Google found it was underpaying more men than women for similar jobs

Key Points
  • A new internal analysis at Google found that some male software engineers were under-compensated compared with their peers doing similar work.
  • Google has made adjustments for 10,677 employees totaling $9.7 million, although its unclear how much of that money was awarded to men.
  • Google has faced multiple claims of pay discrimination against women. The company said it will conduct a comprehensive review of other factors that can impact wage discrimination.
Google CEO Sundar Pichai
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In an effort to address wage equity among women and members of minority groups, Google studied its own practices as it does every year. But the results showed the company was underpaying more men than women for doing similar jobs in software engineering.

Google compensated 10,677 employees an extra $9.7 million to offset the underpaid wages found in the study, the company wrote in a blog post, though it's unclear what percentage of those recipients were men. In 2017, Google said it increased compensation for 228 employees it found were underpaid, spending a total of about $270,000.

Google's 2018 analysis found that in one group of lower-level software engineers men "received less discretionary funds than women," according to the post authored by Google's lead analyst for pay equity and people analytics, Lauren Barbato. Nearly half of the adjustment fund was spent on discrepancies in offers to new hires, Barbato wrote, which was the result of a new hire analysis Google conducted in the 2018 study.

Google outlined its methodology for the report, saying it runs statistical analysis to "look for unexplained differences in total compensation (salary, bonus, and equity) across demographic groups." Google analyzed every job group with at least 30 employees total and at least five per demographic group. The analysis included 91 percent of Google employees.

Google's findings come after the company has had to grapple with difficult issues around gender equity in the workplace. Thousands of Google employees worldwide walked out of offices in November after a New York Times report surfaced a $90 million exit package paid to ex-Android leader Andy Rubin after the company found sexual misconduct claims made against him credible.

Employees used the moment to speak out about their own experiences with sexual harassment in the workplace and pressured Google to end the practice of forced arbitration in cases of harassment and discrimination, which prevents employees from taking those claims to court. Google responded to employees by pledging to make arbitration optional in these cases.

Google's study, however, is limited to a specific type of pay equity and does not take into account other factors like leveling, which considers whether new employees are paid appropriately at the outset of their career at the company.

Barbato addressed other factors in the blog post, saying, "Our pay equity analysis ensures that compensation is fair for employees in the same job, at the same level, location and performance. But we know that's only part of the story. Because leveling, performance ratings and promotion impact pay, this year, we are undertaking a comprehensive review of these processes to make sure the outcomes are fair and equitable for all employees."

But the study is likely to reignite conversation around bias at Google that came to a head when former engineer James Damore was fired after sharing a memo arguing differences in pay between genders was not due to bias alone, but also biological differences. Damore later filed a proposed class-action law suit against the company in January 2018 claiming discrimination against employees for political views, "male gender" and "Caucasian race."

Google is already facing scrutiny over gender discrimination through a class-action suit in California claiming the company underpays women and an investigation by the U.S. Labor Department into the company's compensation practices.

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