Diagnosis for Equal Remuneration: A Self-evaluation Tool For Companies and Organizations
What is the Diagnosis for Equal Remuneration Tool [DIR]*
The DIR tool is a new self-evaluation tool developed by UN Women to support companies and organizations in assessing whether they are applying the "Equal Pay for Equal Value Work" principle in line with the ILO Convention No. 100. This principle ensures that not only the equivalent work or work of a similar nature is equally remunerated, but also that work of equal value is equally remunerated. According to the Convention itself, the term remuneration includes the ordinary, basic or minimum wage or salary and any additional emoluments whatsoever payable directly or indirectly, whether in cash or in kind, by the employer to the worker and arising out of the worker's employment.
The tool has been designed to be an accessible and easy method to accurately measure possible gender pay gaps for both equal work and work of equal value. To do so, the tool contains:
a) An Excel file that contains the tool itself, where Human Resources departments enter the data and the tool preforms calculations and displays graphs automatically
b) An instruction manual
c) A “model” Excel file with a fictitious example of the application
The DIR tool was developed by UN Women with technical assistance from ENRED consultancy and support from the European Union within the framework of Win-Win Gender Equality means Good for Business Programme. The initiative also seeks to contribute to the implementation of the Commitments of the Regional Champion for Latin America and the Caribbean of the Equal Pay International Coalition (EPIC).
The reason behind a tool that measures equal remuneration
Many companies and organizations committed to equality may, without being aware of it, not respect the principle of "equal remuneration for work of equal value" and attribute different levels of compensation to work that holds the same value guided by gender motivated considerations.
The DIR seeks to support companies to align their business practices with the Women's Empowerment Principles (WEPs), and to contribute to the realization of Principle 2, which establishes equitable treatment for men and women in respecting and defending human rights and non-discrimination. In addition, the DIR is available for use by companies and organizations involved in other initiatives of the United Nations system and other international agencies that promote gender equality in the private sector.
Who can use the DIR tool?
The DIR tool can be used by any employing organization including: private companies, public entities, associations or foundations, among others, that have a staff of workers.
To facilitate self-evaluation, the DIR tool has a simple and accessible design that accurately measures the possible existence of gender pay gaps within the company or organization. Thanks to various teaching materials prepared to facilitate the use of the tool, Human Resources departments will be able to enter the required data in an Excel table that preforms calculations and displays graphs automatically. It is important to note that since it is a self-evaluation tool, the confidentiality of both the information and the results provided by the analysis will remain within the private sphere of each company or organization.
What information will DIR tool provide?
After analyzing the required information, the company or organization will have precise information on whether the principle of equal remuneration between women and men for a work of equal value is being respected, what pay gaps exist between women and men, where and to what extent such differences occur, and where the potential origins of these differences may be.
With this information in hand, the company or organization can take the necessary steps to correct the identified gaps and eliminate the differences. In addition, DIR can be carried out periodically in order to monitor if the salary gap improves or regresses and act accordingly.
How will DIR tool be beneficent?
Having a remuneration system that will respect the principle of equality for equal and equal valued work, regardless of whether the work is being done by men or women, will provide multiple benefits for companies and organizations. On one hand, it improves working relationships and creates a better work environment, while increasing productivity and helping to attract and maintain talent. Additionally, the commitment to equality shown by companies and organizations improves their social image and acts as an integral part of social responsibility policies.
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*Acronyms respond to its original name in Spanish Diagnóstico de Igualdad de Remuneración (DIR)