advanced settings for remediation actions
This article will delve into more advanced settings for the remediation actions to help you achieve your pay equity target. We will focus on how the raise configurations work together and how the balances of fairness and cost effectiveness impacts the suggested raises.
Once you have a good and stable model that you want to make decisions on, the next step is to get remediation actions. For further instructions on how to configure basic raise suggestion settings, check out the article [Get suggested remediation actions]. Within the same configuration settings, here are the steps to configuring the advanced raise suggestion settings.
Setting your target as a budget or pay gap
To set up your target, proceed as follows:
Specify pay gap targets for each demographic value if more than two demographic variables are included in the analysis, and different pay gap targets apply for the values.
In line with EU pay transparency directive, you can close pay gaps on a per-group basis by specifying within what groups you want to eliminate all pay gaps. We can limit raise suggestions to one gender if gaps appear in favor of different genders within the groups, or only allow some demographic groups to get raise suggestions.
This is an note/information message.
If you choose to close the pay gap on a per-group basis, the overall pay gap will not necessarily close.
This is an note/information message.
When running a subgroup analysis, the pay gap is measured and closed separately in each subgroup.
Defining your raise configurations
To define your raise configurations, proceed as fiollows:
Set the maximum raise percentage you want to give to any individual. Here you can also choose a minimum percentage to avoid giving out very small raises.
All employees, no matter the demographic factor, can be allocated a raise if they are below a fixed outlier threshold. The threshold is set by selecting Always suggest raises for employees below outlier threshold and inserting a percentage or a std. As a result, all employees below the threshold, no matter their demographic value, will get a raise, to bring them at least up to the threshold.
Select groups of employees to exclude from raise suggestions. For more information on how to manage the employee groups, see: Employee groups.
This is an note/information message.
When running a subgroup analysis, the pay gap is measured and closed separately in each subgroup.
Configuring the focus of the raise algorithms
To configure the focus of the raise algorithms, proceed as follows:
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You can adjust the focus of cost-efficiency versus fairness. When prioritizing cost-effectiveness, the system maximizes the impact of each dollar spent on closing the pay gap. It recommends raises to employees where the expenditure of each dollar is optimized, striving to achieve the pay equity target. However, when the focus is heavy on cost effectiveness, the system is not fully utilizing the compensation model to correct the adjusted pay gap, and correcting the underpaid employees.
With the focus adjusted to fairness, the system utilized the compensation model and targets employees who are the most underpaid, and suggest raises to employees correcting for the underlying biases.
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On the second slider, you can adjust the whether you want to focus on focus between individual or group fairness. The weight of this slider, depends on how much of the slider above is adjusting for fairness. Focusing on individual fairness, the system will target the individual employees who are the largest negative outliers with raise suggestions. Individual fairness is good for correcting outliers at the low-end, but can cause some wage compression.
Adjusting, and focusing on the group fairness the system will target raises in groups that are considered underpaid. For example, if the system detects males being rewarded more for their experience than females, the system will target raises to females according to their experience.
Group fairness closes the gap while preserving the existing relationships between employees in the same demographics, but may end up giving raises to relatively overpaid employees.
We suggest trying different settings to find what best meets your unique circumstances. The default is set at 50%/50%, as this approach captures the best of both methods - raises are given at the lower end of the distribution, but you also give more raises where the gap is coming from and avoid the worst wage compression.