How can your company beat the gender pay gap?

The gender pay gap has been one of the most discussed business headlines of the past year. It’s the percentage difference in the average hourly pay between men and women and the release of this information from businesses worldwide has shown the disparity in gender pay. The pay gap is different to unequal pay, in the UK it’s illegal to pay women less than men for the same work and this has been a legal requirement since 1970. How a gender pay gap may occur is if the majority of men working at a company are in the top roles even though men and women are paid equally for similar roles as the top roles come with an elevated salary. It’s a complex issue but one of the causes for this is caring responsibilities. Women often take part-time roles to look after small children or elderly relatives, these roles are often lower paid and therefore reduce the possible earning potential including job progression for these women. The BBC also report that “Another important factor is a divided labour market. Women are still more likely to work in lower-paid and lower-skilled jobs. Women currently make up 62% of those earning less than the living wage…discrimination is another cause of the gender pay gap. The Equality and Human Rights Commission (ECHR) has previously found that one in nine new mothers were either dismissed, made redundant or treated so poorly they felt they had to leave their job. This can create a gap in experience, leading to lower wages when women return to work.”

Where are the biggest gaps?


The results show that while there are still gaps in most industries, some companies have managed to start bridging the gap while others haven’t. Finance came top of the list for industries with the least balance. The Guardian highlight that “Finance and insurance was one of the worst sectors for women to work in with an average gap of 22.9%, meaning a woman earned 77p for every £1 paid to a man. Average bonus pay in the financial sector also reflected a stark gap at 40%.” The high street banks performed particularly poorly with many ranging between 32% and 42% however the Women in Finance Charter was created to request an increase in the number of women in senior positions. Many airlines, education and health jobs came under fire and things haven’t been much better worldwide. In America, female physicians and surgeons face the largest pay difference with a 29% pay gap.

The World Economy Forum looked at global gender pay and note that the gap globally stands at a huge 68% which means that on average the gap is 32%. The report shows that no country has reached parity (yet) however “the top four are Nordic countries (Iceland, Norway, Sweden and Finland), one is from Latin American (Nicaragua, 5th), one is from Sub-Saharan Africa (Rwanda, 6th) and two are from the East Asia and the Pacific region (New Zealand, 7th, and Philippines, 8th). The top ten is completed by Ireland (9th) and Namibia (10th)”. There are some companies where women earn more than men, at Unilever Uk are an example where Women earn around 9% more than men due to 70% of their manufacturing roles are filed by male employees and more than half of their management roles are filled by women. Closing this gap is not an easy task but there are some methods employers can practice.

How can you start closing the gap?


Encouraging negotiations

A study found that “57% of men attempted to negotiate their pay compared to only 7% of women”. Looking at the issue from both sides can help to create a level playing field. Companies that allow salary negotiation show that they understand that flexibility can help with such pay issues. Employers that communicate what the possible salary range for the role is will encourage negotiations from women and help them know what is reasonable to expect and ask for.

Creating diversity in management

Currently, senior positions are dominated by male employees, look at your hiring process to determine how these roles can become more accessible by both female and minority groups. Create skills-based assessments to encourage this and show their talents rather than tell you.  Diversity in these positions will also create roles which other employees can aspire to and help with company retention. The Guardian explain that “Companies increasingly appear to recognise the business case for building a diverse workforce, with 60% saying it helps attract and retain staff, while half said it increased skills in the workforce”. Review the balance of men and women in your company, if the majority of higher roles are filled by men this shows a systematic issue that needs to be addressed. Pay employees what they’re due for their roles and set a strategy for how you can increase female balance in management positions.

Work schemes to balance caring

One of the issues many women experience is the limitation of roles and opportunity upon returning to work after caring for children or family members. Look at your part-time roles, is the pay fair and is there any reward for years of experience or an option for progression? If the answer is no, this is something that can be changed through return-to-work schemes to help this transition. Companies will also benefit from such changes as many talented women return to work in lower-skilled roles due to the part-time roles available.

Score jobs like Iceland

In Iceland, companies are required to pay equally or face a fine. “Employers must rank every job in a company and assign it a score based on things like physical strain and the level of responsibility. If two employees doing a job with the same score are not being paid the same, the company has to fix it.” Schemes like this use fresh ideas to create balance where needed.

When looking at the graduate gap, the results are similar in the UK at least. The figures “ suggest that the trajectory of a graduate’s earnings are set by not just their gender but also their social background and family circumstances, as well as their exam results before going onto higher education.” In order to reduce the number of graduates continuing this cycle, of these issues, gender is certainly one that can be tackled by hiring companies. When looking for new graduates, register with GradLink for free access to our extensive database of the top international students and graduates with diverse skills to add to your business.

By Jen Garmston Published: Sep 02,2019