Employees in India believe their companies pay external hires and favourites more and there is no pay parity in organisations for the same role and level.

Despite pay-for-performance motto, India Inc. is blamed for playing favouritism at work for pay parity at the same level. These findings were found in a recent survey by JobBuzz.in, the employer rating platform from TimesJobs.com.

The pan-India JobBuzz.in survey validates 975 responses from working professionals across experience levels, to find 90% employees working at the same level in their own company had different pay packages.

Nearly 40% of the professionals feel this salary disparity is due to external hires being paid more while 35% say it is due to favouritism by managers. Only 5% reason the disparity is the result of better individual performance.

“Salary disparity is a highly sensitive subject across all experience levels. Employers need to address aberrations and correct misperceptions tactfully as these directly impact employee motivation, performance, productivity and loyalty,” says Vivek Madhukar, COO, TimesJobs.com.

Levels of Pay Gap

Comparing salaries with colleagues in the same level within their own organizations, the survey reveals, 21% employees feel that there is more than 30% difference in salaries among people working at their level while 27% feel that there is a 20-30% salary disparity in their own companies.

Most employees (34%) report a 10-20% difference in salaries of others with the same rank as them. Only 18% respondents say that the disparity in their company’s compensation packages for the same level is below 10%.

See: India Inc HR Heads Shifting Loyalties to Seek Newer Greener Pastures

In an attempt to find perceived disparity in salaries of managers and their reportees, the survey findings reveal significant discontent among the subordinates. Almost 76% feel dissatisfied with the high disparity in pay between them and their supervisors. Over 38% respondents feel the pay gap was more than 40% while 26% say it is between 30-40%. Nearly 21% report the difference is between 20-30%.

Male vs Female Pay Disparity

95% of male respondents and 79% of the female respondents feel other employees working at the same level in their company had significantly different pay packages.

Shocking but true, many employees feel there is still a significant salary disparity between the genders for the same profile. Nearly 43% employees say there is a considerable difference in the salaries paid to male and female employees for the same role and level in their organizations.

Nearly 25% respondents held that the level of salary disparity between male and female employees ranges between 10% and 20%. And 21% employees feel there is 20-30% disparity between male and female employees. Another 7% employees say the disparity is higher than 30% in their own companies.

Madhukar added: “It is essential for companies to conduct salary-benchmarking surveys and correct actual and perceived inequalities in compensation among their workforce. This will help them meet employee expectations and significantly improve performance and motivation levels.”

Also read: How to Develop a Competitive Pay Practice?

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