What Is Pay Equity & Why Is It Important For The Contingent Workforce?

Increased social awareness and workplace transparency have elevated the importance of pay equity beyond just a standard compliance issue for organizations today. It is now critical for organizations looking to attract and retain talent to demonstrate their values and commitment to prospective employees and contingent talent alike. One great way to do this is through a strong commitment to pay equity across the total talent workforce.  

What Is Pay Equity?

Pay Equity is the practice of compensating employees with similar job functions that have comparably equal pay, regardless of their race, gender, ethnicity or other protected status. Not only is pay equity a critical compliance regulation and an important organizational commitment to social responsibility, it’s also important to the business’s bottom line. Below are 3 more benefits that organizations can expect when they implement fair pay policies.

1. Improve Employee Experience and Productivity

A large contributing factor to a positive employee experience rests on the trust and equity  demonstrated from the employer. Recognizing transparency and pay parity helps facilitate the building of trust and is a strong sign to talent that their employer has their best interests in mind. When employees know their organizations are committed, it not only raises the employee experience, but can lead to higher organizational productivity levels too. This is no different for the contingent workforce, which is expected to comprise half the total workforce before the end of the decade.

Learn more about elevating the employee experience in our blog post.

2. Reduce Workplace Turnover

It’s widely understood that today’s labor market is a candidate’s market. The employee experience has fundamentally shifted from an organizational benefit, to a competitive differentiator in the war for talent.

With such a significant emphasis on pay equity, it is important for organizations to implement fair pay policies across the extended workforce, lest they risk the migration of talent to the competition. Minimizing turnover will not only enable organizations to drive cost savings, but will also eliminate the need to devote extra resources on talent recruitment. This will both facilitate increased productivity and lessen the expenditure of time and resources focused on new-hire onboarding and training.

3. Attract Talented New Employees

Not only do fair pay policies improve employee experience and productivity and reduce workplace turnover, but they also serve as a competitive differentiator for prospective new talent. A recent Magnit study conducted in partnership with Werklabs and The Mom Project found that over 90% of contingent workers polled look for new employment when they can increase their earning potential. Fair pay policies will not only help the organization retain talent, but will serve as a winning proposition for organizations looking to leverage the contingent workforce.

Get five strategic tactics to motivate contingent talent when you check out our blog.

Partner With An Organization That Implements Fair Pay Policies

As organizations continue to increasingly leverage the contingent workforce, more and more companies have turned to the help of an integrated workforce management platform to help manage the payroll, compliance and benefits processes for their contingent workforce. However, not all contingent workforce management providers can offer the same breadth of services and benefits. Magnit has recognized the need to increase commitment to the contingent workforce and has not only implemented fair pay policies across our entire platform offering, but we also offer the ability to leverage pay equity analysis services to ensure clients stay compliant while increasing ROI.

If you’re interested in learning more about how Magnit is helping organizations implement winning contingent workforce programs globally, please contact a Magnit representative at info@magnitglobal.com.

Disclaimer: The content in this blog post is for informational purposes only and cannot be construed as specific legal advice or as a substitute for legal advice. The blog post reflects the opinion of Magnit and is not to be construed as legal solutions and positions. Contact an attorney for specific advice and guidance for specific issues or questions.