Minding the gap

A recent survey from multinational Irish company Taxback.com states that twice as many women than men have seen the gender pay gap in action, while one in three feel that employers aren’t willing to invest in women. This is from the first instalment of their Taxpayer Sentiment Survey 2020, which also notes that 69% of Irish taxpayers say the pay gap is real and palpable in Ireland’s workplaces.

Prior to the general election, the Government was in its final stages of approving new legislation surrounding the gender pay gap. When launched, the legislation will initially see companies of 250 employees or more mandatorily reporting on their practises and policies surrounding the pay gap, and the steps being taken in terms of correction. Eventually, any public or private sector company in Ireland with 50 or more employees will have to report on their income practises and their approach to the gender pay gap.

The current private secretary to Minister for Justice and Equality Charlie Flanagan Conor Cleary says, in correspondence with Irish Country Living, that addressing the gender pay gap is a key commitment as part of the Government’s National Strategy for Women and Girls 2017-2020.

“It is intended that mandatory reporting will incentivise employers to take measures to address the issue insofar as they can,” he writes. “Measures such as those included in the bill have been taken in a number of other countries and, indeed, EU member states were encouraged to take such measures in an EU Commission Recommendation.”

The legislation has been based upon the UK model, which has been in effect for the last two years. It will take a tiered approach to the gender pay gap, since many businesses report that their pay gap comes from the lack of women in senior management roles. Before the Dáil was dissolved on 14 January 2020, the legislation was awaiting reporting stage after being originally published in April of 2019.

The UK’s legislation has led to a slight decrease in the country’s pay gap, from 17.8% to 17.3%, since its inception. The UK government website states that it continues to decline.

Commitment issues

The most recent Pay and Employment Practises Survey for the Chartered Institute of Personnel and Development (CIPD) – which has not yet been published – continues to show a lack of commitment from most Irish companies to provide gender pay gap information, even in anticipation of this legislation coming into effect.

Director of CIPD Ireland Mary Connaughton says this lack of movement can be attributed to many things, but also to the fact that many companies in Ireland still believe the pay gap is not a serious issue within their organisations.

“Sixty per cent of the organisations (surveyed) said, ‘No, we don’t think that we have a gender pay gap’,” she says. “We don’t think that is an accurate representation. [The pay gap] has been around 14% for some time; it’s not improving. So there are certainly companies out there who think that they don’t have a gender pay gap, but it’s likely that they do.”

Mary says that, from the data retrieved from their (as yet unpublished) 2020 survey, only a third of Irish businesses are addressing the gender pay gap issue in anticipation of the incoming legislation.

She is unsure as to what tangible change will arise from the legislation, which will only require reporting on the gender pay gap as opposed to implementing real change, but she believes this is the first step required to close the gap.

“[The UK’s pay gap] hasn’t changed much between those two years, but it’s putting the spotlight on the pay gap and getting companies to see what they can do about it,” she explains. “The next challenge is to get companies to change some of their practises so they can reduce the gender pay gap.

“[Our hope is] they end up with, for example, more flexibility, which helps more women get into senior positions, more fair recruitment and selection and more transparency around their overall pay and reward process.”

Discussion and debate

The Taxback.com report says that 42% of those surveyed feel that longer service should automatically equate to higher pay, while 24% felt that higher qualifications is the more important factor. However, when considering the challenges faced by the majority of working women, neither address the true cause of the gender pay gap.

Mary feels that the challenges faced by women in the workplace require more of a cultural change to really make a difference.

“A lot more women with children end up working fewer hours – or they don’t take up promotion opportunities – so they don’t end up on a strong pay or career trajectory,” she says. “Workplace flexibility, facilitating working mothers and removing the bias of thinking that [working mothers] might not be committed to their career is central to tackling some of this.”

Real positive change

Irish Business and Employers Confederation (IBEC) was heavily involved in the development of the gender pay gap legislation. Head of social policy at IBEC Kara McGann says that this legislation hasn’t been put forward to scare anyone – the implementation will, in effect, lead to positive discussions within organisations on how best to tackle the issue.

“There is certainly a concern in people’s perception about what this legislation will change,” she says. “Employers are only one part of the approach that needs to happen if we’re serious about making a real, positive change. We also need to raise awareness about what it is that we’re actually measuring. We work closely with many businesses (including agriculture and food) to look more closely at issues surrounding diversity, inclusion and gender balance. Progress is happening.”

Kara also emphasises that businesses need to be doing more to prepare for the incoming legislation.

“One thing that has delayed [businesses] is a lack of a methodology – what’s missing are the technical details,” she explains.

“There are a number of anomalies in the UK model we hope we won’t see in Ireland [when the legislation comes into effect]. This has delayed some employers from getting going, but we’re encouraging them to start looking at their data, and telling them to look at the UK model as an approximate.”

Just this week, Bank of Ireland pre-emptively published their gender pay gap data, noting it currently stands at 24.2% (based on a company-wide average). They state that this is due to fewer women in managerial positions but, as per their goal of establishing a 50:50 gender balance in managerial positions by 2021, the number of women in senior management has increased over the past year, from 38% in 2018 to 44% in 2019.

Irish Country Living reached out to several of the nation’s largest agricultural organisations, including Glanbia, Teagasc and Kerrygroup, enquiring on their plans for when the legislation comes in. While Kerrygroup declined to respond at this time, Teagasc say they have been measuring their gender pay gap for the past three years and a gender and diversity focus is a major aspect of their People Strategy, which was launched in 2018.

Their current gap (unspecified) is attributable to more women availing of their family-friendly leave programmes (some of which are unpaid) and fewer women in upper management roles. Glanbia’s head of corporate communications Martha Kavanagh says: “Glanbia is committed to the principles of diversity and inclusion and to gender equality. In 2019, we undertook a comprehensive analysis of gender representation and gender pay across the organisation” and “further work in this area will continue in 2020 and we will report in line with the legislation from next year.”

The UK’s Gender Pay Gap Reporting legislation came into effect in 2017 and requires all companies in Great Britain (Northern Ireland was excluded) with more than 250 employees to report on their gender pay gap at the end of each fiscal year. This includes reporting the breakdown of men and women in managerial positions, different pay brackets and noting how many men and women are in receipt of annual bonuses. They must publish their annual report on their website and also submit the data to the government.

This transparent approach to reporting on each individual company’s pay gap is meant to start a wider conversation on how more women can enter into areas of full-time employment (it is reported that the pay gap is largely attributed to more women working part time than men), larger pay brackets and managerial roles.

The UK model is upon what the Irish legislation will be based, with adjustments made in areas where the UK’s legislation has shown inconsistencies. Overall, the UK’s legislation has not dramatically decreased the gender pay gap. Reports of companies providing incorrect data have arisen and, though the government has threatened those in breach of the legislation with fines, there have been none reported to date.