5 Tips for managers to redress the gender pay gap

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Women doing the same job as men are supposed to be paid the same by law. Yet the gender pay gap currently stands at 17.9%, meaning Australian women, including you, have to work an extra 65 days this year to earn the same as men. That’s a whopping $284.20 a week less. Pay inequity happens for a few reasons – some are structural, some are personal – but the combination results in women earning around $700,00 less than men over their working life. The gap is the cumulative result of discrimination, unpaid carer responsibilities, and the undervaluation of work undertaken by women, particularly in the social and community services industries. Additional challenges such as divorce, coupled with government schemes such as superannuation which is linked only to paid work, mean women are more likely to live in poverty in old age than men.

So, as a manager, what can you do about it? After holding leadership positions in corporate strategy and finance for the past 25 years, here are my tips: 

1. Check your promotions & terminations – are they transparent?

Our own unconscious biases tend to mean that we promote on the basis of affinity bias.” The same goes for terminations – in the last round of redundancies, how many of your female employees on parental leave or working part time were prioritized for a redundancy? Its part of a culture that continues talk about diversity but be unable to follow through with inclusive cultures, having a direct impact on the gender pay gap. These decisions are often justified on the basis of “merit”. But with women comprising more than 60% of all university graduates, can we really say that there is no promotion bias towards men, who simply by virtue of the fact they are male, are 9 times more likely than a female competitor to make it to a leadership role? You can ensure that your promotions and terminations are more equitable by simply asking a female colleague to work with you: to interview with you, and to review termination processes with you. Make your processes transparent and objective.

2. Ask yourself: Do you really value employees that work flexibly or have taken parental leave?

The business case for flexibility is clear – more engaged employees, better business outcomes. But just because you have a great policy doesn’t mean its a reality. Do you, for example, subconsciously discriminate against those working flexibly by paying them less? Many women are so grateful for the opportunity to work flexibly to accommodate their carer responsibilities, they do not negotiate on salary. They are also not aware that there is a 7% penalty for taking parental leave, even though they have acquired additional skills and competencies through their role as a parent. This is where managers have a responsibility to drive change. Make a point of NOT paying your return to workers at their pre-parental leave rate, especially when they are achieving the same outcomes as their male counterparts. Take 15 minutes to identify the penalties applied to your team members working flexibly or taking parental/carer’s leave.

3. Look out for The Confidence Gap

“The Confidence Gap” is a phenomenon where men are typically overconfident in negotiating salaries putting themselves forward for , talking themselves up, whereas women typically talk themselves down. The Confidence Gap is not a sign of proficiency and managers need to understand the confidence gap and how to separate confidence from capability. Am I hearing the opinions of all my team? Do I hear more from those that are louder? Apply the listening rule: ask everyone for their own opinions, but do not allow anyone else to make comment on somebody else’s opinion. That way, you hear from everyone, and can start to value the contributions of all.

4. Pay on potential and slash salary secrecy

Request transparency of annual reviews – one of the biggest challenges we face in pay inequality is the shroud of secrecy that surrounds salaries. Rather than predictable set increases linked to CPI or outdated industry standards, look to reward on performance and potential.

What secrets is your organisation holding, and how do you personally value the contributions of each in your team? Do a quick poll. List the name of everyone in your team. Next to it, estimate the $ value they contribute to the business, versus their actual pay. Record the date of the last time they asked for more responsibility, feedback, a pay rise or a promotion? Finally, if you were that person, what would you do? Be a sponsor; share your counsel.

5. Champion a culture change

Do you know the stories of your employees? How do they perceive your workplace? The ideal worker in Australia is seen as one who has no carer responsibilities and is available 24/7; one that values face time over flexibility. If this is the culture in your team, your employees will be working hard to conceal their carer responsibilities…effort which detracts from their ability to deliver. It also drives inequality of unpaid caring responsibilities, the most significant driver of inequality. Its up to you to create a culture that is inclusive of working parents, and recognizes that caring is at the heart of our humanity. Whether you are a male or female manager, two simple actions can change this: ensure all meetings commence after 9am and finish by 4.30pm, and show its ok to care by picking up additional carer responsibilities in your personal life.