What is the Gender Pay Gap?

The Truth About Gender Pay Gap

Over the last Century, more women have had the opportunity to enter the workforce. Due to this, you would presume that the average salary received by Men and Women is equal – it is not! It has been found that across the workforce, women are being paid 14% less than men. This is known as the Gender Pay Gap and can be linked to the Confidence Gap.

How it is Calculated?

The Gender Pay gap is calculated by taking the hourly wage of all working men and women in an organisation, even those that are not in comparable roles, and calculating the difference in this wage.

Difference between Gender Pay Gap and Discrimination

There is a difference between unequal pay and the gender pay gap.  The Employment Equality Acts 1998-2015, make it illegal to discriminate on many grounds including gender & sexual orientation, religion, disability and so on. If a woman was being paid less than a male counterpart in the same or similar job, then she could possibly claim that she was being discriminated against due to her gender. The gender pay gap is not an inherent example of discrimination on the grounds of gender; instead, it shows the gender representation gap.

The Gender Representation Gap

Studies have shown that one of the features that leads to the Gender pay gap is the presence of a gender segregated workforce. This occurs when women work in more ‘traditionally’ female roles. These ‘traditionally’ female roles tend to be in poorly paid professions. Not only that, but as women are conditioned to apply for these traditional roles, you find that they are then underrepresented in other professions.

The gender representation gap occurs when there is a huge disparity in the roles that men and women are employed in and this causes a gap in wages as men tend to employed on the higher end of the scale, whereas women tend to be employed as part-time workers or suffer from salaries not being raised due to gaps of service should they have children.

Mandatory Pay Gap Reporting

As of January 2019, there are two bills working their way through the legislative process in Ireland, to introduce Mandatory Reporting of the Gender Pay gap in companies. When highlighted by gender pay gap reporting, Companies can then ask themselves important questions such as “Why are there not more women in higher up positions in the company?” and “Are we encouraging our female employees to reach their full potential?”.

IBEC released a very interesting guide to Mandatory Reporting in September 2018. In this, they outlined the effect that it will have once introduced and spoke of how the changes should occur.

Mandatory pay gap reporting will oblige businesses to publish a calculation to show the extent of the pay gap between what women earn as a group and men earn as a group. The gender pay gap in favour of men is a common occurrence which can be seen across statistics from different countries. In order to bridge the gap, employers should implement changes from the top of the organisation down. Gender parity is a strategic move that all businesses should be moving towards.

Problems tend to start in school when only students are offered gendered subjects. Girl’s schools tend to offer home economics and boy’s schools offer woodwork or metal work. Distinguishing a difference at this time, sets a barrier at a young age, enforcing a stereotype that a certain type of work is not suited to some genders.

In their report, IBEC stated that they do not believe Gender Pay Gap reporting by itself would solve the issue of gender balance in Ireland, however, by creating a system where companies must give transparent reports this could “enable organisational leaders to identify the true obstacles holding their organisations and sectors back”.

In the 2019 Pay and Employment Practices Survey carried out by CIPD, it was found that a quarter of the businesses that responded to the company reported that they have a gender pay gap. Not only that, but only 1 in 5 had calculated the pay gap despite looming legislation for mandatory reporting of the gap. The Director of CIPD Ireland, Mary Cunningham stated “Legislation is being introduced that is going to force companies to acknowledge that it is a problem…If they fail to address it now, then the law will address it for them through mandatory reporting”.

Case Study – Easy Jet

A UK company, Easy Jet, voluntarily released the Gender Pay Gap that was found in their company before the implementation of Mandatory Reporting.  This was, in essence, a good public relations move as though there was a large gap present in the company infrastructure; they released their narrative in advance with a set of guidelines addressing how they were going to eliminate it in the coming years. This includes the introduction of the Amy Johnson introducing a scheme to have 20% of new entrant pilots to be female by 2020. To see the report, click here.

Initiatives to Help

One organisation that is trying to raise awareness of the Gender Pay Gap and to try and combat it is ‘Dress for Success’. Its mission is to “promote the economic independence of women by providing career development tools and a support network.”

The legislation to make gender pay gap reporting mandatory has not been implemented yet. However, it will likely follow the English Model. Initially, gender pay gap reporting will only be mandatory for companies with 250 + employees, after a year, this will lower to those with 150+ employees and then it will apply to companies with 50+ employees.

If you are considering changing roles in the coming months, please get in contact with Quest Recruitment today. As specialists in the Financial Sector, we will strive to get you the best remuneration package our clients have on offer. You can upload your CV by clicking here and one of our consultants will be in touch with roles that may interest you.