Mind the Gap: How to Achieve Pay Equity
It’s going to take 257 years to close the gender pay gaps at the current rate of change – literally, none of us has that long to wait.
82% of companies have pay disparities. 1 in 3 employees perceives pay inequities in their organization and 58% of employees would consider switching jobs for more pay transparency. Gender, race, sexuality, disability, are all factors. If we closed pay gaps, it would contribute an estimated extra £1.5 billion to the UK economy.
The reasons for pay equity gaps are many and reveal where organizational privilege, power, access and influence sit. Closing pay gaps requires a systemic approach to tackle at organizational and sector level.
Why does the gender pay gap still exist?
Women are four times less likely than men to start a salary negotiation and ask for around 30% less when they do. This means they have lower starting salaries and receive fewer salary increases, which contributes to creating and growing the gender pay gap over time.
However, it’s not as simple as encouraging women to negotiate more. Pay negotiations can be a minefield for women. Women who do choose to negotiate find themselves in a double bind. Society unconsciously expects women to be likeable and communal. When women negotiate they risk being seen as competent but not likeable, and individual-focused rather than communal. Women who negotiate face a far greater risk than men of being penalized for doing so. Penalties include damage to their reputation, receiving smaller increases than men and even the withdrawal of job offers. These penalties can be more extreme for women of colour or women holding other marginalized identities.
In organizations where pay scales are opaque or where pay bands are very wide, it’s hard for people to know how their pay compares to that of their colleagues. Women working in these organizations need good data in order to reduce the chances of being penalized for negotiating, but the data may not be easily available.
Creating pay equity
If you’re a leader inside an organization here’s what you can do to play your part in reducing pay inequity:
- Create fair and transparent pay systems and publish pay bands – and the gender, age and ethnicity spread in pay bands – so that people know how their salary rates against the average and the upper point in their pay band.
- Have a clear policy on salary negotiations. If negotiation is an unspoken part of your culture, then give women permission to negotiate, and monitor negotiation outcomes on starting salary and salary increases by gender. Create negotiation standards to help leaders see when potential decisions are markedly outside of the norm.
- Remove rules that stop colleagues from talking about pay.
- Continue to publish gender pay data, including intersectional pay data and, where possible, publish it internally by function and business unit.
Women can tend not to ask for promotions and pay increases (research suggests 61% of women would rather talk about their own death than talk about money!) Given the bias that permeates workplaces as we explored above, perhaps you’re assuming that your good work will speak for itself. It won’t and it doesn’t. You have to ask.
Tips for women in business to ensure they are getting an equal wage
Start by doing your research
There are 3 parts to this. Firstly, take a data audit. Find out what’s the gender and ethnicity pay gap inside your organization and whether or not it’s published publicly (UK businesses with over 250 employees have to publish gender pay gap data, you can find and compare gender pay gap data here). Ask what your company measures and why or why not. What data is or is not available, and how transparent this data is.
Secondly, ask around. Ask your HR business partner, ask your boss, ask your boss’s boss, about pay gaps inside your company. Talk to your peers, ask them to share what they’re paid. Join an employee engagement group and start up a conversation about pay, pay equity and pay transparency.
Thirdly, look externally. What’s the market value for roles similar to yours? What are others paid? This is only a guide for you, there will always be people paid less and paid more. Just know that if you’re female and holding marginalized identities you’re likely undercharging for your labour.
Prepare for a pay rise conversation
Ahead of your meeting decide your bandwidth, the top number that you’d love to achieve and the minimum you can accept. Consider what are the other factors that are important to you and your workplace wellbeing, e.g. flexible working, employee benefits.
Then prepare your case. Include the data you’ve researched about similar roles. Build a case with your personal positioning around the value that you bring to your work, your clients, your team, the wider organisation. Show the monetary or equivalent value you are adding with your work and demonstrate with examples. Have you brought in new clients and what’s the lifetime value to the company, have you been involved with company culture initiatives that benefit the wider employee engagement picture, attracted new talent, boosted staff morale and retention. Think creatively about the wider value you add to your team, colleagues and company culture, beyond monetary value.
Ahead of your meeting remind yourself that any negotiation is a dance, not a fight and there’s always a win-win to be found. Use affirmations and visualizations to enhance your mindset, support strong self-belief and calm your nervous system.
During the meeting, pay gap expert Michelle Gyimah recommends staying curious and asking lots of questions including using leading questions to help you reach an agreement. ‘How can we get closer to...’, ‘is there any way to work this out…’, ‘what do you need to make this easy for you to say yes..’, ‘tell me your concerns about…’
When you share your number, hold the silence! It’s tempting to fill the space but hold your ground.
After you’ve asked and received an answer, it may not be the one you wanted, but at least now you know and you’re in a better position to make decisions about your next steps (accept, appeal, look for alternative employment).
After the meeting, prepare to follow up with awareness-raising articles and data points, to share what you’ve discovered about pay equity with your senior stakeholders. Take the courage to use your voice and influence to advocate and improve your company’s situation for others, as well as for yourself.
Moving towards pay equity won’t be quick or easy, and it will get uncomfortable; there are centuries worth of societal and business structures to dismantle. But it is achievable and through these steps, we can all embrace equity to ensure that everyone has a fair and equal wage.
Want to read more about this topic? Katy Murray shares some further reading:
Gender Pay Gap What Next by Niteo Development and Catalyst Collective 2019 and Otta for more on what causes pay gaps and how to address them systemically and structurally.
Michelle Gyimah on how to negotiate better pay with Michelle Gyimah and Dr Nikki Ramskill and Global Quality Collective.
Cash is Queen Davinia Tomlinson 2023 for practical negotiation and money mindset tips.
Gap Square for more about why pay equity is business critical and useful if your senior stakeholders need a business case.