Both the UK and US recently instituted new initiatives to close the gender pay gap. Is it time Australia stepped up its game?
The UK will be naming and shaming the 1,500 employers who failed to report their gender pay gap by the 4 April deadline. Not only will these organisations face public admonishment, but they are also subject to fines and legal action for not handing over their data.
The legislation, introduced last year, requires all British companies – whether public private or charitable – with over 250 employees, to report the disparity in the hourly pay gap between men and women. They are also required to provide information pertaining to bonuses and the number of men and women per business unit.
Of the employers who did submit their data, 80 per cent pay men more than women. No sector reported paying women a higher average salary than men.
Across the pond, a US appeals court has made it illegal for women to be paid less than men based on their previous salary. Given that women are likely to be paid less to begin with, this “excuse” for paying women less initiates a gender pay gap into motion.
So what is Australia doing to close the gap?
Secondly, Australia already has a similar reporting system in place to that of the UK. Australian companies are required to disclose their gender pay gaps to the Workplace Gender Equality Agency annually.
But if we don’t want to be overtaken, we could be doing more.
The Australian arms of two private professional services companies Ernst and Young and PwC recently made the move to be transparent about their pay gaps. PwC’s current gap is 12.3 per cent, which includes partners. On a like for like basis per role, however, the gap is 0.3 per cent.
Interestingly, Ernst and Young’s firm wide average differs significantly from its partner level gap – 10 per cent and 14.9 per cent respectively, which CEO Tony Johnston says is a reflection that there are more men in senior partner positions than women. This is perhaps, more telling – women are clearly not granted the same opportunities as men.
In an Economist article it was suggested that companies look “behind the numbers” to identify where the disparity in their organisation lies.
“What companies really need to find out is whether they are hiring equitably, paying equitably and are offering equitable opportunities to advance,” says Brian Levine, partner and innovation leader at US based human resources consultancy, Mercer.
One of the areas Australian organisations need to focus on is the “motherhood penalty”. Data from he Diversity Council of Australia says the influence of time off from working on women’s careers has more than doubled in a 10 year period. What’s more, one in two mothers say they were discriminated against at some point, either while pregnant, on maternity leave or once they returned to their jobs.
If we want to close the gender pay gap we need to be looking more closely at the culturally ingrained drivers.
Hear firsthand how organisations are changing mindsets and pressing for gender equity in the workplace at the AHRI Inclusion and Diversity Conference in Sydney on 3 May.