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Equal Pay Day: Who really cares whether men and women are paid the same, anyway?

I’m supposed to be at an Equal Pay Day event right now… but I was so cranky that women still earn 17% less than men in equivalent roles that I decided to stay home.  Instead of hearing more women speak about how unjust the gap is, and decree another call to action for the female audience to demand change, I took my frustrations out on the garden.  After much hacking and pruning of the hedge I’ve let off enough steam to write this post, which I need to do because I’m speaking next week at a BPW luncheon in Geelong on this very topic… even though I’m quite convinced that no one really cares about pay equity anyway.

Okay so maybe “no one” is an exaggeration… but clearly not enough people in positions of influence care about this issue to make it go away.  So who are the people who might be able to influence the change? We could start with men: they hold 97% of CEO roles, 92% of key executive appointments and 87% of board positions.  It flows logically that it’s these men who don’t care enough about pay equity to fix it.  Why is this so?  Why do these decision makers attribute more value to men than women? And how can we change it?

I dare you to start the change process by forwarding this post to your boss and colleagues, asking what they think about my suggestions….

So I think the first place we need to start is by understanding the real and tangible motivations for enduring pay inequity, and then what we can do to improve our lot:

  1. It’s a simple fact that it’s in the financial interests of leaders to pay women less.  Leaders get paid bonuses for keeping costs down and driving profits up: if they can pay women less and get away with it, why wouldn’t they? It has a positive impact on the bottom line, which is what analysts want and what their bonus is based on.  If you’re a woman in a company that exhibits the gender pay gap, go buy shares in it: you’ll make back some of your money in the dividends you’ll receive!
  2. Most leaders continue to define productivity (and ambition, for that matter) in terms of hours worked, not outcomes produced.  It’s just a whole lot easier for them to do a quick scan of the floor as they leave the office at night and identify the ones staying back, and assume these workers produce a greater return on investment than it is to set and measure output targets.  So if you’re not visible at this time of the day, don’t be surprised if you miss out on that promotion.  If you’re a woman working in this kind of environment, revert to trickery to increase your after hours visibility: write emails during the day to your Drafts folder, then send them at night from your Blackberry while you’re bathing the kids or cooking your dinner or out with friends.  Or use www.sendible.com to forward schedule them. No one will ever know any different!
  3. Following on from this, of course a leader will place the greatest value on those employees they perceive as being most productive.  So in the case of women who take career breaks to raise their children, it’s only natural that their perceived career productivity will be lower.  A leader will rationalise by calculating the net present value of future salary cashflows, which is obviously lower for women who take time out than if they work through their careers uninterrupted. This offramping coefficient will be levied on anyone taking a non-linear career path.  The obvious solution for many women here is to start your own business; you can then decide how much money you’ll make, what you’re worth and how much and when you want to work.  Or you can find an employer who’s prepared to keep you on a career trajectory where you can make up for lost time, even if you do take time out. Angus Houston was successful in implementing this model in The Australian Defence Force but I’m not aware of organisations in the private sector doing the same.
  4. There is an enduring social assumption in Australia (and most of the developed world) that women with partners don’t need to work, and therefore they aren’t as serious or ambitious as the men on their teams.  Conversely I’ve had stories reported to me of Partnerships and payrises in law firms being skewed towards men who have “a wife and kids to look after”; ahead of single women who have “not a care in the world”, and married women who are “obviously” cared for already.  Tip for women: set clearly defined career goals and communicate them with your boss, and more importantly a sponsor in your workplace who can help make sure you make it.
  5. Most leaders assume that if someone’s not happy with what they’re being paid, or with their package, they’ll say so.  After all, most men do.  I frequently recall in my last executive role that of the 200-odd people reporting to me, it was the men that fronted up week after week – dozens of them in total – for a “coffee chat” which is code for “I want to hit you up for a payrise”.  I held that role for about 18 months and in that time only one woman did the same.  So were the women happy then?  Not always, but they’d sooner resign and get a higher paying job somewhere else than come cap in hand.  So should women simply learn to ask for more?  Maybe.  Should all salary data be made public? Or should leaders just get better at understanding their talent, rewarding them with promotions and remunerating them at market rates?  It would be a whole lot cheaper to make a few pay rises here and there than let your exceptional talent walk out the door and into the arms of a competitor. 
  6. It’s a convenient truth for the current suite of leaders that those jobs that men more naturally gravitate towards (like finance, product and sales roles) are paid more on average than roles that women are often attracted to (like marketing, human resources and customer service).  The current leadership would have you believe that their “core” line roles are more complex and somehow worth more than those roles related to “soft skills” and people (but what is a business, after all, without its own employees and customers?)  So should women take the advice so often put forward, and switch to a line role? Or should they stay with their passion in the “support roles” that pay less?  An alternative might be to invite your boss and male peers to job swap with you for a few weeks, so they can see how hard it is to produce the soft results, while you work on the P&L for a while.  It just might challenge their thinking when they see how hard it is to hone their own “soft skills”.

These are just my thoughts for the day on this issue of pay equity… perhaps you agree?  Or not?

As an alternate perspective, it’s worth pointing out that in my day to day life down on the farm, the exact opposite is true when it comes to gender inequality: on the farm the females are valued more highly than their male counterparts.  Put simply, a cow that will produce calves is worth more than a bull that will… well…  just eat grass.  (And yes, I know what the men will say and we do on occasion pay a premium for a quality stud bull – granted – but on the whole most bull calves are destined for the BBQ. No bull.)


Finally, are you still not sure about the gender pay gap? Here are the facts, courtesy of the official Equal Pay Day website:

  • A 17% gender pay gap costs the Australian economy around $93 Billion
  • Some women in CEO and finance positions earn less than half of their male equivalents
  • The average superannuation payout to a woman is projected to be $150,000, that’s half of the average payout to a man in 2010-11
  • The 17.2% gender pay gap is a national average that opens up to over 30% in some industry sectors
  • Equal pay for women raises family income which means more money to spend on food, housing and child care
  • Single mothers and working families lose thousands of dollars annually to the wage gap
  • A NATSEM report released in March 2010 shows that simply being a woman accounts for 60% of the difference between men’s and women’s earnings
  • If things don’t change, the average 25 year old male will earn $2.4M over the next forty years; for the average 25 year old female, that figure is just $1.5M

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