The Gender Pay Gap continues to rise – what’s the solution?

By Christy Moses

Published on 26-08-2021

31st August is “Equal Pay Day”, which represents the extra 61 days women need to work per annumn order to earn an equivalent wage to men.

The Workplace Gender Equality Agency (WGEA) this month released that the new national gender pay gap has sadly risen by 0.8 percentage points over the last six months to a new figure of 14.2% for full-time employees. This equates to men earning an average of $261.50 per week compared to women. 

Interestingly, the data showed that this gap was largely driven by higher growth in salary for men (1.8% increase) compared to women (0.9%). This is a startling figure as it has been nearly 10 years since the Workplace Gender Equality Act was passed in 2012 and despite a significant effort by the government and Corporate Australia the gap has made little movement over this time and the recent rise indicated that urgent attention is now required.

Why is the gender pay gap increasing?

Reasons for the gender pay gap are complex, therefore quick fixes are not possible, and where they are attempted, they will often shift back. A few of the contributors to the gender pay gap are as follows:

  • Men and women continue to work in gender-biased industries or roles, and those that are female-dominated often have lower average wages.

  • Conscious and unconscious biases continue to affect recruitment and hiring decisions.

  • Women, on average, handle a greater share of unpaid care and domestic responsibilities.

  • Lack of workplace flexibility to accommodate for family responsibilities mean more women decide to opt-out of senior roles (and salaries).

  • When having children, women spend more time out of the workforce than men, which impacts their tenure and career progression as compared to men.

  • The recent COVID-19 crisis has had a greater impact on women and their careers than men.

What can we do?

To be part of the solution to the gender pay gap, it is important to recognise that actions need to be championed at the Executive level. Policy review and changes will likely be required, and regular reviews need to be scheduled to ensure long-term effectiveness. 

Areas to review and those that have been proven to provide positive benefits include:

  • Improving work-life balance and flexible working policies for both men and women; organisations need to actively assume that caring responsibilities are shared amongst men and women and provide equal flexibility options to support this.

  • Moving from “maternity” policies to “paternity” policies with equal leave provisions. This provides greater equality for all and gives permission for men to have more family involvement in the future than they had in the past.

  • Providing Bias education and training to the Executive and Leadership Teams at minimum, and ideally to the entire organisation. It is important to address that both conscious and unconscious biases exist, particularly towards women in leadership roles and when balancing family priorities. This is a topic that needs to be prioritised from an L&D perspective and will also provide wider benefits to organisational diversity and inclusion objectives.

  • Promoting gender balance at all levels of the organisation, particularly at the leadership levels. Organisations who provide an equal “voice at the table” are more likely to be in tune with the requirements of their diverse workforce. 

Awareness and regular reviews are key

It is important to understand that despite best intentions, L&D programs and well-intentioned D&I initiatives, the pay gap will continue to creep back in without regular structured reviews. The most common examples of where this can occur are during annual employee pay reviews, at the hiring stage, at promotion or when returning to work following a period of leave. 

Studies indicate that men continue to negotiate more aggressively than women in regard to salary at commencement and during pay reviews and ask for reviews more frequently. Therefore, it is important for organisations to regularly review and adjust salaries for all employees at all levels, not just those who have asked for it. 

It is also OK for organisations to be transparent about their ambitions to achieve gender parity. This can be brought into a conversation with an employee who is asking for an increase that cannot be met and/or to provide an increase to someone who is not expecting it. Continuing salary reviews and increases over prolonged periods of leave is also a strategy to ensure that women are not at a disadvantage.

At Six Degrees Executive

At Six Degrees Executive, we are proud to say that we have gender balance at our executive and management leadership levels which has been and continues to be a key priority for our CEO, Suzie McInerney

In 2018, we formalised our commitment to diversity and inclusion and one of our first tasks was to conduct a gender pay review and act upon any gaps. We are pleased to say that through this process, we have achieved pay parity and have consequently formalised our review and HR processes to ensure this pay parity is maintained. 

To further support this effort, we recently partnered with The Encoreship, a return-to-work program to support women who have taken a career break and/or were adversely affected by the COVID-19 crisis. Six Degrees is also an alliance member of Inclusive Australia and our organisational commitment to diversity and inclusion was recently recognised through our inclusion on WRK+’s 2021 Australia’s Best Places to Work index.

How we can help

We are firm believers in promoting equality in all that we do and are committed to making a positive difference to our employees, our candidates, our clients, and our communities.

If you are motivated to be part of the gender pay gap solution and don’t want to be a contributor to the problem, please reach out for assistance and advice. We look forward to working together collectively on strategies and solutions to closing the gender pay gap in Australia once and for all. 

Follow us on LinkedIn for more Six Degrees Executive news.