Comparable worth is the idea that men and women should receive equal pay when they perform work that involves comparable skills and responsibility or that is of comparable worth to the employee. It is also known as pay equity. Many jobs are segregated by sex. Different jobs demand valuable skills and abilities. Comparable worth tries to eliminate sex as an element in wage setting.
It is not unusual that there are businesses, especially in the public sector, that implement this comparable worth as a basis of the amount of their employees’ salaries. As this idea has its own advantages to the implementing firm making it a legitimate strategy to determine compensation, it also does have its disadvantages.
One of the challenges they face in examining comparable worth is the variety of ways in which it has been defined, implemented and enforced. The market is neutral and generally does not consider gender differences in valuing work. For example, we cannot compare the job of a ten-wheeler truck (male) to an office secretary (female). It might be mentally hard for secretary to do her job because it requires knowledge but it also hard for the truck driver because it will require excellent driving skills. Moreover, jobs nowadays are not particular when it comes to gender requirements. A woman can do a driver’s job, same as a man can become a secretary.
Wage adjustments based on comparable worth could affect the wages of a large proportion of women workers, as well as the wages of men working in female-dominated jobs. Thus, many employers view the possible economic consequences of comparable worth with grave concern. For instance, not all firms in a particular industry implement this strategy. Adjusting wages to conform with comparable worth might result to major departure from a normal salary pay in the industry. An overpayment of salary would result to employers incurring larger expenses. An underpayment would entail resignation of key employees who will decide to look for greener pastures.
There were some cases or businesses that require more jobs from female employees than male ones. If comparable worth is being implemented, it would be not fair for the female employees if male employees will be receiving the same amount as theirs.
It is not right and just to trim down the current salary of male employees just to meet the salaries of female employees. The effect will be male employees might decide to look for another job outside the company where they can get paid more than what they will receive following the comparable worth. Productivity might decrease because of the loss of efficient skills from resigning male workers. On the other hand, female workers will benefit from this because their salaries will surely get an increase. However, since businesses will take the burden of paying female workers higher salaries, they will tend to hire less females and decrease the number of employees. This might result to many females becoming jobless.
Other than gender equality, it is more realistic to determine the skills and work required in the job in determining the salaries of the employees. Trainings, experiences and educational attainment should be one of the primary bases in the computation of the salaries and wages.
Therefore, the idea may be one of many legitimate strategies to determine job compensation, but management must assess whether their organization will either gain benefits or experience drawbacks out of implementing this comparable worth. As with any other strategies that suits one but not all businesses, the idea of comparable worth can give favorable effects if applied thoughtfully and studied profoundly. In the negative, if this strategy is applied without proper research and analysis, the organization might incur losses rather than achieve its goals of promoting a just and more sustainable workplace for all of its employees, regardless of gender and all other differences.
Businesses should have an evaluation of the job performance of the employees that will determine their effectiveness and efficiency in the workplace. They also have to consider the loyalty and dedication of the employees, including the length of stay in the company because these persons were believed to be the most experienced and skilled workers of the organization. The increase in their salary will rely on the result of this evaluation. Businesses can also categorize the level of increase based on their employees’ performance, giving a higher increase to the top performing employees to recognize their contribution to the company and motivate the less performing ones.
Note that if experienced employees decide to leave the institution to apply for new job in other companies in the area that give higher compensation, they will become a huge loss. Training costs for newly hired employees might be bigger than the increase that they should’ve given to the employees who decided to leave.
Aside from internal factors, a company should make an industry and market study to determine the levels of compensation being given by other companies in the same industry, especially in the same area. This way, overspending on salaries will be prevented, while keeping the company’s compensation levels competitive to attract highly qualified work force.
In summary, the implementation of comparable worth strategy in determining compensation levels must be studied comprehensively and analyzed deeply by businesses since this would entail increased labor costs, with resulting price increases and unemployment, particularly within job categories allocated comparable worth increases. In contrast, this strategy has the potential to boost, motivate, and give higher potentials for the economic and political power of female workers. Management, therefore, must see not only its potential but also any drawback and measure its benefits against its costs.
By: John Levi D. Santiago, RN | Virtual Assistant – HelloRache | Balanga City, Bataan
