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Mind the gap: What is the gender pay gap?

Workers’ rights have been evolving since, well, forever, and the introduction of gender pay gap requirements marks another significant step forward. From 04/04/2018 all companies with more than 250 employees are required to declare figures on their gender pay gap. So, what is it, and why is it so important?

The gender pay gap, simply put, is the difference between the average female- and average male- rate of pay. You can read about Lush’s gender pay gap here. The UK’s national gender pay gap is 18.4%, which means that the average male employee in the UK earns 18.4% more than the average female employee. This is a sure sign that something’s not right. It is a message that, should we all decide to listen, can help us work out where we’re going wrong.

Some understandably hear the phrase “gender pay gap” and misinterpret it to mean “equal pay”. It’s not quite as simple as that. Equal pay is your entitlement to the same wage as another person doing the same work as you or work that is deemed to be of the same value. There are some caveats to equal pay, such as age (the rate of minimum wage and living wage set by the government climbs incrementally from when you’re under 18 until you are over 25). However, broadly speaking, your right to equal pay, as well as equal terms and conditions of employment - regardless of gender or race - is enshrined in the Equality Act 2010.

Under equal pay laws, women should therefore earn the same as their male counterparts. Yet, it has been well-documented that women are absent from many boardrooms and senior positions. This is where the gender pay gap figures become significant; they are an official way of recognising and quantifying this gender disparity.

There are a number of deep-rooted reasons for the gender pay gap, and releasing these figures is a necessary first step to levelling the playing field. Once we know the scale of the problem, we can make meaningful changes to resolve it and hold those who don’t to account.

Executive director of the Equality and Human Rights Commission, Melanie Field, explains: “Pay gaps are a symbol of the work we still need to do to achieve equality for all. We need to radically change our workplace culture by advertising jobs as flexible from day one. We also need to stop viewing women as primary caregivers and address the biases that are rife in our workforce and society. The closer we get to closing the gender pay gap, the closer we get to a more equal Britain.”

In the UK the gender pay gap has stayed the same for the past three years, which is in part what spurred the introduction of the legislation brought in this week. It means companies with large gaps – of which there are many - will be visible and held responsible for closing them.

The Fawcett Society – a UK charity dedicated to advancing gender equality and women’s rights – was a key campaigner for the legislation. Insight and Policy manager, Andrew Bazeley unpicks its importance.

Andrew says: “The reporting and figures are a tool to start conversations in individual workplaces about why, within that organisation, women are paid on average less than men are. The gender pay gap allows you to see at an organisation level whether women are being paid equally to men. Prior to the legislation, we’ve only been able to say what the gender pay gap looks like within a particular industry or particular occupation.”

However, while the figures are a key first step, Andrew is keen to emphasise that they are only that. Figures. They won’t change things overnight, and they certainly won’t do it alone. For meaningful change to happen a whole host of other things need to be put in place, not least fines or penalties for failing to comply with the law.

He says: “The data is useful to start a conversation, but just reporting the data isn’t enough. It’s really important that employers look deeply into the data, speak to their employees, work out what is going on and publish an action plan so they can do what they need to do to close the gap.”

But what can be done about a problem so engrained into British, and often international, workplace culture? In fact, there are a number of solutions, some can be adopted at an individual organisation level, and some are societal and require collaboration, dialogue and even legislation.

Andrew explains: “The gender pay gap is a symptom of problems in an organisation in terms of gender inequality, it is not the cause of them. There’s a range of different solutions that can help to close the gap. It depends on what the individual company or organisation’s root causes of the gap are.”

While there are a whole host of causes, under representation in boardrooms and senior roles is emerging as one of the biggest. The largest gaps seem to be found when there are a number of women in lower paid roles in the lower quartile of the company, and little or no women in the higher positions, or the upper quartile. Andrew also draws attention to the “burden of care” often taken on disproportionately by women, as well as occupation segregation (when a job role or industry is dominated by one gender).

Each issue requires an individual solution, so it is for companies to get together and figure out solutions that can work for them. Andrew does, however, believe that there are a few measures that would improve gender pay disparity across the board: “One thing employers can do to improve their gender pay gap is to pay their lower paid staff better. Having a real living wage for example will very often reduce your gender pay gap while also very obviously being a very good thing to do.”

Research into the “burden of care” has demonstrated that the gender pay gap is often linked to workers with responsibilities of care, like mothers in the workplace. To combat the gender pay gap, employers may therefore want to introduce measures such as improved flexible working arrangements, so that employees - such as new mothers and fathers - can benefit from the same opportunities for progression.

In some sectors, employers may also find that there are larger, overarching reasons for their gender pay gaps, such as occupation segregation: wherein one gender is underrepresented in the field of work. These employers may struggle to find as many male candidates as female candidates to fill roles, or vice versa. In these cases, employers should focus their attention on broadening opportunities at an earlier stage. Take the science, tech, engineering and mathematics sectors for example. The gender balance is often weighted heavily towards the male side; in the arena of health and social care the opposite is often true. Programmes and schemes aimed at increasing engagement from an early age can help to dispel any myths and stereotypes that might stand in the way of young people when they make future career choices.

In future, help may come from the UK’s Government Equalities Office. It is working alongside the Behavioural Insights Team to deliver guidelines - grounded in research - that employers will be able to make use of.

Many gender stereotypes don’t start in the workplace and we all have a role to play in fighting gender inequality. But with 32.25 million people currently employed in the UK and the national gender pay gap standing at 18.4%, our workspaces are clearly an important place to start.

The Fawcett Society is the UK’s leading charity campaigning for gender equality and women’s  rights. Find out more here. You can read more about Lush’s own gender pay gap over here

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