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Unequal Pay Puzzle: What Should I Do?

A. Welcome to reality, where internal pay scales often trail the market place, motivating many an employee to take advantage of the arbitrage opportunity presented by a job switch.

"Whereas some organizations try to rebalance this compensation, others do not," notes recruiter Peter Gonye of Spencer Stuart. Some firms are apparently content to watch their human capital walk out the door and simply brush off the sting of another recruiter's fee. Others can be prodded into remedial action if approached the right way.

"This is a very slippery slope, because most companies have very strict policies geared toward prohibiting discussions of salary among employees for this very reason," says outplacement consultant Rod Williams of Lee Hecht Harrison. That means you can't use another person's salary as a basis for negotiation. On the other hand, says Williams, "If you don't ask, you don't get."

Do your homework comparing salaries for similar positions across the industry, then ask a mentor or other champion of yours at your firm for insight into the best type and style of approach.

Gonye cautions that if the difference between your salary and your new colleague's is less than 20 to 25%, it may seem petty to protest. He urges taking the long view. "As evidenced by the rotations you have made, and the high regard in which you are held, there is no reason to assume that you are not on a fast track," he says. "If the compensation difference is modest and if you continue to progress in your career as you've been able to achieve up to now, there is no reason to presume that eventually the compensation difference will diminish or disappear."

Though the details of your situation don't necessarily suggest this, it's worth noting that your firm may not legally pay similarly-situated employees different salaries if the basis for doing so is discrimination based on age, sex, national origin, disability, or some other factor protected by federal, state, or local laws. "You may be able to establish the elements of a discrimination claim based upon such discriminatory pay," says employment lawyer Ken Taber of Pillsbury Winthrop LLP. "Your employer would then have an opportunity to rebut your claim, however, by offering evidence that the pay differential is based on legitimate, nondiscriminatory reasons."

Finally, if you find your work engaging and rewarding on a non-monetary level, take a deep breath and remind yourself how fortunate you are. In an industry where people too often chase dollars over job satisfaction, you may be wallowing in the ultimate pot of gold.

Next week's question: I'm 32-years-old and I am a vice president in the CFO's office of a middle-market securities firm. My interest in eventually becoming a CFO has diminished because of Sarbanes-Oxley. The trouble is, I'm not sure what I want to do next, or where my skills might best apply. Any advice would be appreciated.

What would you advise? Send your answer to expertadmin@efinancialcareers.com.

Look out for the experts' answer to this dilemma and readers' comments

on Ask the Expert next week. If you would like to submit a question to

our panel of experts, ASK THE EXPERT.

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AUTHORAnonymous Insider Comment
  • Ma
    Martin
    11 April 2008

    I am also concerned about equal pay & have similar circumstances. In response to the comment regarding "not legally paying similarly-situated employees different salaries if the basis for doing so is discrimination based on age, sex, national origin, disability, or some other factor", how can an employee have a case on discrimination if they are of the same sex, nationality, etc, etc?

    For example, I am being paid differently to two of my colleagues, one male & one female who have no more skills, experience or time served with the company and are doing the same job. Both of my colleagues are paid different amounts.

    My female colleague can legally request to be paid the same as her male colleagues & vice-versa, yet I am unable to request the same salary as my male colleague, apparently because of the genitalia we posses. This IS sexual discrimination from whichever standpoint.

    How can this be lawful???

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