At present there is no legal obligation to do anything more with your pay gap than publish it on your website, not necessarily accompanied by any form of explanation or other comment at all. Most employers caught by the current gender pay gap regulations (about 10,000 of them) have added some form of narrative, but these vary very widely in terms of length, style and in particular, statements of intention to do anything concrete about it.
We will soon be approaching the point where the first generation of GPG reports need to be updated, so what can you say you have done or will do to address your pay gap?
The Government Equalities Office’s new “What Works Guidelines” suggest these measures:
- Including “multiple women” in shortlists for recruitments and promotions. Ok, but remember that positive discrimination is unlawful. If you include women on a shortlist at the expense of notionally better-qualified men, then even with the best of intentions, that will be less favourable treatment of the men on gender grounds. You can only “rig” shortlists in that way where the men and women are “as qualified”, i.e. where you are (gender aside) not much fussed as to who you recruit/promote. However, at the sort of senior level likely to make any difference to your pay gap, how often can it genuinely be said that an employer has no preference between candidates?
- Use skills-based assessment tasks in recruitment, i.e. ask candidates to perform the tasks they would be expected to carry out in the role. This is aimed at finding who is actually best for the role, not who is best at saying that they would be best at it.
- Use structured interviews for recruitment and promotion and to minimise unfair bias.
- Communicate the salary range on offer to encourage women to negotiate their salary. A nice idea clearly aimed at women’s traditionally-reported hesitation about these things, but surely not realistic in circumstances where that will encourage men too and employers would prefer in either case not to pay more than they have to. It also creates the question of how you explain to the successful candidate of either gender why, despite their being the best of the crop, you are not paying them at the top of the band. Now there is a happy start to the relationship!
- Introduce transparency to promotion and pay processes, such that employees have a clearer idea of what pushes the remuneration committee’s buttons in their favour and managers understand that their decisions must be objective and evidence-based. This is not, cannot, be the same as a fully mechanical remuneration process, since the number of performance variables at the senior levels where these measures make the most difference would clearly prevent that. However, more evidence of thought and fewer moistened fingers in the wind could quite inadvertently produce better outcomes.
- Appoint a diversity manager/task force to reduce biased decisions in recruitment and promotion. Well, ok again, but who decides what constitutes a “biased decision” if the individual in question does not challenge it? Is this any promotion which goes to a man despite there being women on the shortlist? Or is it any appointment made from a shortlist without any women on it at all? Does that manager have to vet the CVs or sit in on all the interviews to see personally how candidates perform? And what if that diversity manager has different subjective views on that performance from those charged with actually effecting the hire?
What is odd is that the Guidelines do not suggest that employers start by finding out why they have a gap in the first place. We can assume in most cases that this will not be like-for-like pay inequality, but instead an uneven distribution of men at higher-paid senior level. So why is this? Do you have equal numbers of men and women applying at the bottom end? If not, why? If so, is approximately the same proportion of candidates of each gender appointed? If so, at what point in the hierarchy do those proportions most sharply diverge? Is it an issue of women not applying for senior roles, or of their (proportionately-speaking) not getting them?
In the end, unless you do have some really very backward executives on the remuneration committee, a principal issue behind a pay gap is likely to be job design, i.e. the perceived tension between some senior level roles and the flexible working arrangements which many women (especially new mothers) prefer. Do what you can to challenge the orthodoxy that senior roles and flexible working don’t match, the Guidelines should have said, and then you will see more women in those senior positions. Without those basic structural enquiries, these measures risk being a bandage, not a cure.