How We Can Actually Solve the Gender Pay Gap
Another March, another International Women’s day; and a few weeks later, another Equal Pay Day. Another round of headlines, talks, data and understandable outrage at the persistent and pernicious effects of gender inequality. It's widespread, and it touches all aspects of women’s lives, from our pay and professional advancement opportunities, to violence in our homes and workplaces.
Of course being aware of this, and talking about it at the very least on this one day a year, is important. But an exclusive focus on the problems — without looking for concrete scalable solutions — directs our eyes, energy, and outrage in the wrong direction. It might even make the problems “normal,” expected, or seemingly insurmountable.
We know that gender inequality exists, and we know that progress is very slow and in some places not happening at all. But in places where it is happening, is it being talked about enough? What’s working in other countries that could be applied here in the U.S., and why haven’t we tried all of those things?
This is where government comes in. To many activists and everyday people, government is simply one of the bad guys: its outdated rules and processes another cog in an institutional system that serves to uphold the patriarchy. That line of thinking accepts the status quo rather than working to change it. In countries and cities all over the world, from Iceland to Boston, heroic policymakers are taking innovative actions that are bringing about real change.
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Just this week, a new court ruling in the U.S. means that companies with 100 employees or more will have to report their pay disparities broken down by gender, race, and ethnicity, Bloomberg reports — and this could start within weeks. If management is somehow unaware of inequality in a company’s pay structures, simply pulling together this report will make it clear. A logical response to information like that would be making some immediate changes to lift up those who are being underpaid. This is reason to feel hopeful.
This IWD, let’s focus on what’s working — the policies and the pioneering public servants behind their success. Let’s promote their replication, and scale them where and when appropriate. And let’s make use of the tools out there to push for change in our own workplaces and communities.
So where to begin? Here are five ways governments around the world are tackling one of the most intractable issues facing women today — the gender pay gap — and proving that, actually, things don’t have to be this way.
Norway’s “daddy quota” means 90 percent of fathers take parental leave.
Known for its progressive gender policies, Norway has extended its parental leave system to make leave mandatory for both parents in a scheme also known as the “daddy quota.”
The policy aims to help women return to the workforce after giving birth and to encourage fathers to share in caregiving and bonding during a child’s first year. Before the 1993 policy, few men took parental leave, putting women at a disadvantage in the workplace and contributing to their underrepresentation in leadership positions.
The quota has made a huge difference. In the first five years it was in place, the share of eligible fathers soared from just 2.4 percent in 1992 to over 70 percent in 1997. Women’s increased participation in the labor force has, in turn, had positive overall effects on the economy through increased tax revenue.
Boston is offering women free salary negotiation workshops.
Research shows that women are more reticent in negotiating salaries than men: one study of graduating MBA students found half the male students had negotiated their first job offers, compared to just an eighth of the women.
To respond to its own gender pay and salary negotiation gaps, most acute among women of color, the city of Boston has taken the step of training women to demand higher salaries. Some 1,000 women have already participated, and eventually over 85,000 people — half the city’s female labor force — will have access to training.
Local female residents are offered free access to a series of workshops, in which they can learn negotiation strategy and style. That includes role-playing, salary self-assessments, and information about pay gaps. In an early survey, nearly half the participants negotiated higher compensation or achieved a competitive starting salary for a new job.
German women can find out what men earn.
Germany’s gender pay gap of 21 percent is among the highest in Europe. So, the government is trying a new approach. Last year, it implemented unprecedented legislation that allows thousands of working women to find out what their male colleagues earn.
Women in large companies can ask to be informed of the median salary of six colleagues of the opposite sex who work in a comparable role. The idea is that they can then use the information to determine if they are being underpaid, and then negotiate for a raise.
The Wage Transparency act is not yet being used at scale — a March 2018 survey by consulting firm EY revealed that less than half of the 1,000 professionals questioned were aware of the new law. However, it has significant symbolic meaning, and as more people learn about the law, more will put it to use.
Australian companies are required to report their progress to the government.
Since 2012, private companies and NGOs in Australia with 100 employees or more have had to submit annual reports to the government’s Workplace Gender Equality Agency. Employers have to measure their own performance against six gender indicators, including workforce composition, equal pay, composition of boards, support for flexible work, and sex-based harassment and discrimination.
The government now has data covering nearly half of Australia’s workforce, meaning it can advise employers on developing best practice strategies and actions to achieve equal outcomes.
Similarly, the U.K. has forced large employers to publish gender pay gap data for anybody to see on a public online portal. Australia’s approach is less adversarial — the government is trying to help employers remain aware of their own pay gap, and other gender inequities, in order to solve them. And it seems to be working: over 70% of Australian employers are implementing strategies and policies to support gender equality.
Iceland passed the world’s first law forcing companies to pay equally or face fines.
Iceland is regularly ranked the world’s most gender-equal country. However, women still earn 14 to 18 percent less than men, meaning they effectively work for free for around 60 days a year. (In the U.S. in 2019, equal pay day is April 19, which means we work a full three months into this year before earning as much as our male counterparts did last year.)
In Iceland, at least, that could change very soon as it has become the first country in the world to force employers to prove they pay equally — or face fines.
All companies and public sector agencies with 25 employees or more will have to undergo audits and receive certification to show that they don’t discriminate by gender in setting salaries. Failing to comply by 2021 could mean fines of around $475 a day. The groundbreaking legislation has paved the way for others, and France is already following Iceland’s lead.
But what can you do?
All of these government instruments work best when women and men know about them and take advantage. If you can access a salary negotiation workshop, go to it — and then use your new skills to demand better pay. If you have the right to demand transparency about pay in your workplace, make use of it, and fight to ensure the results are fair.
And if, like many of us, you don’t have these rights yet, share and shout about the ideas — with your colleagues, bosses, friends, or local representatives. Spreading what’s working elsewhere can only widen the scope of what is possible at home.