Pay Equity and the Power of Collective Decision Making

Posted by ArtsPool Services, Jul 14, 2020 0 comments

Like many organizations, the financial impact of COVID-19 forced us to face tough decisions about salaries and employment. When it became clear that ArtsPool might need to implement pay cuts, our decision-making was aided by the previous investment we made in addressing the inequities of our pay structure. As a result, we were able to have difficult but open conversations as a full team about how to come to an equitable solution that takes into account the needs of the organization, as well as the differing circumstances of each individual.

We believe these efforts have positioned us to make better, more equitable decisions as an organization during regular operations as well as during times of crisis. While there is no single model for creating an equitable workplace, we offer our transition story as a conversation starter for other organizations who are interrogating their own staffing structures.

Background

ArtsPool was founded in 2014 with a goal of helping the arts field operate in a more sustainable manner through collective resource sharing. Noticing a lack of capacity for finance, workforce, and compliance work in the field, and high staff turnover in these areas, we were founded to serve as a shared back office for several nonprofits who wouldn’t otherwise be able to retain talent.

We started with a two-tiered model of “managers,” who delivered finance and workforce services while also managing ArtsPool’s operations, and “associates,” who did bookkeeping and payroll processing. As time went on it became clear that the success of ArtsPool’s model relied equally on both tiers of staff, both for service delivery and the strategic design of our young organization. The pay disparity became increasingly uncomfortable. ArtsPool struggled with how to make fair decisions about merit-based pay raises; these decisions felt counterproductive to the sustainable culture we were trying to create. ArtsPool also had an all-white staff and began to actively address equity in our culture. Now, motivated by the organization’s own desire to retain talent, ArtsPool knew its compensation structure—and culture—needed to change.

The Process

Photo by Jon Tyson on Unsplash.ArtsPool was fortunate to receive a New York Community Trust grant funding a partnership with Piper Anderson of Create Forward to address our culture concerns. After an initial anti-racist training, ArtsPool formed a DEI team and embarked on a process inspired by the Canadian Government. Anderson conducted one-on-one interviews with all employees to gain input from stakeholders on how compensation would be most equitably structured at ArtsPool.

The interviews revealed that prior experience in the field, which privileges white, wealthy candidates, is less important to our success than knowledge of ArtsPool’s operations, which are distinct from how traditional finance and HR departments function because of our unique cooperative, systematized model. From this process ArtsPool designed a structure that would increase compensation as well as job responsibilities to workers with tenure at ArtsPool, rather than to those with specific prior experience.

The New Structure

After considering a variety of scenarios, ArtsPool created a tiered salary structure with a single starting salary for all employees, and equal pay raises after each additional year of employment, up to a defined ceiling. Each pay raise coincides with additional responsibilities, such as the ability to become a team lead, join the cooperative as a co-owner, or serve as a governance representative. The “manager” and “associate” titles were eliminated: all employees share equal responsibility for delivering services to members and serving on one of ArtsPool’s operational teams.

Since launching the non-hierarchical structure ArtsPool has had little employee turnover, increased racial diversity, and implemented better collective decision-making processes. However, we continue to experience challenges. We struggle with defining decision making structures and recognize that informal hierarchies still emerge. We believe pay equity is not the end product; rather, it is a structure which provides important financial stability, allowing us to address other power dynamics within the organization regularly and without the limitations that many employees feel in a traditionally structured workplace.

Pay Equity in Moments of Financial Crisis

Recently when it became clear that pay cuts might be necessary, we gathered as a full team to discuss the scope of the financial impact to ensure everyone had the necessary context for decision-making. After reviewing a variety of scenarios, each employee filled out a survey to confirm what was most important to them as ArtsPool considers cuts. The survey asked if employees would prefer equal cuts across the board, a progressive model with higher cuts for higher salaries, or a model which takes into account other equity factors such as childcare responsibilities and medical needs. Employees were also asked to share how much of a cut or furlough they were personally able to afford. There was some variance in the responses, including when to trigger salary cuts and what an equitable pay cut rubric would look like. While this raised more questions, it also allowed for employees to be honest and pointed to a continued examination of our decision-making process.

Thanks to the Paycheck Protection Program, ArtsPool has not needed to implement the results of this survey. But if we do need to implement them, we will be in a strong position to stay financially secure, without causing the significant distress that can arise from a hierarchy where one person is making decisions about others’ financial security.

ArtsPool believes that by engaging in transparent, collective decision-making we are building shared responsibility for our choices as an organization, which leads to greater happiness and employee retention in the long run. The pay equity structure provides the base of transparency and financial security required to make better, more equitable decisions—during regular operations, as well as during times of crisis.

Please login to post comments.