Sound the fed-up klaxon: the gender pay gap – which was static for years – is now growing at thousands of companies. Why? And what on earth can we do?
The frustration of it. The sheer frustration. We ask for legislation. We talk to our employers. We do everything we can and, despite it all, the gender pay gap is getting worse at thousands of firms.
Last April was the first time British companies with more than 250 employees had to submit data to the government about what they paid male and female employees. Pay differences would be out in the open. We’d have to talk about it. The new law, an amendment of the Equality Act, felt like a positive step. One year on, and hope is dissipating. Frustration reigns.
The final deadline for companies to report their gender pay gap in 2019 was 4 April – and the results aren’t looking good. A BBC analysis of the data found that fewer than half of the UK’s biggest employers had succeeded in narrowing their gender pay gap. At a shocking 45% of firms – that’s more than 4,500 companies – the pay discrepancy had actually increased in men’s favour. The finance and insurance sector has been revealed to be among the worst industries for women to work in, with an average pay gap of 22.9%. But overall, almost eight in ten British companies (78%) – across every single industry – still pay men on average more than women.
Almost 10,500 companies had filed their pay comparison data by midnight on 4 April, but it’s not yet clear which firms failed to respond (as the government has never provided a definitive list of businesses obliged to participate). There was also speculation that companies worried about their figures would delay reporting until the final deadline of 4 April to try to avoid any unwanted attention.
It’s also hard to analyse the data we have, since the way figures are reported gives very little detail or context. We need the government to change this. We at least need data broken down by ethnicity (for example, as women of colour are often paid less than white women).
Ahead of the pay gap reporting deadline, Stylist spoke to the BBC, the Fawcett Society, the Government Equalities Office and the Women’s Equality Party to get their takes on why the gender pay gap is getting worse at so many companies.
Here’s what we have discovered so far – it’s not pretty.
Businesses are not being held to account
While businesses are required to give basic data about the difference in men and women’s pay, they aren’t currently legally required to publish any action plan. The government set a goal of five years for businesses to close their gender pay gaps and we are only reaching the end of the first year.
It’s feasible that things could be taking a dip before they get better, but without more information disclosed, it is impossible to know whether businesses are on track in the long run and impossible to hold them to account in any meaningful way.
Many companies may be complying by doing the minimum required by law in disclosing figures, but it’s not possible to tell whether they really care about making a change when they have no demonstrable targets or goals to meet. Ideally, businesses should provide a five-year plan alongside their data and report on their progress against that, showing that they understand why they have a pay gap and what needs to be done to close it in the long term.
So long as they are only giving up very basic data, if they’re in a sector such as finance in which every company has a terrible pay gap, many appear to be happy to hide in the crowd without being forced to show they are taking any real action.
Things will get worse before they get better
One optimistic theory as to why the gap might have opened up this year is because companies genuinely are trying to make a change. If a business is making an effort to hire more women as part of a long-term plan for gender equality, those women may initially be coming in at a low level of pay in pipeline initiatives where they are trained to work their way up through the ranks to senior positions. This would increase the pay gap at that company as a wider pay gap typically means that a business has more women in junior roles and more men in senior roles.
The truth is it’s hard to know, as they aren’t bound to publish their strategies. And if it were true, there’s a question of why they wouldn’t be hiring more women at a senior level – to which some companies answer that there simply aren’t many women who have worked at the top of an equivalent company yet in fields traditionally dominated by men, such as engineering or construction.
Women leaving senior roles can skew numbers
In the most senior, highly paid roles at any company, very small shifts can heavily affect numbers. The median figure is the one that most businesses lead with and you can skew that easily if a company has a few really well-paid people, which some analysts suggest may be a cause of the new figures.
It’s possible that if one woman leaves a high-status role, for example, that can be enough to completely change the data and could account for additional companies performing more poorly this year. Having said that, it should be up to the business to make more effort to maintain an equal proportion of women in top seats.
There is a failure to provide flexible working
Some companies claim that a pay gap exists in their organisation because women themselves ‘choose’ part-time contracts, freelance work or lower responsibility roles – something that’s very rarely a choice but often a necessity when it comes to raising children or caring for family.
This work is usually poorly paid, largely done by women and very rarely, if ever, offered in senior roles. It has been another year where no change has been made in terms of roles that offer both flexibility and security.
We’re still burdened with the baby tax
Iceland offers both parents three months of paid leave and is the country with the smallest gender pay gap in the world. Here in the UK, shared parental leave – where parents can split 50 weeks of leave and 37 weeks of pay – is a step forward, but figures from last year show that the take-up may be as low as 2%.
A huge gulf opens up in pay difference when women have children: by the time a first child is grown up, UK mothers earn about 30% less on average than similarly educated fathers.
This comes down to gender bias – the Equality and Human Rights Commission found that a third of employers assume that mothers are less interested in career progression; something that’s simply not true. Mothers are regularly unfairly dismissed, overlooked for senior positions around the time they start to have children and struggle to return to work in the same role or return to find they’ve received a pay cut.
Until we change the difference in expectation between a mother and father’s career patterns after having a baby, we will never achieve parity.
So how can we help tackle the inequality?
How to help close the gender pay gap
Don’t be squeamish about money
Figures from Mintel showed last year that women are almost half (22%) as confident as men (42%) about asking their bosses for a higher salary. The same research also found that just 41% of women feel confident about challenging a senior employee, compared with 62% of men. So do women just need to ask for more money?
In terms of personal empowerment it’s one thing we can do, though it’s also not quite that simple – and it can be a damaging narrative. A McKinsey report in 2016 found that even when women asked for promotions as frequently as men, they were less likely to be given them. Women should feel confident in asking for more money, but the onus shouldn’t solely be on them – it’s also down to employers.
It is a good way to take charge, however, now that we have some figures to work with. A useful starting point is to talk to other men and women in your field and in similar roles about what they earn to help increase transparency around wages.
Challenge your company
There are several key things which can be introduced to organisations that are crucial to closing the gender pay gap, according to the Fawcett Society. The first is to challenge them to provide increased flexible working in order to support women and allow them to get into more senior positions. They believe flexible working hours should be offered as standard for all roles unless there is a good reason not to offer that, alongside better paid and longer parental leave for fathers and better protection against gender discrimination in the workplace – and specifically against pregnant women.
Another key practice to help bring about change is to introduce gender initiatives such as unconscious bias training, which we know heavily impacts women’s opportunities to reach the top of companies.
Campaign for change
As much as women can empower themselves with knowledge and demand equality at work, we still need big changes to be made by the government. The gender pay gap reporting is a step in the right direction, but it is flawed and could be improved with amendments; something the Fawcett Society and the Women’s Equality Party are continually fighting for and which we can all join in to lobby our local MPs about.
The Fawcett Society argues that the minimum size of companies legally obliged to take part in pay gap reporting should be reduced from 250 workers to 50; the Women’s Equality Party think it should be 20, which is the number used in Scotland. There is also arguably too little transparency and not enough detail in the reporting overall.
Most crucially, we need businesses to produce action plans that workers can track and use to hold them accountable in order to make progress. Employers have been forced for the first time in the past year to confront unequal opportunities and pay differences, but so far they haven’t needed to give any explanation for the unfairness in their figures. With no targets, it’s no wonder we aren’t on track to close the gap.
A version of this article was published in issue 459 of Stylist on 2 April 2019. It has been updated to include gender pay gap data revealed following the 4 April reporting deadline.
Additional words: Anna Fielding, Moya Crockett. Images: Getty Images