A bigger gender pay gap could be good news, says WISE
As employers file their 2019 gender pay gap reports, WISE warns that some companies will report bigger gender pay gaps in comparison with their 2018 reports. These larger gaps could be an indication that companies are starting to take steps to improve the representation of women in their organisation.
Helen Wollaston, Chief Executive of WISE, the campaign to increase gender balance in science, technology, engineering and mathematics (STEM), explains: “We can expect to see the gender pay gap to widen before it shrinks for some male-dominated companies. This will happen if they have been successful in their efforts to attract more women into their organisations through their apprenticeships or graduate schemes. The challenge now is to provide a positive experience with development opportunities so that these women stay and move up through the ranks.”
Mandatory gender pay gap reporting for companies with over 250 employees was introduced in 2018 by the Government. The gender pay gap is a symptom of a gendered labour market. Typically, there are fewer women in the upper pay quartile which means the average pay for women is lower than for men. Organisations with a large technical workforce face a double whammy; as well as women being under-represented in higher paid management roles, they also have fewer women in the technical roles, which also pay more.
Helen offers the following advice to employers preparing their reports: “The pay gap itself is not the issue, what is important is understanding the reasons for it, so we recommend that you start from a position of really understanding your data. There is not one single reason, it varies by context, it could be that women are clustered in the lower paid roles, it could be about bonuses and the rewards package, it could be about hours of work because more women work part-time and the hourly rates for part-time work are much lower than the average rates for full-time work.”
WISE recommends including a narrative to explain the results in the context of their organisation and publishing an action plan saying what they are going to do about it and by when.
Helen adds: “Most importantly have an action plan and publish it; in 2018 only 1:5 companies created an action plan with any timelines, according to a review by the Equality and Human Rights Commission.
“It is important that you develop a culture that supports and increases inclusion so that women want to work for you, they want to stay working for you and they can see opportunities to progress through the management structure. As well as being the right thing to do, there is also a strong business case for having a diverse workforce; you will benefit from greater creativity, greater productivity and improved profits.”
Many companies are using WISE’s Ten Steps; a practical framework to increase retention and progression of women in a science, technology or engineering environment. In 2019, WISE will start a joint research project with the Royal Academy of Engineering which will examine the underlying reasons for the gender pay gap in engineering and make recommendations to help employers create their action plans.