Pay is the cornerstone of the employment contract. It is difficult to find any worker that is not concerned about their pay to some degree. The first article reports a study conducted by Statistics Canada revealing that black Canadians earn less than white Canadians on average. Although no specific study is cited, in the second article, U.S. President Barack Obama references the historical gender pay gap. While some researchers contend pay is not a primary motivator, pay differentials continue to be an issue – important enough to occupy the attention of some world leaders.

QUESTIONS:

1. From the standpoint of the human resource management process, why is fair pay important? Identify factors that might elevate the discussion of pay to the level of strategic HRM.
2. Both articles describe key demographic groups with lower average pay. Is this a clear case of discrimination? Why or why not? Under what circumstances would lower pay associated with one group or the other NOT be considered discrimination? How does comparable worth relate to this issue?
3. Imagine for a moment that pay differentials are justified. What alternatives (to direct pay) do employers have at their disposal to attract and retain qualified employees? In other words, if you were limited in terms of what you could pay, what else could you do to keep your employees committed to your organization?

SOURCE: T. Grant, “Black Canadians Paid Less on Average Than Whites: Study,” Globe and Mail (Retrievable online at http://www.theglobeandmail.com/report-on-business/economy/economy-lab/daily-mix/black-canadians-paid-less-on-average-than-whites-study/article1929847/)

See also: J. Trindle, “Obama Seeks Fair Pay for Women,” Wall Street Journal (Retrievable online at http://online.wsj.com/article/SB10001424052748704296604576196103820286140.html)