Pay equity software identifies, analyzes, and creates action plans to address employee pay gaps. These solutions focus on measuring salary disparities based on employees’ protected identities, such as race, ethnicity, gender, age, disability, or education level. Organizations use pay equity software to identify individual situations and trends where someone from a protected identity makes less money than a comparable, similarly-skilled counterpart. Pay equity solutions are often used by HR departments to proactively protect the company against future litigation by adjusting employee compensation to ensure employees are getting paid fairly. Legal and compliance teams can use specialized products to prepare reports for EEO-1, OFFCP, or ACA audits. These platforms can assist with the creation of remediation plans and help financial teams forecast new budgets that include funds for equity adjustments.
HR departments may use pay equity software alongside Diversity Recruiting Software to ensure a company is operating equitably throughout the hiring process. Pay equity solutions are sometimes part of a larger compensation management software suite. Some pay equity vendors also provide diversity training while users of other products may consult with outside Diversity Consulting & Inclusion Consulting Providers instead.
To qualify for inclusion in the Pay Equity category, a product must:
- Compare workers across cohorts such as age, gender, race, education level, and other protected identities
- Analyze compensation plans to identify gaps and potential issues for risk mitigation
- Share actionable insights and create a remediation plan to address disparities
