US employers gear up for new pay ratio disclosure – Willis Towers Watson

Half of US employers state that their biggest challenge in complying with forthcoming new rules on pay ratio disclosure is predicting how employees will react, according to a poll by Willis Towers Watson. However, the research also finds that nearly half of companies in the poll have not yet considered how, or indeed if, they will communicate information on pay ratio to staff from early 2018, even though the latter’s reaction to the disclosure is their greatest concern.

Jim Kohler, director of communication and change management at Willis Towers Watson, said:

‘It’s somewhat surprising that so many companies haven’t considered how or if they will communicate the ratio to their employees, given that so many are concerned about how they will react. We believe this is a golden opportunity for employers to begin a dialogue with not only employees but also customers, investors and media about pay positioning and pay transparency. In fact, we are working with several companies on developing a communication road map to guide them through the process.’

Other challenges in disclosure include:

• determining the required measure
• obtaining accurate pay data
• deciding how to craft the required disclosure
• determining where an organisation’s pay ratio stands compared with peers, the sector and the market.