With organisations employing above 250 people statutorily required to publish their gender pay gap starting in spring 2018, and with reported shortfalls in compliance, it may be time for organisations to include a discussion on the whys and wherefores at the next board meeting.
And it’s not just a compliance factor. If corporate leaders embrace the notion of a ‘resource-based’ view when setting business strategy, in pursuit of sustainable competitive advantage, that’s another reason to have a look at what enables and constrains the organisation’s diversity. If the strategy for connecting with customers is to ensure thinking around products and services is empathetically reflective of the population ‘out there’, then it flows logically that managerial culture – and the makeup of leadership teams – needs to match that.
It has been claimed that the gender pay gap is to some extent at least explained by assumptions on the part of employers that part-time employees are less productive (1). This view is underscored by academic research suggestive that a gap between the pay of men and women working full-time compared with part-timer women is not explainable on the basis of relative human capital (i.e. the skills and other attributes making people valuable to organisations who may employ them).
A linked factor is the ‘long working hours culture’ in many professional environments – one that has limited women’s choice in labour market participation. A 2008 study cites “the division of domestic labour” as an explanatory factor, i.e. the relative propensity of women to combine work with caring responsibilities, whether child or elder care (2). In other words, social choices by vested interests about what counts in judging productivity rather than objective norms have created and maintain unfair conditions for working women.
To repeat, academic research suggests an intricate connection between the gender pay gap and men and women’s patterns of working. That is in occupational choices and in job market participation history – specifically the propensity to take up flexible and part-time working.
Government regulation since 2014 provides for individuals to request “a way of working that suits an employee’s needs, e.g. having flexible start and finish times, or working from home”. And for employers to be required to give due consideration to such requests. Requests that any employee is eligible to make, not just parents or carers, provided they have worked for the same employer for at least 26 weeks. Refusals require “a good business reason for doing so”. (3)
We have three things in play here, then. Statutory compliance with the Flexible Working Regulations. Gender Pay Gap reporting. And corporate efforts to secure and sustain competitive advantage, as part of company directors’ fiduciary duties to assure going concerns. Even if the organisation is a not-for-profit, actions which secure a relative advantage over other employers are significant if the aim is to ensure a win in the ‘war for talent’.
Independent commentators (4) have observed that there is a flaw in reliance on regulation to promote flexibility sometimes under the more neutral guise of ‘work-life balance’ and, in turn, closure of the gender pay gap. Placing the focus on negotiation between individuals and organisations that have become increasingly greedy about securing people’s time can be a trap. Aided and abetted by access to digital technology. Although used to meet the employee’s need consistent with the government definition of flexible working, the latter could become an enabler by removing the need for employment to be location bound.
As things stand, taking the flexible work option may further accentuate gender pay gaps, unless and until flexible working becomes the norm, thereby socially legitimising this as the default for men and women. Legitimised outcomes under current conditions may simply serve to sanction arguments that women are choosing not to work long hours or to aim for top jobs.
Commencement of gender pay gap reporting in 2018 is merely that – a start, creating over time a longitudinal trend line to inform monitoring and potential redress for evidenced injustice. It has been suggested (5) that progressive employers will: normalise views of non-fulltime work on a gender-blind basis; correct inaccurate assumptions that such working patterns are less valuable to organisational effectiveness; positively recognise not penalise atypical, non-linear career paths.
Rounding off, here are five questions for the board:
- How important is it for our workforce to reflect our customer base, bearing in mind the value of diversity in creative thinking and action?
- What does an audit of our diversity tell us?
- What are we going to do about it?
- What decisions do we make about people resourcing for key roles that are habit- rather than rationally-determined (job sharing, flexible working, telecommuting)?
- What sources of help are there to enable informed, sustainable action in this arena?
- Smithson, S. Lewis, C. Cooper and J. Dyer (2004) ‘Flexible working and the gender pay gap in the accountancy profession’, Work, Employment and Society 18(1): 115-135.
- Lyonette and R. Crompton (2008) ‘The only way is up? : An examination of women’s “under-achievement” in the accountancy profession in the UK’, Gender in Management: An International Journal 23 (7): 506-521.
- uk (undated) Flexible Working guidance, accessible at www.gov.uk/flexible-working.
- Brandth, B. and Kvande, E. (2001) ‘Flexible work and flexible fathers’, Work, Employment and Society 15(2): 251–67.
- Rowley, C. (2018) ‘Gender pay gap reporting’, Vertical Distinct, April 28th.