Why Some Workers Are Seeing Unexpected Pay Raises

An increasing number of companies are making broad pay adjustments after delving deep into worker pay data, auditing payrolls for gaps between men and women's salaries, altering wages that are not competitive with rival companies, and amending compensation programs to prevent potential bias, reports the Washington Post . However, there are risks for businesses, raising questions about previous unfair pay practices, misconceptions concerning the adjustments, or budget pressures. This week Nike sent a memo to employees that it would adjust the pay of about 10 percent of its 74,000 workers and overhaul its bonus system, noting its compensation program is designed to "support a culture in which employees feel included and empowered." The new bonus system will still account for individual performance, but also will be based on company performance and targets and reward people more consistently across different geographies or corporate roles, potentially reducing disparities or potential bias. Pay consultants and attorneys note companies are doing pay audits in response to pressure from activist shareholders, reforms to state laws, and increasing public interest in the issue. However, some firms may be unsure that they have the budget to close any identified pay gaps, while others may be reluctant to audit because finding and admitting unfair pay in the past could have legal ramifications.