Toolkit: Building Dynamic Employee Career Paths and Ladders

Discrimination is the most common legal issue that can arise in the context of career paths and career ladders. While executive orders and local legislation introduce new complexities, federal laws that prohibit job discrimination such as the Equal Pay Act of 1963 and Title VII of the Civil Rights Act of 1964 change less frequently and still require fair pay practices. Employers should continue to conduct pay audits to ensure compliance, mitigate risk, and maintain workforce trust.

In addition to the risk of lawsuits or unwanted media attention, gender discrimination may cause valuable talent to leave the organization in pursuit of other options.

Gender Disparity, Workforce Integration, and DEI Executive Orders

In this All Things Work podcast episode, Tamla Oates-Forney, CEO of SHRM Linkage, shares how businesses can design viable, holistic, talent optimization programs that address gender disparities in the workplace and use tools for inclusivity and compliance.

Discriminatory Promotions

To reduce the risk of discriminatory promotions, employers need to:

• Clearly communicate expectations and parameters for advancement.
• Ensure decisions to promote or not to promote are based solely on merit, namely, the skills, knowledge, and experience of an individual, rather than any protected characteristics.
• Consider how promotion opportunities are posted — specifically, whether to do it internally and externally at the same time.
• Ensure promotion policies and practices are clear and consistent, taking into account any pay transparency laws at the state or local level.

Pay Discrimination

When positions have established pay bands, employees who are not promoted may eventually reach the maximum pay for their role. To identify pay inequities, HR professionals should look beyond pay differences within the same job and examine the distribution of potential plaintiffs in higher-level, better-compensated roles.

Other signs of potential pay discrimination may include:

• Significant turnover in a department.
• Analysis showing that retention is significantly lower for people with a characteristic protected by federal or state law (e.g., race, color, sex, religion, national origin, age, and disability) by one, two, or three years.
• Equal Employment Opportunity Commission (EEOC) charges affecting a certain department.
• Significant differences from overall pay benchmarks at other employers.

More than 60% of HR professionals said their organization conducted pay equity reviews or audits to identify possible pay differences between employees performing similar work that could not be explained by job factors, according to SHRM research, with more than half conducting them once a year.

HR professionals can help prevent pay discrimination by systematically reviewing promotion practices in three steps:

• Start by analyzing promotion rates to identify disparities, and if so, probe whether those disparities show lower promotions for people with the same protected characteristics.
• Assess how promotion opportunities are communicated across the organization to ensure transparency and equal access.
• Employers that are legally required to file EEO-1 reports can use them to pinpoint any underrepresentation of employees based on protected characteristic, enabling data-driven interventions that support fair advancement and compliance with equal employment regulations.

The Truth About Pay Transparency: Challenges, Risks, and Rewards

In this All Things Work podcast episode, C3 Nonprofit Consulting Group's Nanci Hibschman and Amanda Wethington share how to effectively implement pay transparency practices while fostering open dialogue and empowering managers.