New figures have shown action on achieving gender pay equity was slowing even before COVID-19 hit, prompting fears the pay gap might have even worsened during this year’s disruption.
Workplace Gender Equality Agency (WGEA) data, examining 2019-2020 figures, found a decrease of 6.1 percentage points in the number of employers taking action on pay equity, with just over half (54.4 per cent) of organisations that did a pay gap analysis taking steps to close it.
While there were improvements in some areas, with 50 per cent of employers now offering paid primary carer’s leave, a 3.2 percentage point increase in the number of employers supporting flexible work and almost half (44.7 per cent) of managerial appointments going to women – WGEA director Libby Lyons said the dearth of action on pay equity is particularly concerning.
“The overall lack of progress we witnessed this year could well mean that we see an increase in the gender pay gap next year,” says Lyons.
Source: Workplace Gender Equality Agency’s 2019-20 reporting data
Why are we going backwards on pay equity?
Simply put, Lyons says the gender pay gap is widening because organisations believe it’s justifiable.
“If you have a workplace that values both women and men, that addresses the issue of one gender dominating management positions, a recruitment policy that ensures conscious and unconscious discrimination and bias doesn’t impact your hiring and pay decisions, and all of your employees are able to work flexibility – then you will not have a gap,” says Lyons.
Fiona Krautil, who runs Diversity Knowhow, thinks the slippage could have to do with a loss of momentum on pay equity and a focus on other workplace issues.
“Achieving pay equity is a big project piece that requires an allocated budget. There has been no space for pay equity campaigns this year as HR has been focused on making sure people get paid,” she says.
Krautil says that the bushfires, COVID-19 and the resulting recession will likely have an impact on next year’s figures as well.
“CEOs are very focused on creating an inclusive culture at the moment, particularly in the LGBTQI space. Looking forward there will also be a big focus on establishing a workplace culture within a hybrid working environment,” she says.
The new WGEA data, however, could help to bring the issue back to the spotlight.
“The issue is not going away,” says Krautil. “There was a strong pay equity campaign in Australia a couple of years ago and it will come back.”
Addressing pay equity in your organisation
In order to keep the issue of pay equity on the radar of your executive team, Krautil suggests leveraging trend data, including the new WGEA findings, along with case studies of organisations with similar issues.
If your organisation has a large part-time workforce for example, Lyons suggested looking to Hesta Super Fund as a case in point. Hesta conducted a gender pay gap analysis and found their part-time workers, who are predominantly women, were not getting the same opportunities for training and development as their full-time staff, leaving them behind in career advancement. They now have a policy in place to ensure all employees have the same training and development opportunities.
When it comes to the business case for addressing pay equity, Lyons says it’s very clear.
“Our latest annual report with Bankwest Curtin Economics Centre, proved that there’s a convincing and strong relationship between increasing the number of women in leadership, and improved productivity, performance, and profitability,” says Lyons.
“In this time of recovery when organisations are looking to rebuild and develop their businesses, they will ensure their organisations are more competitive, happier places to work and more profitable if they address gender equality.”
If you’re unsure where to get started, there are several WGEA resources to help kickstart the process:
- a pay equity calculator for conducting an analysis
- a paper on addressing pay equity with some guidelines for doing a gender pay gap analysis and designing an equitable remuneration policy
- a summary of the business case for gender equality
- a guide for setting targets
- a gender equality strategy page.
Action steps to take during hard times
If pay equity can’t be prioritised on an organisational level this year, there are several ways HR can work to bring about change.
When it comes to recruitment and promotions, Krautil says it’s imperative that women are brought on at the right level, which helps to fix the issue individually.
“Women will typically be brought in at lower levels on the pay scale and if you come in on the wrong level, you are always behind. HR should be the independent reviewer and benchmark the rate of pay along with coaching hiring managers about bringing people in on the rate they deserve,” she says.
Krautil suggests keeping an eye on your graduate employees to ensure pay equity hasn’t been lost in this group. The 2020 Graduate Outcomes Survey revealed that there are still pay gaps in graduate groups across various sectors, such as architecture, law, and science and mathematics.
“By looking at your critical groups such as graduates you can make a difference without having to tackle the problem across the organisation.”
To ensure women aren’t discriminated against in hiring and pay decisions, Lyons says HR should have sound policies and procedures in place to tackle bias. This includes making sure all candidates are asked the same set of interview questions, that there is gender balance on the interview panel and on the short list, and that there is an independent person from outside the organisation sitting on the recruitment panel.
Another key area to focus on is flexible work policies and strategies, which HR has an opportunity to revisit due to our new hybrid way of working.
“Make sure men are engaged in formal flexible work and put some targets in place,” says Lyons.
As we move into a post-pandemic world, Lyons says HR needs to monitor and measure men and women’s return to the office. Recent research suggests men are more keen to return to the office than women, which could lead to an exclusion of women from formal decision-making and development opportunities.
HR should also keep track of employees on compressed work weeks to ensure they are not short-changed by being paid as part-time employees when they have a full-time workload.
Lastly, keeping up to speed with gender equality trends will help HR be innovative in the pay equity space. Krautil recommends ensuring someone in the HR team is regularly attending conferences so you’re up-to-date on the latest information around pay equity challenges and solutions.
‘It’s also a good idea to set a KPI for someone in your team to improve their knowledge and the organisation’s standing on pay equity,” says Krautil.
While Lyons concedes that the cultural change required to close the pay gap will take a long time to achieve, this is exactly why we need to keep talking about it.
“We have to keep our foot on the pedal and tell our organisations that gender equality is not just the right thing to do, but the smart thing to do, and you will have a better business if you address it.”
Tackling gender inequality in the workplace requires developing psychologically safe spaces for women. Get your tickets for AHRI’s virtual International Women’s Day 2021 event to learn how we can build a brighter future for all.