Four essential steps to address pay gaps and equality : Innecto Reward Consulting

According to a World Economic Forum Gender Gap Report published in July 2022 the UK’s gender pay gap ranking is 22 out of 146 countries, with Iceland, Finland and Norway topping the table with the smallest gaps. At the current rate of change, the report suggests the UK’s gender pay gap will take 132 years to close entirely. A sobering thought.

The causes of gender pay gaps are deep-rooted and created over decades, from women entering the workforce later than men, role stereotyping and the simple fact of the parental penalty.

Since the Equality Act 2010, employers are required to pay men and women doing a similar job the same amount of money but the overall difference in average earnings between all men and all women comes down to the distribution of roles from high to low in organisations, mainly due to work-family balance, and structural inequality in the workforce.

There are big things happening at a macro level outside of the UK. For example, we saw a strike only this week highlighting the ongoing inequity in a country that is seen as one of the most equality-focused in the world. Also, initiatives like Gender Parity Accelerators are being adopted at the national level to expedite a narrowing of the gap with giant leaps forward. Costa Rica, for example, introducing a national care policy around pre-school children; or Iceland’s new policies on shared parental leave and accessible childcare.

But how can we take that same kind of thinking forward on a more microscopic level and create our own Gender Parity Accelerators? Bravery and creative thinking is usually at the forefront of these advances, but what actual measures can we tangibly take today?

Opening up – Only when people accept on a societal or company level that a pay gap exists can positive change happen. By investigating and explaining why a pay gap exists, people can create an action plan to start narrowing it. There is a genuine power – both internally and externally – that comes from opening up a narrative in this way. Only by doing this can you come up with an action plan that needs buy-in and commitment from leadership and across the board. Typically, this will lead to initiatives and policy specifically designed to balance things out by recruiting, promoting and retaining top female talent.

Recruitment and DEI – Unconscious bias happens everywhere but by adopting more enlightened recruitment practices we are less likely to affect an application pool through gender-bias. HR teams are becoming more aware of where to advertise, how to use tone and language to appeal to both men and women, and ultimately how to attract people from different backgrounds. Related to this, DEI strategies are far more commonplace as companies also recognise the benefits of a diverse workforce. These can be financial but touch many other areas such as creativity, problem-solving, reputational, increased productivity, innovation, employee retention and enhanced client engagement.

Default setting: Flexible – Companies will only drive towards genuine equality if they enable women and men the freedom and flex to fulfill the same duties both at work and at home. Most obviously, levelling things up around maternal and paternal leave to enable genuine sharing of childcare duties is important. We are seeing policy changes that allow men and women to equally partake in childcare should they wish or allow the man to take on this role for a prolonged period, or even full-time. A flexible approach to work itself is another hugely important factor: should moving to part-time necessarily signal a demotion? Not in a company taking this seriously.

Policies & Practices Review: a constant process – To drive parity and fairness you also need to constantly review your HR policies and procedures to make sure that systems are in place to question whether pay for men and women is fair. Are starting salaries for a particular role the same for men and women? How are our promotions and pay increases happening, and when in the pay cycle? Do we have a proportionate percentage of men and women being promoted? Do men and women progress through our organisation at a similar rate? Is sound logic being applied to pay rises where negotiation is happening, or where experience and flight risks are being considered?

All these questions and considerations should be part of a constant process of checks and balances, and a desire to act swiftly. If you put off analysing a gender pay report for half a year, you have six months less to act, ‘open up’ and influence change.