Tackling gender pay gaps in organisations

On International Women’s Day this year, 8 March 2022, the Government Equalities Office (GEO) announced a new pilot scheme to improve pay transparency, in a bid to tackle pay inequality. It is hoped this will tie into the government’s wider ‘levelling up’ initiatives and improve employment opportunities for women.

Participating employers will list salary details on job adverts and stop asking about salary history in the recruitment process. A Glassdoor survey found 68% of jobseekers thought salary was the most important factor of a job advert. Separate research saw 4/5 jobseekers are less likely to apply for a role if the salary isn’t listed in the job advert. As such, employers who amend their recruitment strategy in light of this, will optimise its success and be better placed to attract candidates.

Similarly, 58% of women felt they had received a lower salary than they would have if they hadn’t been asked about their salary history as part of the recruitment process. If wages are influenced by what an individual earned in their previous employment, unfair gaps may be created. Instead, all employees should be given equal pay for equal work, regardless of what they earned in the past. Removing the requirement to provide a salary history will also give women a much firmer footing in pay negotiations. However, removing negotiating completely, and simply setting a fixed rate of pay for all, can improve transparency, trust and employee satisfaction within organisations. Employers who pay their staff equally further minimise the risk of pay-related grievances and discrimination claims. Doing so also contributes towards an improved company culture, supporting diversity and inclusion, which helps to boost retention and productivity.

At the same time, it is recognised by the government that many employers lack a clear pay structure and may struggle to provide this information on job adverts. Part of the pilot, therefore, will be to develop a methodology for employers to provide pay information at the recruitment stage, rather than relying on pay history.

For organisations with more than 250 employees, publishing a gender pay gap report is a legal requirement. The report should show the mean and median gender pay gap figure for pay and bonuses; as well as, the number of men and women who receive a bonus, and number of men and women at each quartile of the pay scale. A written statement should accompany the figures to explain why there are any gaps and what the organisation plans to do to reduce or eliminate this. It’s beneficial for employers to put together an action plan, to clearly explain how they plan to tackle their gender pay gap and wider issue of inequality in the workplace. Doing so can help employers develop a reputation for being fair and progressive and shows that they are committed to creating a diverse and inclusive environment.

The report should be published on the company website in a way that is accessible to the public, as well as on the government website. The deadline for publishing gender pay reports is fast approaching, with public sector organisations having to do so by 30th March and private, voluntary and all other organisations doing so by 4th April.

 

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