Each one of us may have experienced inequality in pay between genders at some point of time. We all know that on an average, male employees are paid better as compared to their female counterparts. This gap exists across all the geographies, sectors and job levels, be it rural, urban or metro cities or it is corporate, organized or unorganized sector or white collar or blue-collar jobs.
There are several factors which play a vital role in deciding the compensation for any role, like age, gender, location, work experience, appearance etc However, when we talk about diversity and Inclusion, it plays a huge role in our decision making methodology and clearly reflects the credibility gap and biasness on the basis of gender.
In India, females on average earn 65% of what their male counterparts earn for the same job.
According to ADP’s study ‘People at work 2021: A Global Workforce view’, in India only 65% of women received the pay rise or bonus of taking on extra responsibilities or a new role as compared to 70% of men.
So, before getting into remedies of fixing the gap let’s understand the cause behind this. The major cause is lack of higher education, training, equal opportunities, exposure to leadership positions, career break etc.
|Gender Statistic Measure||Female||Male||Growth %|
|Infant Mortality Rate (per 1000 live births)||44.3||43.5||1.8%|
|Life expectancy at birth||68||64.5||5.4%|
|Expecting years of schooling||11.3||11.8||(4.2%)|
|Primary school completion||96.6||96.3||0.3%|
|Lower Secondary school completion||76.0||77.9||(2.4%)|
|Secondary school education||46.0||54.0||(14.8%)|
|Employed in agriculture||59.8||43.0||39.1%|
|Employed in Industries||20.7||26.0||(20.4%)|
Source: Wikipedia data based on year 2012
We can observe even expected schooling of female is negative by 4.2% as compared to male and the gap is getting wider to 14.8% in secondary school education. This is causing their low participation in industries and increasing their involvement in agriculture. Though our literacy rate is improving but still we must go a long way. Literacy rate of female is 65.46% as compared to male 82.14%.
The rationale behind mentioning this statistic here is, education is directly proportionate to job opportunities and compensation.
To bridge the gap, we need to ensure better participation by women in workforce and paving the way for them to attain senior and leadership positions. We have to provide them the environment of equal opportunity where they can showcase their ability, skill and knowledge and elevate their career to higher positions.
In India, according to Monster Salary Index published in Mar-19 the pay gap between men & women was 19%, this means women in India earn 19% less than man for the same nature of job. This gap is even wider in IT and manufacturing which is 26% & 24% respectively.
Bridging this gap is not an overnight process and for this we need to create the culture, process and inclusivity in organizations. Here are some ways which organizations can follow in order to reduce the gender pay gap:
- Opportunity to women who have taken career breaks: In certain industries we have strong bias while hiring women who have had breaks in their career. This can be because of any reason like maternity, childcare, caring for old age parents or health issues. We have to accept the fact that taking break from career is not a sin and we should respect that and provide an equal opportunity to such women. Long-time absence from work also has a negative impact on their salaries. Ideally, they should not get penalized for taking a break.
- Competency based compensation: “What is your current CTC?”, we all must have faced this question at least once in our career. We should move on competency-based compensation instead of current or last drawn (in case candidate is not working) CTC. Competency based CTC is a more scientific method to deal with this issue and helps us to negate the impact of biasness. Practise role based compensation benchmark and bring an end to questions about salary history.
- Conduct pay equality audit: Companies can resolve the issue by simple conducting pay equality audit to find out the discrepancy in compensation and ensure that all the employees of same skill set get compensated equally. This is a good tool for retaining the talent of your company also. This issue can be resolved through job evaluation and pay range exercise for every position. Conducting audit through external agencies will be a better option.
- Eliminate biasness: Elimination of biasness can be great step for reducing the pay gap between genders. This can be of any kind like age, disability, motherhood, appearance etc. Biases can be conscious or unconscious and are difficult to deal. However, with gender ratio audit, pay audit, promotion policy audit, hiring process audits in place, companies can keep a check on the compensation gap and also work on the eliminating biases.
- Female friendly process: Most of the females don’t get a chance to return to office after a sabbatical or even if they get the chance they join at a lower pay as compared to their peers. Organizations can introduce employee friendly policies and provide facilities which help such women to continue with their jobs. These policies / facilities can be related to hybrid work model, day care facilities, flexible working hours, pick & drop etc.
- Safety Measures: Lots of females reject jobs due to odd working hours and are willing to accept low pay jobs because of inadequate safety measures. It is the responsibility of companies to provide safe and healthy work environment where females can join and work safely. Sexual harassment is also a major concern, on an average 1 woman in every 12 minutes faces this issue. Hence, effective implementation of POSH can be a good idea to deal with these kind of situations.
- Encourage female leadership: Investing in female leadership can be a good idea for narrowing gaps. Leadership inspires others and these female leaders can inspire thousands of female aspirants to come out from their skin and prove themselves. When we have a balanced board room, the result can be very different. We must strategize the hiring process in such a way where we can develop a gender balanced hiring approach and increase the opportunities for females. We can launch “welcome back” like campaigns to encourage their participation.
These are few ways through which we can try to bridge the pay gap between genders. The applicability may vary or can be used in different permutations and combinations depending on the industry and viability of the business. The pay gap is too wide and we really need to change our mindset and work hard to narrow the pay gap.