I’ve spent 17 years in the Human Resources function at Union Pacific and been fortunate to have held several business partner roles for our operations and administrative departments. An important part of my job is taking part in annual pay reviews and analysis and facilitating remedial action to address any concerns. This process, led by our Compensation team, is one of the things I truly admire about our company. I witness our pay fairness in action and take every opportunity to educate employees who want to understand more about their personal situation or our compensation philosophy and fair pay practices.
And while we know pay is important to our employees; pay equity is critical to our organization.
Union Pacific has a longstanding history of competitive compensation and pay equity practices and an unwavering commitment to diversity and inclusion. Our mission is to foster a workplace where all employees can perform at their highest levels and truly belong. We have long understood talent is best attracted and retained in a variety of ways, with competitive pay being a consistent leader. For years we’ve conducted an annual pay audit of our management employees that includes a critical pay equity review for both race and gender of salary and bonuses.
Equal Employment Opportunity (EEO) disclosures and pay scale disclosures – including publicly disclosing the results of our pay equity reviews -- all support our desire to show employees where we stand on this issue.
Pay Parity a Long Journey
What exactly is pay equity? It’s compensating employees performing equal or substantially similar work in a way that is not based on employees’ gender or other protected category characteristics, such as race or ethnicity. A “pay gap” is the differences between mean or median earnings between two populations.
For example, in the United States, women earn only 82 cents for every $1 men earn for doing the same work. A similar gap exists between what non-white employees are paid compared to what white employees are paid.
Pay parity can be an extremely long journey. According to the Pew Research Center, since 2002 women have been earning in the low 80 cents for every dollar a male earned, and have gained only 2 cents in 20 years.
Changing the Landscape
During 2021, we took steps to research third-party compensation experts, and in 2022 selected an incredible partner whose team worked very closely with us in reviewing the salary and bonuses of more than 5,200 of our management employees: 1,086 women (21%) 4,178 men (79%), 1,387 minority (26%) and 3,877 majority (74%).
The objective: Identify through statistical tests whether compensation gaps existed across gender or race at Union Pacific, and also whether we had programs or policies that created any pay inequities.
When the study was completed, we were elated that our third-party expert validated our equal pay practices. The pay equity review revealed our pay is equal across gender and race. “(At Union Pacific) There is no statistically significant variance in pay; men and women and people of color are currently paid within 1% of each other for the same job and similar job responsibilities.” Specifically, women earned 99.4 cents for every dollar that men earned. People of color earned 99.7 cents on every dollar that white employees earned.
This validated our commitment to employee pay equity and our pledge to foster a more diverse, equitable and inclusive workplace where our competitive compensation practices are transparent and employees can participate fully and equally in all aspects of our workplace programs.
Attracting and Retaining Talent Through Competitive Compensation.
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We understand competitive pay and transparency around that pay is critically important to the talent we are seeking. We participate annually in national benchmarking and salary surveys, which allows us to establish competitive salary ranges by comparable job groups, companies, inclusive of high-cost cities; making adjustments as necessary.
And despite our third-party validation, we recognize the work toward a zero-pay variance is never done. We will continue to assess our compensation programs, evaluating our pay equity – always reaching for a goal of 100%. At Union Pacific, we believe there is no other way to do business.
Read more about how we support and develop the Union Pacific team and our commitment to fostering a diverse and inclusive environment in the 2022 We Are One Report.