How to Solve the Gender Pay Gap

Has anyone actually thought of just paying the average man and woman the same? Yes, they have, and it works.

Read time: 4 mins

Transparency in companies

Come next year, a long awaited piece of legislation will force companies with 250 or more employees to reveal the salaries, including the bonuses, of all their staff. Some companies have already introduced this, and according to them, its had a beneficial impact on the company. It seems that this honesty and fairness has resulted in people being happier in their jobs.

Currently, the UK gender pay gap stands at somewhere between 10 and 20%.

Taking Active, Positive Steps

What we’ve learnt from the past few decades is that simply having pay equality legislation isn’t enough; it's no longer the root of the problem. Data suggests that part of the pay gap is down to the fields of work that are filled by predominantly male workers and female workers respectively. Think tech., finance, construction etc. Many will argue that there are just more male recruits who choose to enter these better-paid industries than there are female. Their solution would be to do more to actively encourage young women to enter these sectors. While this is something we all should be doing - offering equal opportunities - there is another, more straightforward solution for eliminating the gender pay gap which tackles the issue from the top down. The second reason that on average men have higher incomes than women is because of the different mid-ranking positions they hold in private businesses. Companies could just pay women the same as men, and move on from there.

 

Turning the problem upside-down & working backwards

Why shouldn't this work? The public sector has more regulation and transparency, but the private sector is more flexible and dynamic. The two sectors can’t be treated as the same in every respect. 

Brainlabs is a perfect example of a business implementing a social policy for economic benefit. Instead of trying to create a more suitable environment and waiting for the problem to gradually fix itself, they’ve decided to just turn the problem upside down and work backwards from there. They found out that their average male salary was 8.6% higher than the average female. So they introduced what they call a ‘Pay Gap Tax’ and increased the average salary they paid their female employees so that the average salary was the same regardless of gender. To be as fair as possible, the increase was proportionate to employees’ experience and their role within the company. 

Where is the good business in this? you might ask. A good question. They then work backwards, ensuring that the workload is equal depending on the salary of each employee. Brainlabs have promised to repeat this exercise each year to maintain the equality they have established. In the meantime, they’re hiring...

Liberalising the Workplace for Parents

Aside from simply introducing gender equal pay there are a few other things we could and should do, that as well as solving some of the causes of the gender pay gap will also benefit society in other ways. Research from the IFS (Institute for Fiscal Studies) shows that the gender pay gap grows and eventually doubles for women who decide to have children [3]. Women should not have to face the burden of sacrificing part of their career potential just to have a family just because they are women. There are some relatively simple liberal changes that can be introduced that would have enormously beneficial effects for both parents, their employers, and the country as a whole. 

Subsidising Childcare will not only give employees the option of returning to work sooner, it also gives people with children the option of taking a job if they want to. According to the Women’s Equality Party, 600,000 stay-at-home parents would prefer to work if only they could afford childcare.

Allowing Babies in the Workplace would be a good alternative to people who want to go back to their jobs but don’t want to enrol in childcare. It will also help people who want to have babies but don’t want to feel like they’re putting their career on hold. It may seem a bold move but Italian MEP has already made a precedent by juggling her two tasks at once. And corporate investment giants Goldman Sachs have since expanded on-site nurseries that take children up to the age of three. Employees get 4 weeks free when returning from maternity leave and have the option of using it on a cost basis.

Increasing Paternity Leave would ensure that workplace flexibility benefits both men and a couple as a whole. Currently, a man gets 2 weeks paternity leave while a woman is entitled to sixth months Ordinary Maternity Leave and an extra 6 months Additional. But, if the mother wants to return to work and the father wants to stay at home to care for their baby, he’s faced with a choice of using taking off annual leave or even quitting his job.

Working from Home is becoming more and more popular in the digital age, with the TUC reporting as many as 4 million people worked from home in the last year. This should be a way for new parents to keep in touch with work and lots of people do find that they are more productive working in the comfort of their own home.  However, this should only be seen as a temporary solution because, as I wrote last month, being a visible person in the workplace is the absolute key to career success.

It's been almost a hundred years since women got the vote in this country. Since then, things have gradually been moving away from an unequal society favouring the wealthy white man to a society that suits all and gives everyone an equal chance. But as Barack Obama said, we are the change we seek, change will not come if we wait for some other person or some other time. We must be the change we seek if we want to live in a world that is fair for all. As Brainlabs have decided, the big changes must come first, we can work out the details later.


On Spike’s journey through life, he has walked 550 miles across Spain, spent 6 months in a tent in Australia surfing, hiking, and jumping off waterfalls; while funding himself busking with his guitar, volunteered at an english school in the Cambodian countryside, and got married on a deserted beach in Fiji. Spike has documented his travels through his blog, and his instagram. After travelling the world for four years, he now studies law in London where he lives with his Catalan wife.