Large pay gap at senior levels
A report released earlier this year by the by the Bankwest Curtin Economic Centre (BCEC) and the Workplace Gender Equality Agency (WGEA) identified, among other findings, that there is a large pay gap for women in more senior occupational positions. Women in key management positions working full-time earn on average more than $93,000 less annually than their male counterparts.
Organisational bias and women at work
According to a 2016 report by the BCEC and the WGEA, “large and persistent gender pay gaps among managers highlight the likely evidence of biased organisational behaviours, where men are given preferential recruitment and pay treatment over women at senior management levels.” Such organisational bias may impact on women’s careers, and the gender pay gap, in a number of ways.
For example, it has been found that women tend to achieve worse negotiated outcomes than men in relation to their own employment. According to the WGEA, there is no evidence that women are worse negotiators than men, or that they are inherently unwilling to negotiate. However, women are often reluctant to enter into negotiation in the workplace context, and those who do “tend to ask for less, and are more likely to accept an initial offer”. One reason offered by the WGEA for this reluctance is that negotiation often requires a person to exhibit “masculine” qualities, which, for a woman negotiating about her own employment, can have a negative impact on the way she is perceived in the workplace.
In addition, the Australian Human Rights Commission (AHRC) found that 49% of mothers surveyed in 2014 reported experiencing discrimination in the workplace in relation to pregnancy, parental leave and returning to work, impacting on their workforce participation. Also, “[27%] of the fathers and partners surveyed reported experiencing discrimination related to parental leave and return to work despite taking very short periods of leave”. According to the AHRC:
“Workplace cultures that are informed by the existence of pervasive harmful stereotypes about ‘the pregnant employee’, ‘the employee with family or caring responsibilities’, ‘the flexible worker’ and stereotypes about the ‘ideal worker’ contribute to this discrimination”.
Gender stereotypes within workplaces may also help explain the “choice” by some women to participate in low-paid industries, or not to pursue more senior roles, allowing them to balance work and caring responsibilities. For example, it may be assumed that working mothers will be less committed to work in favour of taking on a greater role in caring for their child(ren), affecting decisions about hiring, training and promotions. There may also be less support for men to take parental leave or adopt flexible or part-time working arrangements, in effect leaving mothers to take on greater carer responsibilities.
Finally, organisational bias may be evidenced by the so-called, “merit trap”, in which we are often drawn to people “who think, look and act like us”, even when we think that we are making objective decisions based on a person’s merit. Research has found that “senior men in Australian business were twice as likely to rank other men over women as effective problem solvers, despite believing that women were as capable as men in delivering outcomes”, and that women in some organisations are more likely to receive criticism for behaviour that might be considered a leadership quality in a man.
Addressing organisational bias
A foundational shift in our attitudes towards women and men in the workplace, and the removal of gender stereotypes from decisions about hiring, promotions and pay, may be needed to break down the gender pay gap. Positive steps, such as legislation against discrimination and workplace policies on gender equality, may not achieve their desired effect where there is entrenched organisational bias in favour of men.
A number of organisations in Australia have made inroads into bridging the gender pay gap and increasing the number of women in leadership. Positive steps taken by these organisations include:
- introducing a “reporting dashboard on pay equity to raise awareness and enable equitable decisions on remuneration”
- setting targets for women in partnership or leadership roles
- improving recruitment processes through “recruiter and search firm training, targets across key process steps, requirements for panel gender balance, use of external advisers, and changes to role advertisements”
- extending flexible work arrangements, requiring “senior managers to demonstrate how they model and facilitate flexibility and inclusion” as part of their performance review
- implementing policies to break down barriers for carers in the workplace, including staying in touch with people on parental leave, actively encouraging their return to work, and assisting with the cost of child care
- providing support for men taking parental leave or with carer responsibilities, and
- establishing open and comprehensive policies to assist employees experiencing family and domestic violence.
 The full-time gender pay gap in Australia is currently around 15.3% (WGEA, August 2017, “Australia’s gender pay gap statistics”, page 1).
 BCEC and WGEA, “Gender Equity Insights 2017, Inside Australia’s Gender Pay Gap”, page 8; BCEC and WGEA, “Gender Equity Insights 2016, Inside Australia’s Gender Pay Gap”, page 9; World Economic Forum, “Global Gender Gap Report 2016”, page 90 – 91.
 BCEC and WGEA, “Gender Equity Insights 2017, Inside Australia’s Gender Pay Gap”, page 7.
 BCEC and WGEA, “Gender Equity Insights 2016, Inside Australia’s Gender Pay Gap”, page 60.
 WGEA, 17 February 2016, “Negotiation: how it works (or doesn’t work) for women and why it matters”.
 AHRC, 2014, “Supporting working parents: Pregnancy and return to work national review – report”, page 8.
 AHRC, 2014, “Supporting working parents: Pregnancy and return to work national review – report”, page 9.
 Chief Executive Women (CEW) and Male Champions of Change (MCC), “In the eye of the beholder: Avoiding the merit trap”, page 4.
 CEW and MCC, “In the eye of the beholder: Avoiding the merit trap”, page 4.