A Practical Guide To Gender Pay and Employment Equality in 2024.
At the time of writing, three significant gender equality events coincided. International Women’s Day on the 8th March 2024, a new global report on the gender equality progress made by Employer and Business Membership Organisations (EBMOs), and TUC’s research, Women’s Pay Day on the 5th of March 2024.
International Women's Day (March 8, 2024) is a global day celebrating the social, economic, cultural, and political achievements of women. The day also marks a call to action for accelerating women's equality, especially in the work-place, and the theme for this year’s event #IWD2024, is to inspire inclusion. This is a theme we hold dear, which is why provide many guides and strategies to work towards more inclusive recruitment practices, including our guide to interview strategies that promote inclusion, especially in leadership in the membership sector.
The EBMO global report on driving gender equality highlights that many international membership-focused organisations recognise the business advantages of gender equality and are actively working to implement it internally and among their members. However, there remains ample room for further action, as with many other policy areas.
The TUC's analysis reveals that the gender pay gap currently stands at 14.3%, meaning women must work 52 days before they stop working ‘for free’.
We have distilled some of the key learning and highlights to see how far we have come and the path we still have to travel.
Key mechanisms identified to promote equality from the international EBMO study
The business case for gender parity
It’s not just that inequality is unfair, there are also many positive business cases for eradicating it.
In 2019, the International Labour Organization (ILO) conducted a global survey involving nearly 13,000 businesses across 70 countries.
The findings revealed that among companies tracking the quantitative impact of gender initiatives aimed at promoting women in management: approximately 74% reported a profit increase ranging from 5% to 20%.
Moreover, of the surveyed enterprises reporting enhanced business outcomes, over 60% noted higher levels of profitability and productivity.
Further analysis of the largest 3,000 US companies, represented by the Russell 3,000 Index, over a 17-year period demonstrated that organisaions led by female Chief Financial Officers (CFOs) exhibited greater profitability. Following the appointment of female CFOs, there was an observed 6% increase in profitability and 8% larger stock returns within the subsequent two years.
However, company performance extends beyond financial metrics. An examination conducted by the International Finance Corporation (IFC) across 33 countries revealed a correlation between higher representation of women on boards and in senior-level management positions and stronger company environmental, social, and governance standards.
Globally, women own just one in three start-ups. Nevertheless, evidence from the United States indicates that despite receiving less investment initially, start-ups founded or co-founded by women tend to perform better over time.
Data-driven EDI in the membership sector
In fact in our own 2024 Salary Guide, our research found that one of the top trends identified for 2024 is advancement in Diversity, Equity and Inclusion (DEI) in executive recruitment as a way of driving transformative change within organisations. We expect to see the implementation of data-driven strategies and the introduction of ground-breaking recruitment processes that eradicate biases introduced by human interaction, leveraged further throughout 2024.
A workforce in the membership sector rich in diversity not only boosts member engagement, employee loyalty, and creativity, but it also fosters an environment of inclusivity and teamwork. Teams that embrace diversity showcase improved performance and heightened motivation levels.
We are seeing that the membership sector is becoming increasingly committed to creating a more inclusive and equitable environment.
There’s still room for growth though, with just 18% of CEO positions across the membership sector, being held by women for example.
Pay, performance & transparency in 2024 - by the Chartered Institute of Personnel Development (CIPD)
In the UK, gender pay gaps remain a major challenge, and the latest findings from the CIPD’s Pay, performance and transparency 2024 report, show that an alarming number of employers are not conducting their gender pay gap reporting in line with government requirements.
- Almost a fifth (17%) of large employers (250+ employees) said they haven’t carried out gender pay gap reporting
- 18% said they didn’t even know whether their organisations had conducted reporting.
The organisations most likely to admit to not carrying out gender pay reporting in the 12 months to October 2023 are those employing between 250 and 499 people (29%), despite it being a legal requirement for all businesses with 250 or more employees in England, Scotland, and Wales.
As a result, the CIPD is calling on employers to help tackle discrimination and inequalities at work by reporting on their gender pay gap data and analysing that data to create a narrative and action plan.
They say that it’s important that employers understand the causes of their gender pay gap, including looking at how people are recruited, managed, developed, and rewarded, to ensure a fair approach.
With this insight, a narrative can be created to explain the numbers and an action plan can be developed to address inequalities.
Key Findings
- Pay transparency is limited: While organisations are far more likely to publish salary ranges compared with specific salary information, only 41% always share ranges in external job adverts, and only 18% always share specific salaries in internal job adverts.
- The only pay inequality analysis carried out by a significant proportion of our respondents is for gender pay gaps (44%). Lower proportions carried out equal pay audits (32%) and ethnicity pay gap analyses (28%).
- Only 54% of organisations check that their employees understand their pay, despite the finding that requests for information about pay have increased in the last year, perhaps because of the cost-of-living crisis.
Recommendations for hiring managers in the membership sector
- Publish pay information in job adverts: This can help widen your pool of candidates and help reduce pay and pension gaps. If you use salary scales, indicate where you would expect the successful candidate to start on this pay scale and where you would expect them to be after a few years.
- Be more transparent about pay internally: Given legislative trends in the US and the EU, we expect a similar direction of travel in the UK. Share pay scale information with existing employees, and how pay varies by protected characteristics such as ethnicity.
- Promote other elements of your reward package to employees: You could offer total reward statements that remind staff of other benefits, such as private medical insurance, pensions, annual leave, and company shares or consider flexible payment options, such as more frequent payment cycles or letting employees choose their pay date.
ONS data shows signs of improvement in the UK
The 2023 Office of National Statistics (ONS) report on the gender pay gap in the UK, shows a slow continuation of the trend of narrowing gender pay gaps. It also summarises that:
- The gender pay gap has been declining slowly over time; over the last decade it has fallen by approximately a quarter among full-time employees, and in April 2023 it stands at 7.7%.
- There remains a large difference in the gender pay gap between employees aged 40 years and over and those aged under 40 years.
- Compared with lower-paid employees, the gender pay gap among higher earners is much larger, however this difference has decreased in recent years.
- The gender pay gap has decreased across all major occupational groups between 2022 and 2023.
- The gender pay gap in skilled trades occupations remains the largest of the major occupational groups, however, it has also decreased by the largest amount over the past years.
- The gender pay gap among full-time employees is higher in every English region than in Wales, Scotland or Northern Ireland.
2024 pay and salaries in the membership sector
By delving into our research findings and drawing upon our extensive expertise in the membership sector, you can gain valuable insights into the typical salary benchmarks for various roles within membership organisations by accessing our comprehensive 2024 Salary Guide here and our 2024 Finance Salary Guide here, exclusively for the membership sector.