Lululemon Achieves Equal Pay for Women
Apr 10, 2018
In the wake of the Women's March last year, executives at lululemon felt like they had to do something. So two weeks before International Women's Day, leaders at the athletic brand sat down in a conference room to discuss how they were going to celebrate their female employees on that day.
One fact shocked and frustrated the room: If the U.S. continues to close the wage gap at the current rate, pay equity will not be achieved until 2059, according to the Institute for Women's Policy and Research. Women of color will have to wait even longer.
"That year is if people don't take a stand. And we said that's just not acceptable," says Celeste Burgoyne, lululemon's Executive Vice President for the Americas and a MAKERS@ Board Member. "For us, that year was going to be 2018."
On March 8, 2017, executives announced internally that the brand was doubling down on one big goal: lululemon will promise its employees equal pay for equal work by the end of 2018.
Fast forward 13 months and lululemon has achieved just that—and ahead of schedule. As of April 2, the Vancouver-based activewear brand reached 100 percent gender pay parity for its 14,000 employees worldwide. In total, it's a multi million-dollar investment the brand has put into its workforce.
In February, Burgoyne took the stage at the 2018 MAKERS Conference to publicly declare the brand's initiative as one of 40 MAKERS@ partners who pledged to advance women in their companies. That announcement, however, came at disruptive time at lululemon. Just two days prior to Burgoyne's appearance at the MAKERS Conference, the company's CEO resigned and the brand released a statement explaining, "lululemon expects all employees to exemplify the highest levels of integrity and respect for one another, and Mr. [Laurent] Potdevin fell short of these standards of conduct."
Since then three executives have taken the lead as the brand searches for new leadership: Stuart Haselden, Chief Operating Officer and Chief Financial Officer, Sun Choe, Senior Vice President of Merchandising and Burgoyne, who stayed committed to achieving pay parity at the company, where women make up 75 percent of the overall workforce and comprise 90 percent of the employees in their retail stores.
In an exclusive interview with MAKERS, Burgoyne discusses delivering on lululemon's pay parity promise, navigating the public announcement at a tricky time, and what she and her colleagues hope to achieve for their employees going forward. "We know there's more we can do," says Burgoyne. "This is just the beginning."
Tell us how this initiative started. When did you decide to make pay parity a priority?
CB: Last year, after the Women's March, the topic of International Women's Day was a pretty monumental conversation around the world. About two weeks before IWD, my team and I were talking about how we wanted to show up for our people on the day. As we were discussing what we might do, the thing that stood out the most to all of us was that, if we and other companies were to do nothing, women would not see pay equity for another 40-plus years. That troubled us. We value women in an extreme way. In many ways, we're an organization that has been built for women, by women, and we feel really strongly in women's ability to transform not only lululemon but also the world. We weren't okay being a company that existed with any pay gap. So we made a commitment. We didn't know where we stood; we didn't even know what the gap looked like. But we knew the right thing to do was have 100 percent of our people paid for equal work. And we were going to try to do it by the end of 2018. Our CEO, our head of People & Culture and I spoke, aligned and got the team onboard. It was an easy conversation to get people rallied behind.
On Feb. 5, lululemon announced that its CEO was resigning because he "fell short ... of [our] standards of conduct." Just two days later you were at one of the biggest feminist conferences of the year to make your announcement. Why was that important for you to follow through on?
CB: At the start of the week, with the departure of our CEO, our responsibility as leaders was to make sure our teams had confidence in the business and understood the decision. We held an all-hands meeting with employees and followed up with conference calls with teams around the world in their time zones. Within 24 hours, we had spoken with everyone to ensure our employees had the opportunity to ask any questions they had and felt supported in this moment of transition. My fellow transition leaders and our Executive Chairman were completely supportive and very encouraging that I keep our commitment and appear at MAKERS. Joining such amazing leaders on stage and sharing our pay equity pledge was about more than any one person. I was on stage representing the 14,000 employees of the lululemon collective, more than 75 percent of whom are women. It was inspiring; it helped us all move forward and look to the future without missing a beat.
You said you hadn't even crunched the numbers yet when you committed to this goal. And yet you closed the pay gap ahead of schedule. How did you achieve this so quickly?
CB: Yeah, we had no idea. Basically we worked with an external firm, Willis, Towers, Watson, to do a full review of the company globally. We're in more than 12 countries worldwide, and we have 14,000 employees. What we found was that, across our stores, employees were already being paid the same rate. We were proud of that. We did, however, find a small pay gap at our store support center [lululemon's corporate headquarters]. From there it was on us to determine how to close it. [lululemon declined to reveal specific figures.] We committed to doing it by the end of 2018, but actually closed it six months earlier than planned. As of April 2, all our employees, male and female, are being paid equally for equal work.
What's the feedback been inside lululemon?
CB: So powerful. I myself have received multiple emails and notes of gratitude. Our Head of People & Culture was in a couple meetings today and had a couple of situations in which people had tears of joy and gratitude in their eyes. For many, hearing the commitment about pay equity was one thing, but hearing they received a salary increase – and got a merit raise on top of that –brought it home. It was a moment of unity, one for all.
On a personal level, what has making good on this promise meant for you?
CB: I've been with lululemon for 11 years. We set big goals and make things happen quickly, and our commitment to our people resonates in those decisions that we make. Leading an organization where the staff is 90 percent female in stores, I feel like it's my duty and our duty to give equal pay for equal work. That we were able to make that commitment quickly and deliver on it makes me feel really even more proud. We hope this is the beginning of a journey that will continue to put our people first and make sure that we're doing the right thing.
So what does that look like? How are you going to expand on this endeavor?
CB: This year we have been really focused on gender pay equity, but we're also embarking on work to bring our culture to an even higher place in terms of inclusion and diversity. We're working on what our next commitment is.
How else are you and your colleagues planning on making sure women are supported and elevated at lululemon?
CB: Being at 50 percent male-to-female at the director level and above we feel really happy with. Also, since our CEO departed, two of the three of us transition leaders are women. We're really proud of that as well. As we dig in I know that there's more we can do. This is just the starting point for us. And I couldn't be more proud of where we are.
*Interview has been edited and truncated for content and clarity
For more about lululemon and other companies making pay parity a priority, tune in April 10 at 2:30pm ET to the MAKERS Equal Pay Now Live Q&A on MAKERS.com and @MAKERSWomen on Twitter.