How to Do a Salary Equity Study: With an Illustrative Example From Higher Education

Abstract

Regular salary equity studies can be a best practice among employers committed to salary equity and fairly managed compensation. While a well-constructed salary study can identify inequities for amelioration, a poorly constructed study can create rather than solve problems. Organizations may be deterred from doing these studies because of their inherent analytical challenges. We provide a guide for human resource managers describing how to conduct their own salary studies, how to interpret the results, and how organizations can apply the results. We describe best practices across public sector organizations and illustrate them with an example from higher education. We also provide a link to an online appendix containing sample code that can be used to conduct such analyses using two popular software packages. The twin goals of the article are to increase the quality of salary analyses while reducing the barriers to conducting them.