For nonprofits and small businesses, every dollar matters-and so does every employee. In today’s workforce, fair pay or pay equity is a smart business strategy. Rather than just a compliance checkbox, pay equity is a defining element of organizational culture, trust, and long-term success. As transparency becomes the norm and employee expectations evolve, leaders are facing growing pressure to ensure compensation practices are not just legal but truly fair. At the Consonance Group, we work with mission-driven organizations to build and implement pay equity practices that are realistic, compliant and aligned with your values.
The Current Landscape: Progress with Persistent Gaps
Despite growing awareness and action, the gender pay gap remains a reality. In 2025, women earned about 85 cents for every dollar earned by men-a modest improvement from the 81-cent disparity in 2023. The gap widens significantly with age and for women with children who face a “motherhood penalty” even while men often receive a “fatherhood bump” in pay. State-level changes have accelerated momentum in addressing the gap. Many states now require employers to disclose salary ranges and benefits in job postings. While federal mandates remain limited, pay audits are emerging as a best practice-both for compliance and in demonstrating a genuine commitment to equity. “Only 5 percent of companies excel at pay equity. The rest are missing a key opportunity to drive innovation and better results.” –Josh Bersin, Human Capital Analyst, August 2024
Transparency and Scrutiny are Here to Stay
In 2025, nearly 80 percent of employers reported posting salary ranges in job listings even as reporting implementation varies widely by region. Despite this advancement, about 35 percent of employers have not conducted a pay equity audit, missing a vital opportunity for risk management and for building trust in the company culture. Another 34 percent fail to consistently tie pay to performance, a key contributor to pay disparities when left unchecked. Employers that conduct pay equity audits, with legal counsel to protect privilege, are addressing a compliance measure while creating a strong defense against pay-related legal action.
The Cost of Inaction: Legal and Reputational Fallout
Recent lawsuits-including those involving high-profile organizations like Disney, Google, Mastercard and the University of Denver-underscore the cost of inaction. The Dallas Cowboys Cheerleaders recently won their pay equity lawsuit along with a 400 percent pay increase. These cases revealed recurring issues: overreliance on prior pay, bias in hiring and promotions, and failure to act on internal audit findings. Settlements involved hiring outside consultants, labor economists and psychologists to review HR practices. In addition to the financial costs and penalties, the lawsuits sparked internal mistrust and damaged public perception and the reputations of the organizations.
Pay Equity is Good Business
Organizations that lead with fairness don’t just avoid lawsuits, they earn loyalty. They reduce turnover. They attract mission-driven talent. And they build a resilient, inclusive culture that reflects the values they seek to advance. Pay equity is a strategic asset. Employees want to work where they are valued and treated fairly. Candidates are increasingly choosing employers who lead with transparency and act with integrity. A proactive approach to pay equity delivers:
- Risk mitigation: Reduces legal and reputational exposure.
- Stronger culture: Builds trust, morale, and engagement.
- Talent advantage: Attracts and retains top candidates.
- Competitive advantage: Strengthens reputation with funders, clients and community.
- Brand protection: Aligns compensation with organizational values and public commitments.
Building a Strategic Roadmap to Pay Equity
Pay equity is not the sole responsibility of HR. It’s a strategic, organizational commitment of conducting audits, acting on findings and keeping strong internal controls that must be owned across leadership, finance, legal, operations and HR. The process includes the proactive practice of staying updated on state laws and evolving best practices to ensure a fair pay business culture. The Consonance Group will guide leaders through a human-centered, data-informed approach to achieving and sustaining pay equity. Key Actions for Client Work:
- Conduct Annual Pay Equity Audits: Partner with legal counsel to ensure audits are protected. Use findings to inform structural changes, not just reporting.
- Educate Leadership: Pay equity is strategically tied to talent retention, engagement and brand reputation, not just compliance.
- Review Hiring and Compensation Practices:
- Eliminate prior salary history as a factor in offers.
- Be consistent in leveling skills and in performance pay decisions.
- Support Transparency: Post salary ranges and benefits to build trust and reduce bias even if not legally required.
- Monitor Demographics: Examine disparities across gender, race, ethnicity, and parental status.
- Shift the Mindset:
- Equity is a continuous, ongoing strategy and not a one-time fix.
- Stay current with evolving state laws and industry expectations.
The future of equitable work is being shaped in mission-driven organizations that value fair, transparent compensation strategies. Those that act now, rather than react later, will attract the best talent, build enduring cultures, and emerge as leaders in a new era of work.
A big thanks to the Constangy, Brooks, Smith & Prophete for their recent webinar, Pay Equity Report Card. Their insights provided the information and inspiration for this month’s blog post.