Whilst some progress has been made in closing the gender pay gap, the pace has been disappointingly slow. The initiation of gender pay gap reporting in 2022 provided a more precise delineation of the issue across corporations and sectors, spotlighting those areas that need more concentrated efforts to even out the discrepancy.
Over the previous decade, the gender pay gap in Europe shrunk by 3.7 percentage points. However, a disparity of 12.7 per cent still exists across the EU in 2022, with the range fluctuating significantly from country to country; the gap is as minimal as -0.7 per cent in Luxembourg and as expansive as 21.3 per cent in Estonia. With a gender pay gap of 9.6 per cent, Ireland sits somewhat in the middle, according to the most recent figures from the Central Statistics Office.
According to Michelle O’Keeffe, co-creator of Platform55, a company championing gender equality in businesses, there are several promising signs. The introduction of new laws relating to equality, pay transparency, and ESG (environmental, social and governance issues) has raised awareness amongst companies. She highlights the axiom ‘what gets monitored gets managed’ to underscore the importance of reporting in this regard. However, O’Keeffe insists it goes beyond simply generating data, companies should also focus on crafting a robust narrative about their action plans to foster enduring change.
Gillian Harford, the country executive at the 30% Club Ireland, confirms the ‘definite progress’ made in regards to the gender pay gap. Harford acknowledges that changes within some corporations may be somewhat understated, but applauds the gender pay gap reporting for shifting the discourse from pay to representation. Harford emphasises the issue arises from an unequal distribution of gender representation at various levels within an organisation. Even though an organisation might have an equal male to female ratio, the representation can be highly skewed, leaning more heavily towards one gender at the top and the other at the bottom.
Underrepresentation, particularly in high-paying roles within sales or technology departments, remains a key concern, as women are often not found in senior positions within these areas, thus contributing to a gender pay gap. Although the advent of gender pay gap reporting has brought attention to this, changes will not occur instantaneously.
According to Harford, understanding the root cause of the gender pay gap and beginning to contemplate appropriate solutions are the primary avenues for driving change in companies. As of this year, organisations employing over 150 persons must disclose their gender pay gap, and by 2025, firms with more than 50 employees will also be subject to this mandate.
Harford anticipates new employers will release their own gender pay disparity reports this year, possibly revealing revealing fresh approaches as well as having an impact on national averages. Christine Aumayr-Pintar, a senior research analyst at Eurofound, confirms that measures like gender pay gap reporting in Ireland are becoming popular in the EU and beyond.
The goals are to lessen secrecy around pay, allow workers to understand how their wages compare to those of their gender-opposed colleagues, publicise pay gaps internally and externally, and closely examine a company’s remuneration and job assessment methods. The latter, also known as pay audits, are deemed the most advantageous by both managers and employee representatives.
According to current research from the UK, Denmark, and Switzerland, gender pay gap reporting has positively influenced the reduction of pay disparities, granted they are well executed. Aumayr-Pinter agrees with Harford that incentivising women to venture into superior paid sectors and positions forms part of the solution but acknowledges that urging a shift towards high-paying sectors dominated by men has proven to be especially challenging. A practical method to tackle the pay gap is to decrease pay differentials between sectors, but doing so necessitates effective intersectoral wage coordination, she adds.
Doone O’Doherty, a tax workforce partner at PwC Ireland, has been examining the nation’s reports for 2022 and 2023. Although she believes it’s too early to discern any substantial trends yet, she emphasises the importance of understanding the driving factors behind the pay difference. O’Doherty highlights efforts to close the pay gap can be time-consuming and conditions may even deteriorate before they get better.
Many businesses are working on developing a reservoir of female talent, particularly in typically male-dominated positions, which O’Doherty notes is a commendable initiative. However, she also acknowledges that it may take several years to see a significant influence on the gender pay disparity. The compound effect of a robust job market and high staff turnover over recent years has also been causing greater fluctuation in pay gaps.
O’Keeffe suggests that the fundamental reasons behind women’s lower pay primarily stem from societal issues that are more complex to address. She identifies the “motherhood penalty” as the unarguable cause of the gender pay gap, with the World Economic Forum attributing up to 80 per cent of the pay gap to this factor. According to O’Keeffe, regardless of the age of their children, women often have to make tough choices between their career and family in the absence of flexible working options.
O’Keeffe warns that, based on current progress, it will take approximately 130 years to reach gender parity in the workplace. She highlights the lack of parents, specifically fathers, taking full family leave as a significant obstacle to gender equality progress. As a result, women in heterosexual partnerships predominantly carry the child-rearing responsibility. To address these issues, Platform55 advocates for organisations to take concrete steps, including managing overwhelm in the workplace, offering part-time positions, promoting paternal leave, and valuing employees based on their output rather than working hours.
O’Keeffe suggests that the disparity will continue to persist unless corporations take steps to assist those with caregiving responsibilities to advance in their professional journeys.