Finally the UK government is demanding transparency from UK businesses in terms of pay figures for men and women, in a welcome effort to raise awareness of the gender pay gap that exists across all sectors of industry. And, assuming these businesses want to do the commercially and ethically sensible thing and reduce their gender pay gap, Equal Talent are here to help them. We have prepared a white paper to help these businesses understand the complexities of this challenge, and the ways in which Equal Talent can help to ‘de-bias’ the workforce and create a more diverse and inclusive culture.
What Is the Gender Pay Gap?
The gender pay gap is the difference between the average hourly earnings of men and women. You’ll usually see it expressed as a percentage of men’s earnings, so if the pay gap in a company is 50%, it means the women are earning half what the men do. According to the Office for National Statistics, men across the UK earned 18.4% more than women in 2017.
The gender pay gap isn’t the same as equal pay. Since the introduction of the Equal Pay Act in 1970, updated in the Equality Act 2010, it’s been illegal not to pay men and women the same amount for doing the same job.
So, a company might have a gender pay gap if a majority of male employees are in top jobs, even though they pay men and women the same for similar roles.
Although the overall picture in the UK is bad enough, in STEM the situation is far worse. In this sector, an Accenture study found reported levels of “extreme inequality” of pay. And we may be about to uncover more details of pay inequality in STEM with the introduction of new reporting requirements.
By 4 April 2018 (or 30 March 2018 in the public sector), any UK company with 250 or more employees was obligated to calculate and publish their gender pay gap on a government website. Alongside the numbers, organisations could explain their calculations, too. It was a chance to say why they have the results they do and what they’re doing to address a gender pay gap, if one exists.
The numbers published are truly concerning. More than 3 out of 4 UK companies pay their male staff more than their female staff. In 9 out of 17 sectors in the economy, men earn 10% more on average than women. The worst sectors being Construction; Financial & Insurance; Education; Professional Services; Information and Communications.
What Does This Mean?
There are no legal sanctions (yet) for having a wide pay gap, but companies must now be clear and honest about their figures. And just getting these details out in the open has started to have significant consequences.
At Equal Talent, we have years of experience of working to improve female opportunity and representation in organisations. Our experience tells us that these changes in gender pay reporting will make a difference in a number of important ways:
1. Women will use their company pay gap reports to start conversations about getting parity of pay. This will also help bridge the confidence gap – where women have lower self- confidence than men – and this gap will also start to close. If organisations don’t respond, women will vote with their feet and leave.
2. Organisations will need to think in new, fresh ways about diversity and inclusion. It can’t just be an ‘add-on’ anymore. It needs to become something that people feel they are, rather than just a thing to do, or a box to tick.
3. The GPG reports will trigger more women working together to create an empowered, collective voice in order to tackle all inequalities at work, not just pay. This will help other minority groups in the workplace to find their own voices and push for equality. There are bound to be emotional reactions to these figures – both men and women will need to deal with their responses – and organisations must be ready to respond.
4. On a practical level, organisations will need to properly review their policies and procedures, from top to bottom. Everything from recruitment to employment contracts will need to be overhauled to remove barriers to progress for women. 5. Leaders will have to be accountable for the cultures they create and make sure they’re building a workplace that responds to everyone’s needs. Slowly, we’ll see that attitudes towards men looking to take career breaks – to be full-time parents, for example – will start to change, too.
What Must STEM Organisations Do?
To make genuine steps towards achieving gender equality and reaping the benefits from that change, everyone in the organisation has a role to play. Attitudes, behaviour and culture are all part of solution. This is about being smart and flexible – it requires real leadership, vision and performance from individuals and teams.
Our experience tells us that there are some specific actions organisations should take to better understand what’s going wrong and what they can do about it.
• Look at the reasons. What’s the root cause of the gender pay gap? Is it culture, structure, leadership or processes? Or a combination of these? Any attempt to fix the problem must start with an analysis of what’s happening within your organisation right now.
• Organisations need to develop their ‘why’ – a vision of the future that embraces change. This is the emotional hook that keeps change happening. Without it, old habits and bad behaviours will come back.
• Optimising talent is so important. Get a programme in place to share knowledge and expertise that supports female talent development.
• Identify how a collaborative and inclusive leadership style and culture differs from old ways of thinking. Once you identify these insights, share them.
• Recognise the role that men have to play in all of this. If you can rethink areas like parental leave and sabbaticals for men, then the whole culture starts to shift towards equality.
• Use mentoring and sponsoring to help pull women into the upper ranks of organisations. The talent is there – use it.
STEM IS ALREADY IN A DIFFICULT PLACE, WITH A SUBSTANTIAL SHORTFALL OF SKILLS AND TALENT. THERE AREN’T ENOUGH TALENTED WOMEN IN THE SECTOR, DESPITE RESEARCH SHOWING CLEARLY THAT DIVERSE COMPANIES DO BETTER THAN HOMOGENOUS ONES. ORGANISATIONS WHO DON’T FACE UP TO REALITY AND HAVE A CLEAR PLAN FOR CHANGE WILL FACE EVEN GREATER COMPETITIVE THREATS AS SUNLIGHT IS SHONE ON THE GENDER PAY GAP.
AMANDA DAVIE: 07879 885 418
EQUAL TALENT OFFERS COACHING SOLUTIONS TO SUPPORT STEM ORGANISATIONS IN CREATING A FAIRER, MORE BALANCED AND BETTER PERFORMING WORKFORCE.
References: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earning sandworkinghours/bulletins/annualsurveyofhoursandearnings/2017provisio naland2016revisedresults#gender-pay-differences