Recent debates about the respective roles of free market and government regulation in pay determination brought to mind the story of a company I worked with several years ago.
This company was a highly entrepreneurial, fast growing and profitable niche healthcare provider. A large portion of their workforce served in one role - a role both central and critical to their core service. Let's call this job Certified Healthcare Technician (or CHT). At the time that I was involved with them, this company was at the forefront of a boom of sorts in this particular medical niche. Because of this boom and the limited supply of CHTs in their particular specialty, attracting and retaining talent in this important role was becoming very difficult. In addition, this company had particularly rigorous performance standards for its CHTs, standards that they believed to be critical to the company's success. This posed a challenge for recruiting and retention, because CHTs had the choice of working in other, less demanding environments for nearly the same wages.
After deliberation, management landed on a unique, two-tiered compensation strategy: Compensation for CHTs would be positioned at the 100th percentile of the local market, while compensation for all other company jobs would be positioned just above market median (50th percentile). Note to the statistically inclined: we had a number of discussions about what, exactly, constitutes the 100th percentile; but essentially what management agreed to was a commitment to be the highest payer in the local market. Period. If someone brought in verifiable evidence that another local employer was paying more for the position, they agreed to either match or exceed it.
This was made completely transparent to the entire workforce. Senior management's message, in rolling out the new philosophy and program, boiled down to this: Filling this role with qualified, high performing employees is critical to our mission. If we aren't sufficiently staffed in this position, we cannot open our doors for business. Want to be paid at this level? Fantastic! We offer full tuition reimbursement for the 18 month certification program - please see Human Resources about enrolling today!
My take? I thought this was a solid and smart move on the company's part, built on a strong business case and executed in an honest and transparent way. Like any other strategy, naturally, it would have to be examined annually in order to see whether it still fit and to adjust it as the situation demanded.
Interesting twist, though - and here's what made me think about it. The CHT population at that time was predominantly female. My recollection puts it somewhere in the neighborhood of a 70%/30% gender ratio.
What if the CHT was a male-dominated job; for conversation's sake, let's say with a gender ratio of 99%/1%? Would I feel differently about the wisdom and fairness of that compensation strategy and the pay differentials it created? Would you?
Could this strategy be construed as discriminatory, particularly in light of "possibly soon to come" pay fairness legislation? Certainly there were other jobs at this employer that were "comparable" to the CHT in education and experience requirements, in level of decision making and problem solving, etc.
I'd like to say no... What's your take?