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Mind the pay gap

Pepi Sappal

Pepi Sappal on closing the gender pay gap

British actress and activist Emma Thompson recently said that equality between men and women was “way, way overdue”, and that she did not want to die before the gender pay gap (GPG) closed.

We all agree. “Women are better educated and better qualified than ever before, yet their skills are not being fully utilized – especially the 40+ age group,” says Rachel Suff, Public Policy Adviser at the CIPD. “Although much has been done over the last few decades to close the GPG, currently hovering around 19.2 per cent – and estimated to be worth £600bn to the economy – progress has slowed considerably.” According to the World Economic Forum, the GPG across health, education, economic opportunity and politics has closed by only 4 per cent in the past 10 years, suggesting it will take another 118 years to close completely.

Progress has stalled for several reasons. “For starters, occupational segregation is still deep rooted in our society, and women continue to be under-represented in the more lucrative STEM sectors,” says Anna Ritchie Allan, Manager of Close the Gap in Scotland. According to TUC statistics, nearly 13,000 men started engineering apprenticeships compared to only 400 women in 2013. “This can’t be fixed overnight,” says Allan. “It needs to be tackled through early intervention programmes to encourage young girls to choose these careers.”

Pay discrimination, although illegal, continues to be a problem too, and the introduction of tribunal fees is making it harder for women to address it. “The fee was introduced to deter nuisance cases, but it seems that viable cases are now being deterred as claims have fallen by 80 per cent,” points out Jemima Olchawski, Head of Policy and Insight at the Fawcett Society, a leading charity promoting gender equality and women’s rights.

Balancing caring responsibilities with work is still preventing women from progressing into senior roles. “EHRC statistics reveal that approximately 54000 mothers a year leave their job early as a result of being fired, made redundant or treated so poorly that they choose to leave after they become pregnant or give birth. That figure has doubled over last 10 years,” says Allan. “And if they do return, they often end up stuck in a part-time role with little room for progression, simply because it offers more flexibility.”

So more support is needed to encourage mothers back to work. Olchawski believes that “workplace attitude towards women would change if more was done financially to help dads share parental responsibility. Encouraging more senior level male managers to take parental leave would also provide mothers returning to work with a more equal footing in career progression.”

In a bid to close the GPG within a generation, former PM David Cameron last year announced legislation that will obligate employers of 250 or more staff to publish GPG data. It is scheduled to become law in October 2016, with the first of the submitted data to be published by April 2018.

Although the legislation is a welcome move, it’s not enough to achieve significant change, say the experts. The current threshold of 250 employees, for example, only covers 34 per cent of the workforce and excludes smaller firms, which tend to have larger gender pay gaps, especially those employing between 20-99 employees according to recent ONS statistics. So more needs be done to encourage SMEs to tackle it.

“Ultimately, the proof in the pudding will be what action firms take after they collect the data,” says Allan. “Although the legislation will only require firms to publish GPG data, it will need to be analysed if firms realistically want to rectify any gap.” For example, “if 50 per cent of your yearly graduate intake is female, then are 50 per cent progressing into senior ranks? If not, you need to ask why, and use the analysis to develop an action plan to fix it,” recommends Olchawski.

Of course, depending on sector, a high GPG may affect your employer brand/ reputation, as well as your ability to recruit/retain staff, and potentially attract adverse press, and even lawsuits. “So, if your company does have a high GPG, it will be vital to communicate to your staff that you are doing something about it, and working on a policy to fix it,” advises Jo Bond, a London-based international Leadership Coach.
 
“When GPG data becomes available it will certainly give women more ammunition to deal with many workplace inequalities,” says Jenny Garrett, Founder of Reflexion Associates, a leadership and coaching consultancy. “Closing the GPG is not just about equal pay, it’s also about equality in hiring, bonuses and progression too. Often people are promoted as a result of line managerial discretion, and inherent subconscious biases can influence whether a woman is hired/promoted. So it’s essential to tackle issues like this by providing training for managers responsible for recruitment/progression.”

As well as increasing transparency in hiring and succession planning, “it’s vital to increase quality part-time or flexible senior opportunities for women returning after a break. And we need more role models demonstrating that it is possible,” adds Garrett. In fact, “very senior level staff at investment firm Black Rock, for example, work a four-day week, and the firm is known to have promoted women whilst on maternity leave, alongside having stellar women’s leadership programmes that empower women with practical skills and development to help them get ahead and ensure the best talent is retained,” says Bond.

Smart firms like Black Rock aren’t waiting for GPG legislation to kick in, but taking action now to rectify it. The University of Essex, for example, recently announced a one-off pay hike for female professors to bring them into line with male colleagues. “Accenture too has pledged to grow the percentage of women hires to at least 40% worldwide by 2017,” says Tony Horan, Accenture’s UK and Ireland Lead for Human Capital and Diversity. “We have a number of initiatives in place which focus on recruitment, learning and development to empower female talent and progression for our people.”

In fact, according to Accenture’s ‘Getting to Equal’ research, “if organisations remove many of the barriers that prevent women from progressing in their careers and have more flexible working hours, the GPG could be closed by 2040,” concludes Horan. So, with any luck, Emma Thompson may well see the GPG close significantly during her lifetime.

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