In anticipation of potential litigation, a large retail company retained Welch to audit its pay practices, focusing primarily upon pay differences between male and female managers.  We began by examining simple unadjusted comparisons which remove the effect of only the most basic of factors.  This result mimicked what the client might have faced in an initial assessment by an adverse party.   These data showed that females were paid 12.5% less than male employees in the same job and with the same number of years of experience.

Continuous communication with the client allowed us to improve our statistical models to account for additional factors relevant to the determination of pay and to make the comparisons more meaningful.  Using the preliminary data, Welch provided evidence that differences in the scope of employees’ assignments and the quality of their prior work history were important determinants of their pay and worth pursuing as factors that could potentially explain the initially observed pay gap.

The company then provided detailed data on employees’ assignments and we assisted the client in selecting and utilizing a random sample of applications from which we could obtain information about prior work histories.  We found, as the preliminary evidence suggested, that assignment and prior work information helped to explain a very significant fraction of the initial pay disparity.