Closing the Gender Pay Gap: Insights from Industry Experts

It comes as businesses with 100 or more employees in Australia prepare to have their pay gap published online from early next year. In New Zealand, a similar push for mandatory public reporting is gaining momentum.

During the hour-long lunchtime webinar, Stephanie Love, Emily Johnston, and Michelle Ha discussed practical steps companies can take to achieve pay equity.

If in case you missed it, here’s the three things they’d do to get started.

1. Measure your pay gap to understand the current state

Conducting a pay audit is the first step to understanding if a gender pay gap exists in your organisation and the size of the gap. But it’s important to look beyond the headline numbers. Analysing your data by business units, seniority and location will shed light on your workforce composition and where the gaps may be coming from.

If possible, combine other demographic data such as ethnicity, age, sexual orientation and language to reveal further disparities. 

But what about if you struggle collecting this information from employees? That is certainly a challenge for many businesses and ultimately, it comes down to trust among your employees. Do they understand why you’re collecting the data, what it will be used for, and who it will be visible to?

Steph says: “I would just say, be really clear and open about what you’re collecting that data for. If you explain to people, “Hey, we’re measuring our pay gap because we want to understand if there is an issue and we are committed to addressing it, then people will probably be more likely to give that information freely.” 

As Steph suggested, be transparent with employees about why you’re measuring the pay gap and how you plan to address it.

ELMO Remuneration enables users to conduct a detailed gender pay gap audit and spot trends within their remuneration data. The software is gender agnostic, helping teams implement their remuneration policies and make remuneration decisions based on performance, rather than bias.

2. Educating your leaders to secure their buy-in

Beyond the data, don’t forget to educate your leaders on the risks and benefits of not only pay equity but broader diversity, equity, and inclusion goals.

Appointing executive sponsors for internal initiatives is one way to make sure accountability does not sit solely with the HR team. Emily Johnston, People Partner at ELMO Software, said the support of executive sponsors has been instrumental in getting ELMO’s Diversity, Equity, Inclusion and Belonging Committeess off the ground. 

“Having those passionate sponsors who go back to our board meetings or the executive meetings to share metrics or our initiatives is really valuable. They’ve seen what the committee is doing first-hand and been part of those conversations,” she said. 

Educate leadership on why pay equity is important, both for your people and your bottom-line, as well as aligning your DEI goals with your company values. Igniting their passion and buy-in will drive real change.

One of the most challenging aspects for HR professionals is securing buy-in from their executive leadership. Without it, enacting a change as large as pay equity can feel like pushing water uphill. 

Your leaders set the tone for the rest of the business and so it’s essential to have them in your corner.

“I faced this challenge a few years ago with an organisation I worked for,” Steph says. “What we ended up doing is creating a charter within the organisation which we got the entire executive team to sign. The charter said that we are committed to pay equity and equal pay.

“So ultimately, we brought it to their attention and then, once they’ve got it in black and white, they actually can’t ignore that data.”

3. Be proactive, rather than reactive

A big theme of the webinar was the need to be proactive. This goes for both understanding the numbers within your business and tackling the factors that are causing them.

“Change is happening. Either it’s happening to you, and you are being reactive from a compliance perspective, or it can be the catalyst for change that can supercharge your organisation culturally, but also commercially as well,” said Michelle Ha, DEI Consultant at TDC Global.

Michelle urged HR professionals to be more proactive during the recruitment process to increase applications from a wider, more diverse talent pool. One of the tips she shared was making policies publicly available for candidates who may be thinking of applying for a position. Those could include parental or carer’s leave policies, overseas working policies, gender or diversity policies.

“Organisations who are seen as champions of gender equity tend to have a better reputation in the job market,” Michelle said. “And employees almost always do their research before they apply. They’re looking at what benefits you have in place, they’re probably looking at your Glassdoor reviews, and maybe even connecting to people who have exposure to the company.”

Being proactive about sharing those policies and making them available is a great way to encourage a more diverse talent pool of applicants and stand out in a crowded market.

Another way to be proactive is to consider how you can connect pay equity to your company purpose and values. This helps to build a strong case for action and embeds it into your organisational culture. 

Baking it into the fabric of your organisation’s culture helps to reframe pay equity as everyone’s problem to solve – rather than HR’s alone.

Steph said establishing a ‘why’ is a great north star for businesses to follow.

“Ask yourself, what are you trying to achieve? If it’s just for compliance, then you’re just going to achieve compliance but if you want to do it for other reasons, becuase it’s good for business, it’s good for the economy, it’s good for your employees and their families.

“But just be really crystal clear on what it is that you’re wanting to achieve and then for every single decision you make from that point onwards, that is your litmus test. 

“You can assess whether it aligns with what we’re trying to achieve and if it’s not, maybe it’s something we don’t do. There are a lot of ways you can go about it pay equity and it can feel overwhelming at times.”

In summary, achieving pay equity requires first measuring and understanding your pay gap, then gaining leadership buy-in, and finally embedding it into your organizational values and purpose. 

Pay equity benefits both employees and the overall business, so take the first step and run the numbers.

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