Gender Pay Gap: PR exercise or serious business commitment?

Friday 06th April

This week, the gender pay gap has dominated news headlines as businesses rush to publish their figures ahead of the Government’s deadline. Now it’s been revealed that, on average, 78% of UK companies pay women less than men Ellie Riddles looks at what’s next for businesses who need to prove they are effectively tackling the issue.

What happened?

Wednesday 4th April 2018 marked the deadline for companies with over 250 employees in the UK to publish their gender pay gap figures.

While many businesses published their results in advance, thousands of companies rushed to publish their results on deadline day. Whether this was a tactical decision or simply down to disorganisation, many businesses – in the short term at least – avoided the scrutiny that other companies received when journalists had time to delve into their figures.

Journalists have now begun to pick over the results of over 10,000 businesses across the UK. The picture isn’t pretty – 78% of firms pay men more than women on average, while 14% pay women more, based on the median measure.

What has the reaction been?

The gender pay gap story has been on top of journalists “to write” lists for over a year and has grown in profile as the reporting deadline loomed. This week’s reporting by businesses has triggered a feeding frenzy across Fleet Street but the reaction to the overall figures has produced a very mixed bag.

On the morning of the deadline, Theresa May led the charge by tweeting about the “burning injustice” the figures showed. The Labour Party reacted to the news with a five-point plan to close the gender pay gap.

As politicians tweeted about the importance of the figures, news outlets were busy getting first-hand opinions from women on their reaction to the news that men at their company are, on average, paid more than them.

The majority of businesses praised the exercise as a positive step in the right direction for UK organisations to close the gender pay gap. Similarly, businesses used the reporting obligation to outline their proposals for achieving gender parity in the workplace.

However, some companies chose to criticise the reporting methodology, arguing that it does not paint a fair picture of their business. This has been the reactive line issued by many businesses who sought to justify their results by stating ‘we have less senior women, so our results are unbalanced’. This has been a difficult message to land in such febrile atmosphere.

However, Helena Morrisey, who founded the 30% club, made a very interesting observation. Fewer than 200 companies responded to the Government’s 2016 consultation on the reporting methodology. Perhaps such complaints would have resonated more if companies had engaged sooner?

What next?

While businesses are no doubt breathing a sigh of relief that their figures are submitted, they cannot rest on their laurels for too long. As part of the legislation, companies will now need to report their gender pay gap results every year. If the 2018 reporting was the moment to declare the status quo then the pressure will really be felt in 2019 when companies will be expected to demonstrate considerable progress. The Commons Business Committee has also recently announced an inquiry into companies reporting of the gender pay gap, which will mean that the issue will continue to dominate the political debate and headlines in weeks to come.

With the levels of scrutiny that businesses now face, gender pay figures have become more than a “PR exercise”. Given the reputational risk these external audiences (and internal staff) pose, businesses will have to go beyond their communications teams and develop multiple divisions – from HR teams to senior management – to take tangible steps to tackle the issue.

Internal communications within companies is now more important than ever. Ensuring that your staff understand and are engaged with plans to reduce the gender pay gap is crucial. Declining trust within an organisation poses both a serious reputational threat and will prove problems as businesses try to attract the best talent. Given the heightened responses seen with gender pay gap results, it is an issue that will remain for years to come.

Within only the short timeframe of a year, businesses will face a tough challenge to implement tangible changes that will be accepted by an increasingly engaged workforce and sceptical public. It will become increasingly clear who is using this opportunity to genuinely address disparities in gender pay and those who view the reporting as a necessity they want to get over and done with.

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