When you have a Conscious Culture, you have a culture that is built on a foundation of trust and transparency. A culture where everyone feels empowered to speak up and accountable to do what’s right. It is also where we learn from the past to foster our future.
In the spirit of transparency, I want to share that we recently resolved a nearly decade-old matter focused on pay equity for employees in our San Jose, CA office. The issue arose from an audit of our pay practices from 2011 to 2013 by the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP). OFCCP’s audit concluded that adjustments were needed in San Jose. Since that time, their audits of 22 other Cisco locations in the U.S. found no issues.
We of course believe in taking accountability to make things right for our employees. And we have agreed to pay a total of $2 million to 1,505 Hispanic, African American, and female current and former employees who OFCCP believes were adversely affected in San Jose during that period.
Since 2011, we have changed many of our practices. One of the biggest changes we’ve made is to have open and transparent conversations about what’s working and not working. This has allowed us to challenge everything we do and engage our employees in designing a more inclusive and conscious culture for all.
For example, in 2016, we built an innovative framework to test the health of our compensation system. At the time, most companies in the industry were focused on pay parity for only women or under-represented groups. We wanted pay parity for all. As a result, we widened the aperture to look holistically across gender globally plus race and ethnicity in the U.S.
Each year, for the past five years, we review pay equity in our second fiscal quarter then make the necessary adjustments for employees in our third fiscal quarter. We transparently communicate to employees why their pay has been adjusted and we’ll continue to do so. Based on these efforts, we have provided nearly $11.8M in pay equity adjustments and are committed to investing well over the $2.75M we have agreed to with the OFCCP over the next five years in the U.S.
Our People Power a More Inclusive Future
Conscious Culture isn’t something we say. It’s something we are.
In October when we were named the #1 “Great Place to Work,” our employees overwhelmingly agreed that people at Cisco are treated fairly regardless of their race and sexual orientation. We are tremendously proud of this feedback and our accomplishments over the last few years, but we also know that we are only as good as the last great thing we did. And we have more to do.
Our goal has always been to mirror the markets we serve. That’s what it means to create an inclusive and conscious culture. And what it takes for a world-class organization to excel in an ever-changing world.
We’ve come a long way over the last decade and it’s great to be recognized for our achievements. All of this tells us we’re making great progress towards building a diverse and inclusive team and a culture we can all be proud of. That work will continue. Our employees have that commitment.