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Women in IT meet prime minister David Cameron's gender pay gap news with scepticism

The prime minister’s announcement that firms with more than 250 employees will have to disclose salaries has been met with concerns over how and when results will be published

Women in IT have responded with scepticism to a government mandate forcing companies to state if they pay men more than women.

Prime minister David Cameron recently announced the plan – which will apply to companies with more than 250 employees – but critics have voiced concerns over how and when firms will publish the information.

The announcement by prime minister David Cameron came as it was revealed the Lord Davies target of 25% of women on FTSE 100 boards by the end of 2015 had been met. The Lord Davies target was set in 2011 after a review was conducted into gender balance in the boardroom.

During the last parliament, the coalition put forward plans to ensure large firms published the average pay of male and female employees. The Liberal Democrats originally pushed for mandatory reporting after only five companies – Tesco, Friends Life, PwC, AstraZeneca and Genesis – published their figures of their own accord.

The measures will be introduced over the next 12 months, with a consultation to agree on how the regulations will be designed and where and when the information will be published.

The Office for National Statistics revealed the pay gap stood at 9.4% in April 2014, compared with 10% in 2013.

Cameron said the measures aim to cast light on the discrepancies and create pressure for change, driving women’s wages up as he vowed to eradicate the gender pay gap “within a generation”.

“Paying men and women different amounts for doing the same job isn’t entirely solved, but it’s nearly solved. The difference between pay for men and women doing different jobs is much more difficult to tackle, but we can do it with help from business,” said Cameron.

Potential issues

However, Eileen Brown, chair of TechUK’s women in technology committee and CEO of Amastra, said it depends on whether the findings are published in figures or pay grades/levels: “Pay grades in several organisations are structured to make it look complex and confusing, so it would be easy to insinuate women are paid the same as men when they are not.”

Gillian Arnold, Chair of BCSWomen and founder of Tectre said: “A lot of big companies will find a way to get around it, but then they will know there’s a problem that needs fixing and they need to be given a date to fix it – it has been 45 years since equal pay legislation was brought in, but not much has been done, so they need a date set to sort it.”

Arnold said the problem with the pay gap can stem from a lack of confidence from women to demand higher salaries in the recruitment process. “Women don’t haggle upfront. If the job says £50-£60k, the woman will accept the lower rate, whereas the man will confidently argue for more. If she’s valuing herself less then she’ll accept less.

“There’s also the problem of unconscious bias from the hiring manager – it would help the hiring manager to be aware of this and to know what to ask. It prompts the question, does the hiring manager have a moral obligation to say that asking for a higher pay is an option?”

Legal to discuss salaries

For employees at companies with less than 250 employees, Arnold highlighted a section of The Equality Act 2010 – guidance for employers report, which states that employees can discuss salaries if it is in relation to protected characteristics. 

Under human rights laws, protected characteristics are age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion and belief, sex and sexual orientation.

The report states that employees can legally investigate salary comparison, despite having signed a contract of employment saying otherwise, if it is related to one of these protected characteristics.

The report states: “Pay secrecy: The Act makes it unlawful for you to prevent or restrict your employees from having a discussion to establish if differences in pay exist that are related to protected characteristics. It also makes terms of the contract of employment that require pay secrecy unenforceable because of these discussions. An employer can require their employees to keep pay rates confidential from some people outside the workplace, for example a competitor organisation.”

Speaking on BBC Radio 4’s Today programme, women and equalities minister Nicky Morgan said the pay gap for under-40s working full-time had “virtually been eliminated” and appealed to businesses to make a “real commitment” in setting their own targets.

Commenting on the government’s pay gap announcement she said: “This is not just the right thing to do, it makes good business sense – supporting women to fulfil their potential could increase the size of our economy by 35%. To achieve gender equality, we need to inspire young women and girls so they can compete with the best in the world for the top jobs – and see that their hard work will pay off.”

“Saying we can afford to wait for another generation to close it is, to put it mildly, unambitious,” said former Lib Dem equalities minister Jo Swinson.

“The UK economy is currently missing out on the talents of too many women. In government, my Lib Dem colleagues and I fought tooth and nail with the Conservatives to get them to agree to even minimal changes to help close the gender pay gap,” she said.

More women in the boardroom

Having announced the target of a quarter of women on FTSE 100 boards by the end of 2015 has been met, the government said it is now looking into how this figure can be improved.

The Guardian reported that Davies said continued efforts would enable “more and more talented women take their rightful seat at the top table”.

Gender diversity has increased across FTSE 250 companies’ board. There is no target for this, but human capital consulting group Norman Broadbent has estimated the figure would reach 25% by 2017.

According to Norman Broadbent, women make up 23.7% of the companies’ boards, with this figure set to hit 25% in October 2015.

However, Arnold said most of this figure is made up of non-executive board members, meaning many businesses have added a “token woman”, but “it is the executives who make all the business decisions”.

Network for women

Autumn 2015 will see the Women’s Executive Network (WXN) launch in the UK. Based in Canada and Ireland, the network aims to support the advancement of women into senior management and executive roles.

“Over recent years, progress has been made in women securing leadership positions in business, however there is still an extremely long way to go. In the UK, women now account for 23.5% of overall board directorships, which is better than in many other countries, but there is still much room for improvement,” said WXN founder Pamela Jeffery.

“We are hoping the launch of WXN in the UK will help raise the profile of issues such as gender diversity in all levels of leadership, board governance and compensation. However, we also believe in a bottom-up approach – equipping women to take charge of their careers, aspire to leadership and inspire other women to follow. 

“In short, we want to inspire smart women to lead. We have been overwhelmed by the level of support we have received for the launch of WXN in the UK from prospective members, advisory board members and corporate partners,” she said.

WXN will hold its inaugural Speaker Series on 28 September 2015 at the Institute of Directors in London, featuring WXN member Moya Greene, the CEO of the Royal Mail, as the keynote speaker. This will be the first of four series on the latest in global leadership trends and current issues facing female and male leaders.

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In 1996 female earnings in the IT industry for those aged under 25 were 95% those of men. At 35 it was 93%, at 45 it was 85%. For over 50s it was 72%. Has anything much changed in 20 years?
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That is an admirable goal. Their thoughts are in the right place. I hate secrecy regarding salaries - it only benefits the companies.

But as with most government mandates, I think that the problems arise with how the mandate will be implemented. It will be interesting to see how successful this move is in increasing transparency. If it works well, I would love to see the U.S. government do something similar.
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