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Women's pay catching up - but not quickly enough

Written by Ryan McChrystal on Wednesday, 07 January 2015. Posted in Diversity, People

Much more needs to be done to tackle the gender pay gap. Total transparency in salaries may give things a nudge in the right direction

Women's pay catching up - but not quickly enough

It’s been 46 years since women workers at Ford’s factory in Dagenham downed tools and marched to Westminster to demand equal pay rights. Their jobs – sewing seats and making upholstery for cars – were deemed ‘unskilled’ but, quite rightly, the women wouldn’t take this lying down: they walked out, eventually halting production. This, along with similar actions at the time by other female workers, culminated in the introduction of the Equal Pay act of 1970, which ruled that no woman should be paid less than a man for doing the same job.

Back when those Ford sewing machinists went on strike in 1968, women were paid an average of £0.64 for every £1 a man made. Now in modern-day 2014, you might assume we’re all square – but it’s not quite like that. More than 40 years after the introduction of equal pay legislation, women still only make an average of £0.81 for every quid that men make. Despite what some would have you believe, this is quite a significant gap and, while it is closing, it isn’t closing quickly enough. Without drastic measures, it could be a long time before we see anything close to equilibrium.

There are many reasons that culminate to create that pay gap. First and foremost, the route to progression is essentially blocked. Dr Alison Parken, research partner of the Women Adding Value to the Economy (WAVE) Programme, says: “Well-paid work is full-time work, and in Wales, for example, men hold two-thirds of those positions, whereas women occupy 80% of all part-time jobs, which are low- skilled, low-paid and have very little routes out.”

“Various forms of gender segregation combine meaning we will have gender pay gaps forever unless we do something about the employment structure,” she adds.

WAVE has developed a tool called the Equal Pay Barometer, which allows people in Wales to search for the average salary for men and women across 300 different jobs and highlights any gender pay gaps that may exist. The equalities act of 2010, introduced in the dying days of the previous Labour government, included section 78, which required companies to be transparent about the gap between male and female pay. But when the current government came to power section 78 was never enacted. Instead it was decided not to force companies to act but to wait for them to do so voluntarily, and very few have obliged.

For Peter Burgess, MD at Retail Human Resources, the UK’s largest recruitment company specialising in the retail sector, this is a major barrier to pay equality. “The problem is that this will continue as long as salaries are kept secret and ancient discrepancies in what people are paid are carried forward by employers, even unwittingly. The only way to sort this issue out is for salary policies to be open,” he says. “Sadly in the private sector almost all companies have a culture of secrecy around who is paid what and until that changes this problem will not go away.”

Internally, Retail Human Resources has had a transparent policy on salaries for two decades. “It builds trust and respect and ensures that people are not, unwittingly, treated unfairly,” he says, which is partly the reason why Retail Human Resources was recently listed in The Sunday Times 100 Best Mid- Sized Companies to Work For and has also received 3-star accreditation for ‘extraordinary’ workplace engagement.

Professor Jill Rubery of the Manchester Business School, whose research work and publications have covered, amongst other topics, labour market regulation policies, women’s employment and women’s pay, agrees action must be taken. But, for her, the onus is solely on employers.

“In improving women’s pay, we’re really swimming against the tide because, with the nature of the labour market in the UK, there is even wage disparity among people that have had higher education,” she says.

The highest paid jobs tend to be those that are still “colonised” by men such as the financial sector, says Rubery. In her view, companies have a duty to comply.

 

However, even getting women into these positions won’t be enough because the highest levels of inequality actually exist not within ‘traditional’ female roles but at the director level, where men take home on average 35% (£21,000) more than females. The overall average for full-time work is around 10%.

Lynne Stephen, director at recruitment expert, Maxwell Bruce, has forged a prosperous career in the recruitment industry over the last nine years. The gender pay gap is a topic close to her heart. For her, inequality between men and women’s pay is made even more unpalatable given the introduction of child care, shared parental leave and flexible working, women are more able to contribute to the same level as their male counterparts. Stephen doesn’t necessarily think that companies are deliberately under- paying women; more that men are more likely to ask for more money and more benefits. Similarly, she has noticed a tendency for women to only apply for a role if they tick every box on the job specification, while men appear bolder and will apply if they meet only two thirds of the criteria. “It comes down to confidence,” says Stephen.

“When in a role as a woman, you can find yourself in two very different situations: you want more money because you feel you deserve it or you want it because your colleague doing the same job earns more,” she says. If it’s because there is a pay discrepancy, something that she finds completely unacceptable, it must be addressed directly, which can be difficult given the confidential nature of salaries.

Her advice in this situation that an employee should get clued up on their rights and take the first step and arrange an informal meeting with their line manager. “You may be surprised at the initial reaction and, if it’s justified, you may walk away with higher pay and an apology.” Stephen advocates thorough preparation as crucial before taking part in any discussions on remuneration – informal or otherwise.

Similarly, Ishreen Bradley, an executive coach who specialises in coaching senior women in high-innovation sectors like engineering and design, finance, IT and logistics, says women are often nervous about speaking out. “Women don’t want to be seen to be too demanding and some may even be fearful that doing so could threaten their career prospects. Yet failing to speak up could be costing them several hundred thousand pounds over their careers,” she says.

Discussing a salary rise gives someone the opportunity to highlight how they are contributing to the business and the skills they have, something that in large organisations many managers will not necessarily notice unless they are told.

“Women need to highlight their strengths in the workplace and do their own PR, something that can come more easily to men than women. But most importantly, they need to take responsibility for what they are paid and think about what action can be taken to close the gap and to be paid the same as men for the same job,” says Bradley.

When it comes to addressing the pay gap, Stephen believes that SMEs have a role to play also. They can take action on a number of fronts, and that it doesn’t all come down to throwing cash at the issue. “Ultimately, SMEs all want costs to be as low as possible; however, it must never be at the expense of someone’s salary.” Employees must know their value and paying one more than another for doing the same work is never acceptable, she believes. Again the solution comes down to transparency. “Being more open and clear goes a long way towards reassuring employees that they’re being rewarded appropriately.”

The introduction of visible pay bands, as well as keeping a tight schedule of pay reviews – and sticking to it – would be a great leap forward, Stephen suggests.

Additionally, men could act as the greatest ally of working women. “The majority of board and senior management positions are held by men so, in short, we need the help of men to tackle the overarching issue,” urges Stephen. “They need to help drive change in the workplace. We must also educate youngsters to ensure they are aware that no job is out of their league and that equality is the right thing, as well as everyone’s right.”

Like those Ford workers in Dagenham all those years ago, women who feel they aren’t been treated fairly need to step up. However, businesses should know they have a role to play as well in order to make sure that women and men are paid fairly and equally for the jobs they do. 

About the Author

Ryan McChrystal

Ryan McChrystal

In a previous life McChrystal wrote about asset management in the Middle East. A history and politics graduate from the north of Ireland, he now focuses his efforts a little closer to home. 

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