Google internal study shows they're underpaying more men than women

Google's motto used to be "Don't Be Evil."  The company ditched it last year, much to the chagrin of many Google old-timers. 

But the self-conscious progressive culture of Google remains.  So what is the thinking now that an internal study by the tech giant has found that the company is underpaying more men than women for the same work?

CNBC:

In an effort to address wage equity among women and members of minority groups, Google studied its own practices as it does every year.  But the results showed the company was underpaying more men than women for doing similar jobs in software engineering.

Google compensated 10,677 employees an extra $9.7 million to offset the underpaid wages found in the study, the company wrote in a blog post, though it's unclear what percentage of those recipients were men.  In 2017, Google said it increased compensation for 228 employees it found were underpaid, spending a total of about $270,000.

Google's 2018 analysis found that in one group of lower-level software engineers men "received less discretionary funds than women," according to the post authored by Google's lead analyst for pay equity and people analytics, Lauren Barbato.  Nearly half of the adjustment fund was spent on discrepancies in offers to new hires, Barbato wrote, which was the result of a new hire analysis Google conducted in the 2018 study.

Google outlined its methodology for the report, saying it runs statistical analysis to "look for unexplained differences in total compensation (salary, bonus, and equity) across demographic groups."  Google analyzed every job group with at least 30 employees total and at least five per demographic group.  The analysis included 91 percent of Google employees.

Has Google taken the concept of pay equity too far?  Of course not.  The statistical anomalies found by the study are probably more common than we might think. 

The problem in the "equal pay for equal work" concept has been trying to assign a similar monetary value to entirely different jobs.  For instance, there is a large discrepancy in pay between female lawyers and male lawyers.  Is it due to discrimination?  Or is it the result of the kinds of law women gravitate to versus men? 

A public interest attorney makes a lot less than a corporate tax lawyer.  A lawyer specializing in contract law will make more than one working for a non-profit group.  Where there's a real problem is between defining the term "similar" when it comes to judging pay equity.

JND:

Pay disparity continues even though women tend to bill more accounts than men.  Oftentimes, women lawyers are billed at lower rates than men.  Although women make up about one quarter of the general counsel positions at Fortune 500 companies, they are paid less than men.  Of these positions, men earned 17.5 percent more than their women counterparts with men having an average salary that was 6.3 percent higher and bonuses 31% higher than women.

Among the AmLaw 200, women make up only 4 percent of executive management overall and 19 percent of all equity partners.  Further data demonstrates that the higher the compensation level, the greater the pay increase is favored toward men.

Is the wage disparity due to discrimination?  Again, the problem is that Fortune 500 companies are not a monolith.  They are different companies with different legal needs.  It's a convenient shorthand to talk about "Fortune 500" companies as if they all have similar agendas and hiring practices.  How valuable is one corporate lawyer to one company compared to another?

This is not a simple issue, and reducing it to analytics the way that Google has tried to do is understandable, if misguided.  Of course women should be paid the same as men for the same work.  That's a no-brainer.  And I suspect there are "glass ceilings" all over corporate America and that much work still needs to be done to rectify the real wage gap that exists.

But ignoring reality to do it doesn't make any sense.

Google's motto used to be "Don't Be Evil."  The company ditched it last year, much to the chagrin of many Google old-timers. 

But the self-conscious progressive culture of Google remains.  So what is the thinking now that an internal study by the tech giant has found that the company is underpaying more men than women for the same work?

CNBC:

In an effort to address wage equity among women and members of minority groups, Google studied its own practices as it does every year.  But the results showed the company was underpaying more men than women for doing similar jobs in software engineering.

Google compensated 10,677 employees an extra $9.7 million to offset the underpaid wages found in the study, the company wrote in a blog post, though it's unclear what percentage of those recipients were men.  In 2017, Google said it increased compensation for 228 employees it found were underpaid, spending a total of about $270,000.

Google's 2018 analysis found that in one group of lower-level software engineers men "received less discretionary funds than women," according to the post authored by Google's lead analyst for pay equity and people analytics, Lauren Barbato.  Nearly half of the adjustment fund was spent on discrepancies in offers to new hires, Barbato wrote, which was the result of a new hire analysis Google conducted in the 2018 study.

Google outlined its methodology for the report, saying it runs statistical analysis to "look for unexplained differences in total compensation (salary, bonus, and equity) across demographic groups."  Google analyzed every job group with at least 30 employees total and at least five per demographic group.  The analysis included 91 percent of Google employees.

Has Google taken the concept of pay equity too far?  Of course not.  The statistical anomalies found by the study are probably more common than we might think. 

The problem in the "equal pay for equal work" concept has been trying to assign a similar monetary value to entirely different jobs.  For instance, there is a large discrepancy in pay between female lawyers and male lawyers.  Is it due to discrimination?  Or is it the result of the kinds of law women gravitate to versus men? 

A public interest attorney makes a lot less than a corporate tax lawyer.  A lawyer specializing in contract law will make more than one working for a non-profit group.  Where there's a real problem is between defining the term "similar" when it comes to judging pay equity.

JND:

Pay disparity continues even though women tend to bill more accounts than men.  Oftentimes, women lawyers are billed at lower rates than men.  Although women make up about one quarter of the general counsel positions at Fortune 500 companies, they are paid less than men.  Of these positions, men earned 17.5 percent more than their women counterparts with men having an average salary that was 6.3 percent higher and bonuses 31% higher than women.

Among the AmLaw 200, women make up only 4 percent of executive management overall and 19 percent of all equity partners.  Further data demonstrates that the higher the compensation level, the greater the pay increase is favored toward men.

Is the wage disparity due to discrimination?  Again, the problem is that Fortune 500 companies are not a monolith.  They are different companies with different legal needs.  It's a convenient shorthand to talk about "Fortune 500" companies as if they all have similar agendas and hiring practices.  How valuable is one corporate lawyer to one company compared to another?

This is not a simple issue, and reducing it to analytics the way that Google has tried to do is understandable, if misguided.  Of course women should be paid the same as men for the same work.  That's a no-brainer.  And I suspect there are "glass ceilings" all over corporate America and that much work still needs to be done to rectify the real wage gap that exists.

But ignoring reality to do it doesn't make any sense.