This year marks the 50th anniversary of the Equal Pay Act. While the gender gap in the UK has been steadily closing, the ONS states the average gender pay gap between men and women in full-time work stands at 13.1%. Some of the reasons for the wage disparity include women working in lower-paid jobs as well as being underrepresented in senior roles.
In light of the 50th anniversary, Instant Offices looks into the steps taken to address the gender pay gap, and how effective they’ve been.
The real effect of the pay gap
Research from the Fawcett Society reveals only 2 in 5 female workers know they are being paid the same as their male counterpart, while 60% are either in the dark about how much their male colleagues earn, or know men make more. Further to this, 42% of women feel undervalued by employers who pay them less than men for the same role.
Closing the gap on gender pay differences
According to the data revealed by the ONS last year, Britain had the fifth largest gender pay gap in Europe behind Estonia, Czech Republic, Germany, and Austria, but was ahead of countries like Poland and Greece. In London, the gender pay gap barely changed in over two decades, narrowing a mere 0.5%, with full-time female employees earning on average 14.6% less per hour than their male counterparts, compared to 1997 when the gender gap sat at 15.1 %. However, due to the difference in male and female salaries, women generally start ‘working for free’ in the UK from around the second week in November.
As of government legislation that came into effect in 2017, UK companies and public sector organisations with 250 or more employees are required to report on their gender pay gap publicly. In April this year, thousands published their gender pay gap figures. However, according to the World Economic Forum, it could take over 200 years to close the gender pay gap on a global level completely.
That said, there are a few things companies could look into to help narrow the gender gap:
Incentivise paternity leave – Sweden has been a trailblazer since 1974 as there is now a new incentive for dads to spend a full three months at home. Fathers are granted 90 days leave, which is allocated on a use-it-or-lose-it basis, which means that if the father does not take time off work, then the couple as a whole will lose out on three months paid leave. Shared parental leave was introduced in the UK in 2015, although not all parents qualify.
Subsidise childcare – The cost of childcare can be a stressful factor for many families, with an average cost of part-time childcare being up to £6,000 a year. The UK government covers some of the costs of childcare once the child turns three, but with the nursery fees and travel costs, women on low wages often find going back to work to be a difficult and financially draining decision.
That said, some businesses have been stepping in to provide female staff with childcare services. According to research, companies providing childcare services saw reductions in employee turnover, increased productivity, and improved quality in job applicants.
Introduce remote working – In today’s digital world, remote working has become more acceptable and accessible to millennial workers, although parents can also enjoy the benefits of working from home. The Fawcett Society continues to call on employers to provide roles that are flexible, part-time or a job share.
According to the TUC, flexible working has real benefits for businesses, with employees proving to be more dedicated and productive.
There is a common misconception that mothers working from home are less ambitious than their colleagues are. On the contrary, according to a survey by Ernst and Young, 64% of working women who enjoyed flexible working hours claimed to have a clear career path compared to 10% of women who worked fixed hours. While flexible working conditions enable mothers to juggle work, childcare, and family commitments, it also allows more time for essential tasks.
Be transparent about pay – Being open and transparent about how much you pay your staff, whether listed in the initial job description or the interview, is a good starting point. Businesses should research market rates for a role and offer a fair salary for the job they are hiring for.
It is also a good idea to explain how your business determines salaries and pay increases upfront so that the candidate can make an informed decision about joining your company or not.
Ensure that promotions and rewards are fair – Disparity in pay can quickly occur when employees are offered promotions, pay raises or bonuses. Businesses must ensure that these are not in favour of male employees and that everyone has a fair chance of receiving a promotion, reward, or salary increase.
Whether it is an outright or subconscious bias towards male employees, this can quickly get out of hand, therefore putting in place clear and concise criteria for promotions, pay raises and bonuses will help keep things fair.