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MI MINN2SOTA <br />Compliance Report <br />Explanations below correspond to shaded <br />numbers on page three. <br />1. Average Maximum Monthly Salary for <br />Employees in Male Classes <br />2. Average Maximum Monthly Salary for <br />Employees in Female Classes <br />3. Overall Average Maximum Monthly <br />Salary for an Employee <br />4. Underpayment Ratio <br />The minimum requirement to pass the <br />statistical analysis test is an underpayment <br />ratio of 80%. The underpayment ratio is <br />calculated by dividing the percentage of <br />male classes below predicted pay (item five) <br />by the percentage of female classes below <br />predicted pay (item six). In the example on <br />page three, 37.5 - 25 = 150%. Jurisdictions <br />with an underpayment ratio below 80% can <br />improve their score by increasing salaries <br />for female classes to at or above predicted <br />pay. More details regarding predicted pay <br />are on pages six through 13. <br />If the underpayment ratio is less than 80%, a <br />jurisdiction may still pass the statistical <br />analysis test if the t-test results (explained in <br />item 7) are not statistically significant. The <br />t-test measures the average dollar difference <br />from predicted pay for male and female <br />classes. <br />5. Percentage of Male Classes Below <br />Predicted Pay <br />This percentage is calculated by dividing the <br />number of male classes below predicted pay <br />by the overall total of male classes. In the <br />example on page three, the total of male <br />classes is eight, and three fall below <br />predicted pay. Therefore, 3 - 8 = 37.50%. <br />6. Percentage of Female Classes Below <br />Predicted Pay <br />This percentage is calculated by dividing the <br />number of female classes below predicted <br />pay by the overall total of female classes. In <br />the example on page three, the total of <br />female classes is four and one of those falls <br />below predicted pay. Therefore, 1 - 4 = <br />25%. <br />7. T-Test & Degrees of Freedom <br />These numbers are used only for <br />jurisdictions with an underpayment ratio <br />below 80%, at least six male classes and at <br />least one class with a salary range. If the <br />underpayment ratio is 80% or more, these <br />numbers are not used nor are they used for <br />jurisdictions in the alternative analysis. <br />These numbers show the average dollar <br />amount that males and females are from <br />predicted pay and answer the question: Are <br />females paid less than males on average and, <br />is the underpayment of females statistically <br />significant? <br />To determine if these numbers show <br />statistical significance, they must be checked <br />against the table on page five. Find the DF <br />number in the "Degrees of Freedom" <br />column and then look across for the "Value <br />of T." If the "value of t" on the compliance <br />report is less than the "value of t" on the <br />table, it means that either there is no <br />underpayment of female classes or that the <br />underpayment is not statistically significant. <br />If the t-test number is the same or more than <br />the "value of t" on the table, the <br />underpayment for female classes is <br />statistically significant and the jurisdiction <br />would not pass the test. <br />Salary increases for female classes sufficient <br />to eliminate statistical significance would <br />allow a jurisdiction to pass the statistical <br />analysis test even with an underpayment <br />ratio below 80%. <br />Guide to Understanding Pay Equity Compliance Tests — 10/16 Page 4 <br />