Equal Pay Act in Healthcare

Kimberly Anderson-Mutch

The Equal Pay Act (EPA) took effect over 50 years ago, yet disparities still run rampant in healthcare. These pay gaps are a significant concern, especially in a field where 86% of registered nurses and 74% of practitioners and technical workers are women. Moving forward, employers must put purposeful effort into cultivating equity in their workplaces. While doing so helps meet EPA requirements, it also offers many other benefits, like improved team member retention and a better company reputation. 

As we approach Equal Pay Day on March 15th, let's take a closer look at the Equal Pay Act, what wage equality looks like in healthcare and long-term care (LTC) facilities, and how healthcare employers can help reduce the pay gap.

What Is the Equal Pay Act?

The Equal Pay Act was enacted in 1963 as an amendment to the Fair Labor Standards Act. It protects workers from discrimination based on sex. In addition to wages, it covers all forms of compensation, such as overtime pay, bonuses, vacation, holiday pay, and life insurance. If there is some form of inequality, the employer needs to equalize pay without reducing the wages of other workers.

The definition of equal pay might seem hard to pin down, but the Department of Labor (DOL) looks to specific characteristics of the job to make equal pay decisions:

  • Skill, as measured by elements like experience, education, ability, and training
  • Effort, or the amount of physical or mental exertion required
  • Responsibility, or the degree of accountability
  • Working conditions, including hazards and physical surroundings such as fumes, temperature, and ventilation
  • Establishment, which outlines the distinct place of business in which the job is conducted

Equal work does not refer only to identical jobs, and minor differences are not enough to make the work unequal. Even if the job title is different, the EPA still applies if the work is considered equal.

Equal Pay in Healthcare and LTC Facilities

In healthcare, equal pay is still not the norm despite the field being dominated by women. Across all industries, women typically make 84% of what men make. In healthcare, the numbers look a little different:

  • Physicians: Women physicians generally make about 25% less than their male counterparts, which comes out to a difference of over $2 million in a 40-year career. The highest disparities exist in surgical specialties, followed by nonsurgical specialties and primary care physicians.
  • Nurses: Women nurses make an average of $7,300 less than male nurses. Various specialties will differ in their pay disparities, but we see the most significant gaps in equal pay for nurses in home healthcare, emergency and trauma, and pediatrics.

These inequalities have a wide range of sources, from unconscious biases in hiring practices to inflexible scheduling practices that don't accommodate childcare needs. The disparity is also heavily influenced by other types of discrimination, such as race and sexuality, and their intersections with gender.

Achieving employee equity and equality in LTC facilities requires a multipronged approach and a shift in workplace culture. It needs to address pay gaps and diversity at all levels and conscientiously attempt to alleviate bias through comprehensive hiring and compensation practices.

The Business Case for Equal Pay

Aside from supporting ethical practices and helping you meet Equal Pay Act requirements, providing compensation that's as fair as possible also comes with benefits for the business.

Equal pay helps with your:

  • Reputation: People want to support companies that support their workers—66% of Americans said they were less likely to buy from businesses that don't pay women fairly. Being vocal about your dedication to equality, such as through lobbying or supporting equal pay-focused organizations, can also put your organization's name in the public's good graces.
  • Talent acquisition: It should be no surprise that people would prefer to work for companies offering fair pay. You can attract better talent and pull in more applicants through fair pay practices. One Indeed study showed that job seekers were 75% more likely to apply for a job if the company had a reputation for fair pay, and they're 68% more likely to apply if a job posting lists the position's pay.
  • Retention: People want to stay with employers that value them. According to the same study, most people who found out they were earning less than someone in the same position started looking for a new job within the year.
  • Staff engagement: Over four-fifths of people said that they felt more engaged and fulfilled by their work and more productive when it paid fairly. Equitable treatment across the company creates a more inviting workplace where workers know their dedication will be rewarded, regardless of their gender.

How Can You Ensure Equal Pay for Your Employees?

Equal pay in nursing and other healthcare professions is far from a quick fix, but there are many things LTC employers can do to position themselves as champions of fair compensation and bring the industry closer to eliminating the wage gap.

1. Eliminate Pay Secrecy

Based on the National Labor Relations Act, all employees are explicitly allowed to discuss pay, yet many workers still don't like to talk about it. The Indeed study reports that 21% of workers and job seekers say it feels taboo to talk about it, while 66% of people haven't shared their salaries at work. Some may be avoiding workplace drama or think that they'll get in trouble for it. These ideas lead to many staff members being blissfully unaware of an unfair paycheck and struggling with it all the same.

You can work on breaking down the taboo by cultivating a transparent and fair environment surrounding pay discussions. Bring it up candidly during interviews, and nix any suggestions that staff members shouldn't discuss their salaries. When healthcare staff understand why they earn what they do, they can freely discuss salaries without creating drama or negative attitudes about the workplace. Empower them to discuss wages and learn what they can do to boost pay, such as taking additional training or learning other roles.

2. Start a Pay Transparency Initiative

A pay transparency initiative clearly lays out your criteria for compensation. Mapping out your pay policies can help you unearth inequalities, develop fairer practices, and show workers that they're receiving fair pay. In this kind of initiative, you could include information and data about factors like:

  • Market rates.
  • Cost of living.
  • Benefits outside of salary, like health insurance and vacation time.
  • Flexible earning potential, like bonuses and overtime.
  • The team member's qualifications.
  • The team member's length of service.

Pay transparency also creates more accountability for the company, as hiring decision-makers have less room for bias. They need to offer pay based on concrete qualifications.

Providing detailed pay information is also great for helping nurses and other healthcare workers see where they can grow in the organization. Say a nurse sits at tier two within her position, and tier three requires a specific training course. She knows that she can get a pay bump if she pursues the training, rather than staying at her current level, unsatisfied with her pay. As a result, she grows professionally and becomes a stronger asset to the company.

Whether you choose to disclose salary ranges on job postings or provide detailed data on your entire pay “formula,” increasing transparency is an excellent way to help achieve equal pay for nurses and other team members. Team members can better understand their salary, appreciate their employer, and access fairer wages.

3. Create an Equal Pay Task Force

An equal pay task force provides a dedicated team to focus on equal pay for healthcare workers in the company. This team might tackle the pay transparency initiative, play an active role in salary discussions, or support company relations with industry groups, such as national nursing associations or political groups lobbying for equal pay. The equal pay team can take responsibility for meeting Equal Pay Act requirements and hold management accountable for meeting diversity, equity, and inclusion (DEI) goals and equal pay policies.

Not everyone sees the issue of gender equality in the workplace—44% of American men think that men and women are treated the same at work. An equal pay task force can bring these issues to the forefront, ensuring visibility during discussions with stakeholders.

4. Advocate for Employees

Team members aren't always comfortable seeking higher pay. Only 9% of women say they always negotiate a new salary, compared to 15% of men. Even for those that do negotiate, the experience can be stressful. About two-fifths of women said that negotiating their salary made them very or somewhat uncomfortable. Half as many men said the same.

Help your nurses and staff gain access to fair pay by advocating for them wherever possible. This might look like nudging someone toward your transparent pay scale before their yearly review or highlighting a nurse's quality of care during salary discussions with administrators.

5. Pursue Family Economic Security Policies

Economic security policies ensure that families can meet their needs, access resources, and participate in the economy. These terms often refer to government regulations, but employers can stay a step ahead of federal requirements and offer these supports through policies like paid family leave, child care assistance, flexible scheduling, and medical leave.

These policies play a significant role in women's employment because women take on more responsibility for child care. A quarter of women said that taking time off after having a child had a negative impact at work, and 27% said they were treated as though they weren't committed to their work. Many women don't have access to paid leave in the first place. Economic security policies can help ease the demands of juggling child care and a healthcare career, allowing women to continue working—and earning equitable pay—without motherhood threatening their jobs.

6. Regularly and Purposefully Review Compensation

Compensation reviews are particularly useful for pay transparency initiatives and meeting the ongoing needs of team members. These reviews provide an opportunity for you and your staff to arrive at the table prepared and ready to discuss pay. Team members can research their worth, and administrators can do the same, factoring in company budgets and worker performance. Conduct reviews at least once a year.

During these discussions, you must understand and recognize the differences that might be present among the patients your staff members see. Patients may make different demands of men and women clinicians or be more likely to prefer to see a female provider for specific concerns. These characteristics can contribute to differing clinical workloads between men and women.

Women physicians, for example, tend to spend more time with patients and enlist more empathic listening because patients open up to them more or seek out female providers. Their productivity measurements might look different, but that doesn't mean they aren't working as hard as others.

Another area where you can offer recognition is in leadership. Senior-level women are significantly more likely than senior-level men to focus on topics like DEI and team member well-being, a critical topic in a field that's notorious for burnout. Unfortunately, this dedication often goes unrecognized. Companies overwhelmingly agree that it's very or extremely critical for management to support team members' well-being, yet just a quarter of them formally recognize managers who do so.

Be holistic in your compensation reviews and consider the unique clinical landscape that your women team members deal with.

7. Implement Unconscious Bias Training

Unconscious bias is a powerful force, with almost three-quarters of women saying they experience microaggressions—everyday discrimination rooted in bias. It often goes unchallenged and is particularly damaging when held by hiring managers and HR team members in charge of compensation decisions. It isn't only perpetrated by men, either. Unconscious bias comes from other women, too, and plays a role in intersectional discrimination.

Overcoming unconscious bias isn't easy, and if done wrong, can actually backfire. Still, implementing the right kind of unconscious bias training—training that teaches people about awareness, managing their biases, changing behavior, and tracking progress—can offer positive results for a more inclusive workplace. It can help you improve hiring practices and cultivate a more welcoming healthcare workplace overall.

8. Modernize Your Management Tools

Many of the issues we've discussed, such as disorganized scheduling and data collection, can be addressed with modern workforce management tools. A smarter management system can allow you to meet the needs specific to an LTC team. When it comes to supporting fair treatment, modernized workforce management can help you:

  • Offer more flexible scheduling practices.
  • Generate comprehensive reports.
  • Access detailed payroll data.
  • Fairly and objectively assess staff performance with robust tools and reporting features.
  • Open more communication channels between management, HR, and staff.
  • Help nurses feel more empowered in their work.
  • Enlist the power of analytics to make equitable business decisions and predictions.

Cultivating a Fair and Equitable Workplace With SmartLinx

SmartLinx is a powerful workforce management tool with a wide range of features to help you provide equal pay and fair treatment in your LTC facility. From collecting detailed performance data to improving communication, SmartLinx is packed with tools to reach and exceed Equal Pay Act requirements. Improve staff retention, help team members feel engaged, and create a welcoming, efficient workplace with this LTC workforce management platform.

Request a demo today to see SmartLinx in action!

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