Gender pay - an opportunity for change

By Alastair Woods

The new gender pay reporting comes into force in the UK this month, firing the starting gun for companies who have a year to gather, review and publish their gender pay gap and other statistics.  This reporting brings both challenges and opportunities.  It will inevitably mean that companies can be ranked against one another. There is a risk that it may spark an increase in equal pay claims if organisations don’t communicate their gap, and what it means to their employees, in the right way.  But I think for many, the biggest consideration is the impact on an organisation’s reputation. The gender pay gap and accompanying narrative will, very simply, speak volumes about the organisation and how it thinks about inclusivity and fairness.

But I think there are positives and opportunities here. The first is that companies can use this to set out what they are doing to improve gender equality and wider diversity and inclusion in the workplace. And the second is that this new disclosure will finally act as a catalyst for accelerating change in gender equality in the UK.  

Using gender pay to convey your Employee Value Proposition

Existing and future employees will want to know how the company thinks and acts about diversity and fairness. There may be some education to do - explaining the difference between equal pay and a gender pay gap, the impact of societal and economic issues and organisational challenges. But a distinctive story, acknowledging the issue, and explaining how your organisation is trying to create an inclusive workforce environment will be very powerful. It is brave. Why not admit “We have a problem and here is how we are going to fix it”?

Acting on it to make lasting change

The second opportunity is for organisations to start to implement and accelerate changes that address representation as the gender imbalance at senior levels is one of the primary causes of the gender pay gap.  Let’s face it, this is a super tanker built up over many decades of societal and economic norms which have resulted in a lack of female talent in higher paid jobs and senior roles. We know that some industries, such as financial services and technology, have higher pay gaps. In technology they're addressing this by starting to work more closely with schools and universities to increase supply of STEM talent for example - and finding more creative ways such as apprentices and community work to find new sources. And the other commonly cited cause - the drop off in female employees in managerial roles after age 35 - can also be addressed by changing recruitment practices, starting returnship programmes, implementing flexible working and shared parental leave. Having been an early adopter of shared parental leave - I can wholeheartedly endorse sharing the time among two parents. It has a beneficial impact on parenting and means that it becomes a shared endeavour.

Projections from our Women in Work Index have highlighted that it will take until 2041 to eradicate the gender pay gap.  It will take time, but by communicating and acting on the challenges, it could be much sooner. I am optimistic many employers will rise to the challenge.

If you’d like to find out more about gender pay reporting and how we can help, please click here

Alternatively, feel free to get in touch with your usual PwC contact or myself ([email protected])