This HR concern got international attention
when data from GM indicated that new CEO Mary Barra would earn just $4.5 million, compared to her male predecessor’s $9.1 million. However, these figures included just the salary of $1.7m and short-term incentives of $2.8m.
In an effort to stop the allegations of inequity, GM released the full figures, which were originally being held until April, showing that Barra’s long-term earning potential works out to $14.4 million a year – almost 60% more than predecessor Dan Akerson.
Details are not available about how the non-salary portion of $10 million will be decided or awarded.
The company said it released the numbers ahead of its April proxy filing to "correct misperceptions created by comparisons that used only a portion of Barra's overall compensation."
CEO pay has been a controversial area for many top companies and one of the big issues is communication about why a CEO earns as much as they do.
“HR have to get better at disclosing the correlation between pay and results,” RBC SVP of Leadership and Organizational Development Helena Gottschling told HRM. “Being really clear on why we’re paying what we pay, how we’re doing relative to the goals we set for the organization and being clear upfront about what those goals are and how they’re tied to compensation.”
Pay inequity is a big issue for HR, especially when major Canadian employers such as Canada Post face multi-million dollar payouts over decades of gender inequality. When combined with the already controversial area of CEO pay it becomes an explosive issue, as General motors discovered this week.