30 January 2018
Category: news
30 January 2018,

Gender Pay Gap – Do you want others to know how much do you earn?

2018 has started with a bang when it comes to the gender pay gap issue.

News headlines abound everywhere.  Firstly, at the BBC with Carrie Gracie resigning over pay equality with colleagues, and John Humphries taking a `voluntary’ massive pay cut from between £600k – £650k to between £250-£300k.  Over at Easyjet, the new CEO took a “pay cut” to £740,000 to match what the former female CEO was earning.

All this is on the back of the rules last year which meant that all organisations employing more than 250 employees much report on their gender pay gap – which affects of over 9,000 private sector employers.  The deadline is April this year, but many companies have published ahead of schedule, as was widely reported earlier this month: www.bbc.co.uk/news.

Reporting Errors

At first glance, the new focus on transparency would be seeming to be having an effect already – witness what is going on at the BBC.  But we will have to see whether this is the case in the long run and across all organisations.

There is a lot of evidence that the old adage: `What gets measured gets done’ is something of a fallacy.  It may be more accurate to say that `what gets measured often gets gamed’.  How much `gaming’ will companies be doing to make sure their data is not as bad as it looks?  At least some, surely.

For example, Hugo Boss initially reported that it had no pay gap between men and women, but the company was forced to revise its data to show a mean gender pay gap of 33% and a median gender pay gap of 77%.  That’s quite some reporting error.

More women into traditional mens’ roles

No doubt a lot of good may come out of the new reporting requirements.  It may encourage some companies to review whether their recruitment and promotion practices are gender-biased, and whether they have true equal pay for equal work.

But I remain sceptical as to whether the reporting requirements will do anything to encourage more women into traditional `male’ industries such as engineering and IT, or men into primary school teaching or nursing.  And without other measures such as universal free child care, women will continue to have longer career breaks than men.

For what it’s worth, my view is that although the new reporting requirements will have some effect, it will not be revolutionary; real change will only come when there is true transparency of earnings –  at all levels and not just high earners.  If we all knew what our colleagues were being paid, it would force both employer and better paid colleagues alike to justify their pay.

Are you happy for others to know exactly what you earn?

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