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Blog: 5 Tips for Conducting a Membership Pay Equity Study

5 Tips for Conducting a Membership Pay Equity Study

Most association professionals are already familiar with compensation and benefits studies. A more specialized type of review is the pay equity study. The two types of studies are related, but pay equity studies also analyze pay according to demographic information about gender (and sometimes race).

Pay equity is an area of increasing focus for many business leaders, often driven by such factors as a changing economy, the rise of remote work, new laws involving pay transparency, and calls for diversity, equity and inclusion (DEI), to name a few. Indeed, many companies have formed benchmarking committees specifically focused on improving their organizations’ DEI and making their compensation practices more consistent. It’s no surprise that for many of these committees, issues of pay equity are high on the agenda.

For associations, pay equity studies can offer a multi-faceted opportunity. For example, their member companies may be concerned with issues of pay equity themselves, but often lack the expertise or resources to adequately assess the issue on their own. Pay equity studies can help member companies look more clearly at their own behavior around pay equity, and take steps to address them before they become more serious legal or public relations problems.

Below are five best practices involving pay equity studies, based on our experience working with association clients.

1. Let your members lead the way.

To help your members begin to address the topic of pay equity, the best way to start is to form a benchmarking committee of members or stakeholders to focus on the issue. It’s important to include on that committee a good representation of your membership in general. In particular, make sure to solicit the involvement of some of your larger members, as well as representatives of various important segments within your membership.

2. Consider working with a fiduciary partner.

Issues of pay, and pay equity in particular, are extremely sensitive. Many companies are understandably hesitant to be completely forthcoming about such a sensitive topic, so you can help your cause by engaging with a trusted third party to gather and analyze the information. In our experience, associations’ member companies tend to be more comfortable interacting with a fiduciary when it comes to sensitive financial information — so, even if your staff has the expertise to conduct the survey in-house, it may still be to your benefit to use a third-party fiduciary.

3. Be transparent with your stakeholders.

Because of the sensitive nature of the study, it’s a smart idea to communicate early and often with your members about what you’re doing. As you move forward, make sure to communicate to any members who have expressed an interest in participating about how you will protect their information and ensure that their responses remain anonymous. You also want to get the buy-in of your participating member companies’ management, as well as the management of your own association.

4. Make sure your own HR function is centrally involved.

It’s neither simple nor easy to interpret the results of a pay equity study — let alone know what to do next. For example, it’s one thing to determine that there is an inequity in pay, but another thing entirely to understand what the drivers causing that inequity are. Likewise, determining the best solution is often more complicated than one might think. For all these reasons, it’s very helpful to have your own HR staff engaged in helping to analyze the data and determine how to share it with members.

5. Take the time to plan and implement your study effectively.

When surveying members, we often recommend using a “reverse engineering” approach — in this case, starting by having your steering committee identify the particular types of data and analysis that would be most useful to members. Also, think about how you will share the data and the findings with members. In our experience, one of the most effective solutions is to create online dashboards, discreet resources that member companies can use to view their own results and compare them with other companies in their industry. Planned effectively, there may also be opportunities to generate non-dues revenue from the survey — for example, by giving members an opportunity to pay a fee for customized reports or other options.

Conclusion

Conducting a pay equity study can be a powerful way for an association to serve the needs of its members. The HR professionals in your member companies are always looking for relevant data to help them understand where their organizations stand in terms of pay equity, and what, if anything, they need to do in response. Armed with these insights, they can strive to address problems before they become worse. In the process, they can improve their brand, boost employee morale and strengthen their ability to attract new employees.

Your association, meanwhile, can also benefit from leading the way on a pay equity study. Not only do you make yourself more relevant to your members, but you potentially also help them avoid the cost and embarrassment that can happen if pay equity issues go unexamined and unaddressed. That said, they can also be highly visible, high-stakes undertakings, so it pays to proceed with caution. Feel free to reach out to, Vault Consulting, if you need any guidance or support — and best of luck as you move forward!