Gender pay gap reporting has focused the minds of employers. Executives who have ignored diversity issues for years are suddenly having to explain what they’re going to do about their pay gaps. The gender agenda has gone from a nice to do, to a must do.
Whilst the first set of data published showed the consequences of many years of neglecting gender issues in the workplace, the second we hoped would provide an indicator of how employers were attempting to change.
It was quickly established that the bulk of the pay gap wasn’t to do with unequal pay, despite the media repeatedly conflating the two, but unequal jobs. Women dominate low paid jobs, and men dominate high paid jobs. This isn’t something we expected to see change in twelve months, and it would of been an unrealistic objective for any employer to set. However, another of the reasons behind most pay gaps is the increasing proportion of men in roles as one moves up the organisation. This reason is one we hoped to be challenged and employers can make impact on this contributor to their pay gaps by finding and eliminating the barriers to women and progression.
Analysis of the second round figures has shown that the overall median pay gap in favour of men decreased slightly from 9.7% to 9.6%. However, across 45% of firms the discrepancy in pay increased in favour of men, while at a further 7% there was no change, meaning 78% of companies with 250 plus employees pay men more than women. Although disappointing, the results highlight that there is no quick fix, and structural inequalities to pay can’t be done overnight.
Whilst every organisation is different, we can confidently say that one of the barriers will either be a lack of flexible working options or unconscious bias and in-groups.
To gain a better understanding of the cause of their pay gap, organisations should assess where barriers impede both the recruiting of diverse talent and equally the retention of diverse talent. There are numerous initiatives organisations can implement to help tackle these barriers, such as general positive action, mentorship schemes, development programmes and returnships. However, not all interventions will work for all employers. Therefore, they should be applied to meet the individual needs of the organisation.
Moreover, to effect structural change it is important for organisations to undertake an honest appraisal of their culture. This is key as it can either promote the actions to increase inclusion or it can serve to be the leading obstacle to it. Additionally, it is vital to revaluate policies such as maternity and paternity leave, subsidised childcare, and flexible and agile working.
Going forward it is critical for employers to submit a narrative alongside their figures, which includes an action plan. Although this is not a legal requirement, it is extremely important for organisations to explain the reason for their gap, and to show the steps they plan to take to tackle the problem.