How to Read a Pay Equity Audit: A Job Seeker's Guide

Pay equity audits are becoming standard practice among top-ranked companies. But understanding what they reveal — and what they hide — requires knowing what to look for.

What a Pay Equity Audit Measures

A comprehensive audit examines compensation differences across:

• Gender (controlling for role, level, tenure, and location)
• Race/ethnicity (same controls)
• Age (same controls)
• Intersectional groups (e.g., women of color)

How to Read the Results

The Adjusted Gap — This is the most important number. It shows the pay difference after controlling for legitimate factors like role, experience, and location. A gap of less than 1% is considered "at parity." Gaps of 1-3% are concerning. Gaps above 3% indicate systemic issues.

The Unadjusted Gap — This raw number shows the overall difference without controls. A large unadjusted gap (even with a small adjusted gap) may indicate representation issues in senior roles.

Remediation Actions — Look for specific dollar amounts invested in closing gaps, not just promises to "continue monitoring."

What Our Data Shows

Among our top 100 companies:

• 78% publish annual pay equity audits
• Average adjusted gender pay gap: 0.8%
• Average adjusted racial pay gap: 1.2%
• 92% have dedicated pay equity budgets

Among our bottom 100 companies:

• 12% publish pay equity audits
• Average adjusted gender pay gap: 4.7%
• Average adjusted racial pay gap: 6.3%
• 8% have dedicated pay equity budgets

Red Flags

Be cautious of companies that:

• Report only unadjusted gaps (which can be misleadingly small)
• Exclude certain employee populations from the audit
• Publish results without remediation commitments
• Haven't conducted an audit in more than 2 years