Gender Pay Gap reporting – what difference might it make?

So how to reduce the gender pay gap through H.R. practices. This is a vexed question that is currently occupying the minds of H.R. professionals in organizations but also policy makers at government level because of the response to the government’s gender pay gap reporting regulations. In order to reduce the gender pay gap you’ve got to get to the heart of the problem you’ve got to understand the causes within each workplace. So any sort of analysis that helps you to understand the patterns that give rise to the gender pay gap is very helpful.

So I’m going to tackle this in in two different ways, first of all we’re going to look at how general measures of equality and equal opportunity can help to reduce the gender pay gap. And second the ways that having a good look at the pay schemes that are operating in the workplace can ensure general pay equality also. So let’s have a look at the first question first and that would be the major cause of the gender pay gap tackling that which is of course as you know occupational segregation. Women tend to be found in the lower strata of the organization and they’re also found bunched into certain low paid occupational groups.

To tackle the first you would need to ensure that you promoted women equally into senior leadership positions. So here the H.R. practices consider a general measures of equality within promotion, access to promotion opportunities, the recruitment of women directly into senior leadership positions. And the government gender pay gap reporting regulations are very helpful in this respect because they require organizations to analyze their workforce in quartiles, so you can see the distribution of men to women within the various quartiles of the organization.

It would be more helpful if they also required organizations to look at the pay gaps within those quartiles because it is highly likely to be the case that even within the various quartiles, especially at the senior levels, that men will still get paid more than women. So an extension to the gender pay gap reporting regulations would be helpful here. And the gender pay gap reporting regulations is also silent on where women are distributed in terms of occupational groups. So men often take higher paid occupations and the H.R. department can respond to this by offering say secondment opportunities to women, different training opportunities in order to encourage them into the higher paid jobs and professions.

And so that’s two ways that H.R. departments and policies and practices can overcome the gender pay gap. The other thing to consider here is retaining women, so women that I’ve left the workforce will never become senior managers and will not earn to their fullest extent. So if you can retain women, encourage them to stay through every policy and practice that the H.R. department could leverage in this way would be very helpful. They will continue to stay with the organization they will continue to earn more and this will help to reduce your gender pay gap.

And if the reporting regulations were extended to encourage a reflection on tenure or length of service then this also might help to highlight where part of your gender pay gap problem lies. It’s also the case that women perhaps are dominant amongst the part time workforce and part time workers may be seen as less committed and therefore have fewer career options. And this should be discouraged through schemes such as job sharing or ensuring that every job is advertised part time if it’s not there has to be a valid reason for that. So ensuring that your part time workforce is equally has as equal access to career options is very helpful.

The second type of area of practice then is to interrogate your pay scheme to ensure that it is applied equally to men and women. This is the government pay gap reporting regulations are silent on this issue but it’s certainly worthwhile considering because herein lies some of the problems of pay inequality. This would be looking at and interrogating the sorts of areas such as how much of your pay scheme is open to negotiation, how much of your pay rate is open to negotiation. Are people able when they’re recruited or promoted to negotiate for them, a pay level. A pay rise. And is it the case that perhaps men are better at this than women. Or are your pay scales too broad.

Do you have too many pay points in your pay scale because it’s often the case that on a long pay scale women tend to be found at the lower levels. And it takes them a long time to catch up with men who are at the higher levels. The role of bonus is also an important one to consider. What is the criteria of bonus that you utilize. Is there any potential bias within those criteria. And finally of course the role of job evaluation is important. Job evaluation is a key part of a defence against pay inequality.

However it has been shown that certain job evaluation schemes allocate higher level points to male types of skills than generally devalue the role of of perhaps what one might consider the sorts of skills that that women are best at or are the sorts of skills where women excel. So the role of job evaluation is also important. So two different types of approach. One indirect and via general measures of equality and the second really looking at the direct application of your pay schemes.