Megan Nail

▶0:01HostWelcome to the Built by People podcast, where we share the stories and insights of the world's top HR leaders. Join us as we dive deep into the minds of HR executives, uncovering their strategies, challenges, and triumphs in shaping today's workforce. I'm excited to welcome Megan to the Built By People podcast. Megan, thank you so much for joining us. And as a starting question, I always love to ask if you could tell us a little bit more about your career journey.

▶0:55GuestYeah, I would love to. So I'm a longtime, forever HR person, so I have really kind of focused in that human resource space. And I love how my career started because I really graduated in a pretty down economic time, and HR is not that easy of a space to get into. So I'm really grateful for my first job because I was a cashier at Target all during high school and college. And you never know where that job will lead you. They gave me my first HR job. So that's where I started off in HR and then kind of worked my way, mainly found my way into professional services. So doing HR and then eventually compensation in public accounting, large law firms. And I really found my love for compensation, but when you're working internally within a firm or a company or an organization, you're kind of working with one structure and I wanted to see more what was out there, different industries. So I joined NFP a little over 5 years ago and have been working on the consulting side of things ever since.

▶1:58HostWe're going to dive deeper into your category of expertise being compensation. And the first question I have around that topic is what steps do you take to ensure pay equity across different roles and demographics at organizations?

▶2:14GuestYeah, I think the first thing is it's really important to have a framework. So with a lot of the clients we work with, they don't have a structure or framework or ranges or any data to look back at. So if you're trying to ensure equity, you know, whether it's gender or race or ethnicity or whatever factor it is, performance, tenure, if you don't have anything that you're kind of looking at that central source of truth, it's really hard to do that. So that's usually where we start is having some market data. Putting some ranges together and then using that as really a way to compare so you can start to look things through a little more objective of a lens.

▶2:57HostCurious to get your perspective on how you approach communicating pay transparency to employees while maintaining trust and confidence.

▶3:05GuestYeah, I often say that even though compensation is not probably the only reason why we work, it's, you know, got to be right up there as a primary reason for most of us, even though we love what we do. I think unless we're in a volunteer capacity, none of us are working for free, but it is the most poorly communicated thing that I have seen in our work lives. So talking about money is uncomfortable, I think, for a lot of us. I think it's changing a little generationally, but thinking about just getting people comfortable with talking about what that data is and why they're paid what they are. And I think at the end of the day, people want to know that their pay is fair. I've never met anyone who didn't want to make more money or wouldn't be happy to accept a raise or something along those lines. But if they understand where their pay is coming from, I know there's, again, a process of framework behind it, some data, and then they know why they're at where they're at within that range, and it makes sense to them. And then they feel that's fair. They know what they need to do to move forward, like what goals, what do they need to achieve? Like what's their opportunity? I think those are the key points around compensation communication. It helps to build trust and confidence in the organization as a whole.

▶4:26HostWhat challenges have you faced in implementing pay equity initiatives and how have you overcome those challenges?

▶4:33GuestYeah, pay is usually the top, you know, usually the top, at least the top 3 out of expenses that a business has, right? Or that an organization has. So I usually— one of the biggest challenges that I come across is budget. We maybe we want to pay more, we want to address some of these inequities, but it's a really costly proposition and we just don't have the budget or the financials to do it. So I think with that, like ways to overcome that are to think about things in steps. So you might— it might not be possible to do everything at once. With a lot of our clients, it's not. They're looking at things over a 2 to 3 year timeframe. And then back to your question about trust and transparency, be transparent with your employees that, you know, our budget's only going to allow us to go so far with this this year, but then we hope to do more adjustments in future years. And honesty, I think, is really helpful and helps to overcome a little bit of that budget challenge.

▶5:34HostAnd how does pay transparency influence things like employee engagement and retention?

▶5:41GuestI think it's a really big factor in employee engagement and retention because, I mean, just having been in HR for a long time, I mean, people make up reasons in their head if they don't know, if we don't help to fill that void or really share that why. And pay is no exception. I mean, again, it's a big part. You're looking at your pay stub every week or every other week or whatever it is for you. And really trying to understand why it is. When you see things on the news about, you know, unions negotiating 46% increases or inflation at an all-time high, we as employers really need to kind of step in and fill that void of knowledge so that our employees can at least be engaged. And again, even if it's not maybe what they hope for, they understand it. And I really think that that helps with that engagement and morale. Another thing that I often see that I think is really detrimental to engagement, it really brings down managers' credibility, is if we don't equip our managers with any information about pay or very limited information, and employees come to them, the person they trust most, their supervisor or their manager, and that person can't answer any questions, even a, you know, a basic question about it, because we haven't shared that information And it's been guarded either at a leadership level or in HR or in finance, whatever the case may be. So I think let's help them, equip them with some, you know, at least general information so they can start to build that trust, even if they can't answer all the details.

▶7:19HostMegan, what role does data play in driving decisions around pay equity and ensuring fairness in compensation practices?

▶7:29GuestYeah, pay equity is a huge topic. It's been a huge topic for many, many years, but it's, you know, it continues to come to the forefront. You see studies that come out every year. It's me— a lot of it is gender driven, and then it's also compounded by other factors such as race and all different types of demographic factors. So data is important. I think it's starting with market data around pay, building that framework, building those ranges. But then beyond that, really thinking about the guidelines for how decisions are made, because we can have a great plan and great data, but if we have a bunch of different leaders and managers who are using that data differently and making different decisions, they are probably not out there looking to pay inequitably. But if they don't have guidelines to go by, you know, you have this manager who really wants to pay everyone the same and pay them really high, someone else who differentiates a lot on performance or some other factor. So we have to think about it. So it starts with data and then also guidelines. And then I think data again on the back end of it, of really doing, you know, your statistical analysis to really make sure— pay equity analysis— that we're not inadvertently— again, I hope nobody's doing this on purpose— but that we're not inadvertently, you know, having any outcomes that we didn't expect and we have any pay disparities. And there's real easy statistical things you can look up. You can do a regression in Excel. Excel can do a lot of the work. All the way to there's great computer assistant, you know, softwares that are out there and HRIS systems that have things built in that can help with that as well. So kind of looking at it on the front end with your data, but then also looking at it on the back end just to make sure nothing happened that we didn't intend.

▶9:18HostMegan, any parting advice you'd like to share with our audience?

▶9:22GuestYeah, I think definitely education around compensation is really important. So kind of consume that information, really understand what it is. If you're looking for data, there are lots of great, again, companies out there that offer all kinds of compensation data. But if you don't have budget and you're looking forward to, you know, getting something started, the Bureau of Labor Statistics is a great source. It's already paid for. So is something that's just free, that's out there, that is a good source of data to use. So I think my main advice is learn more, engage, because it can really have a transformative effect on employees, their trust, their morale, and engagement at your company.

▶10:06HostMegan, thank you so much for joining us on the Built by People podcast. It was a pleasure having you involved.

▶10:11GuestGreat. Thank you so much.