Is the gender pay gap being ignored by bosses?

- Leadership - Mar 21, 2017

New research has found skepticism at the prospect of government legislation aimed at reducing the gender pay divide, with many business leaders not even seeing it as an issue for their enterprises.

Over a quarter (29 percent) of senior personnel within UK enterprises do not see the gender pay gap as an issue for businesses, despite the UK gender pay gap sitting at 13.9 percent according to the Fawcett Society for full time employees. This is according to research by HR and payroll provider NGA Human Resources (NGA HR).

Those that do recognise the gender pay gap as an issue believe the external effects on an organisation create the biggest problems - these include bad publicity (40 percent), brand damage (34 percent) and recruitment obstacles (33 percent). Challenges such as retaining staff (26 percent) and pay rise demands (20 percent) are viewed as secondary issues for businesses.

In addition, many of those questioned stated that they believed that the gender pay gap was partly due to women’s personal career decisions. The fact that women are more likely to take career breaks (49 percent) or work part-time (42 percent) are identified as the main factors for pay disparities. Other reasons for the gender pay gap are the lack of representation of women in the overall workforce (20 percent) and fewer women in senior management positions (27 percent).

Despite Government initiatives, only 17 percent of decision makers surveyed believe that regulations on gender splits will reduce the divide. Especially topical given firms are required to report on pay gaps from next month, the research indicates this might not prove as successful as hoped. Indeed, 20 percent of organisations will not be ready to disclose their data on time, let alone review remuneration packages as a result.

To combat the gender pay gap, pay levelling is unsurprisingly seen as the number one solution (57 percent). However, in line with the reasons highlighted for the gap, there is also significant support for back-to-work schemes (49 percent) and positive recruitment programmes, such as the Government’s budget funding for ‘returnships’ (47 percent).

“It is cause for concern that a significant proportion of business leaders still do not take the gender pay gap seriously. Whilst compulsory reporting is imminent, progress towards closing the gap will only be made if firms are prepared to put in place meaningful programmes. The Government’s recent funding for ‘returnships’ is a step in the right direction, yet it is up to individual businesses to develop them if the pay gap is to be reduced for good. By addressing their pay gap, organisations will not just have good figures to report on paper, but the commercial benefits of a diverse and fairly remunerated workforce, improving performance, productivity and profitability”, said Geoff Pearce, Managing Consultant – Reward at NGA HR.

Other findings from the research include:

  • Men in senior positions are much less likely to see the gender pay gap as an issue than women – a third of men (35 percent) compared to a fifth of women (22 percent)
  • Men are also twice as likely than women to think a gender pay gap plan isn’t necessary – 14 percent compared with 7 percent of women
  • Whilst the Government is bringing in gender pay gap reporting on 6th April, a fifth of firms (20 percent) will not be ready to start reporting from this date 

The survey, conducted by 3Gem on behalf of NGA HR, questioned 250 senior decision makers within UK businesses to whom gender pay gap reporting will apply when new regulations come into play in April.

Read the March 2017 issue of Business Review Europe magazine. 

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