Gender pay gap: Women working for free!

Women managers in the South West are effectively working for free an hour and a half every day, new gender pay gap data reveals. 

The findings of an annual survey of 72,000 UK managers, published by the Chartered Management Institute (CMI) and salary specialist XpertHR, reveal that women working in equivalent full-time roles in the region earn 20% less than men, meaning that they are unpaid for 1h 30m a day – a total of 52 working days every year. This is compared to a national gender pay gap of 22%.

Analysis of the data from the 2015 National Management Salary Survey highlights pay imbalances across the UK’s professional workforce. For men and women of all ages and in all professional roles in the South West the gender pay gap now stands at £8,108 with men earning an average of £40,456 and women earning £32,348.

Nationally, the pay gap rises to £14,943 for senior or director-level staff, with men earning an average of £138,699 compared to the average for women of £123,756. Women managers are also missing out across all levels when it comes to bonuses, with the average man’s bonus of £4,898 almost twice that of the average woman’s bonus of £2,531.

The survey data also reveals that the pay gap in the South West becomes wider as women grow older. Women aged 26-35 are paid 10% less than their male colleagues, rising to 24% for women aged 36-45. The gap increases to 35% for women aged 46-60, equivalent to working 684 hours for free compared to their male colleagues.

Not only are older women in the South West earning less, but there are also fewer of them in executive positions. Even though women comprise 73% of the workforce in entry-level roles, and continue to outnumber men in junior management roles, female representation drops to 17% at the level of senior management. Just 21% of director-level posts are held by women. In March, the publication of Women on Boards: Davies Review Annual Report 2015 revealed that the number of women holding board-level positions in FTSE 100 companies reached 23.5% - just short of the 25% target.

David Potter of CMI’s South West Regional Board commented: “Working for free an hour and a half each day is unacceptable. While some progress is being made, it’s clear from our research that Lord Davies is right to target the executive pipeline. Having more women in senior executive roles will pave the way for others and ensure they’re paid the same as their male colleagues at every stage of their careers.”

Mark Crail, content director of XpertHR, commented: “An entire generation has now worked its way through from school leaver to retirement since the first equal pay legislation came into effect in 1970, yet the gender pay gap persists, and many employers still prefer not to know just how bad it is in their organisation rather than getting to grips with the data and doing something about it. HR and reward specialists in larger companies have a special responsibility to get this firmly on to the senior management agenda and to develop the plans needed to close the gap.”

In other findings, the pay gap across the UK is widest for employees of organisations with between 250 and 999 staff, with women earning on average 27% less working for these employers – making them 5% worse off than even the national average.

This should be particularly alarming news for large organisations. New legislation coming into force in 2016 will require organisations with 250+ employees to report publicly on what they pay male and female staff. Over 7,850 organisations, which collectively employ more than 11.2 million staff (40% of the UK’s workforce), will be affected by the new legislation.

The Government has yet to announce the details of the reporting requirements but the consultation outlined proposals closes on 6 September. To help organisations prepare now for the coming changes, CMI has developed a set of eight best practice principles that set out a framework for gender pay reporting that will likely go beyond any legal requirements. These include recommendations on updating data collection on staff salaries and setting performance targets [see Notes to editors].

David Potter added: “Transparency is a powerful driver for closing the gender pay gap. The Government’s new reporting legislation is a welcome step forward and will be good news for business. Clearer employee data, improved recruitment and a reinvigorated focus on business culture will help unblock the talent pipeline and support more women to become senior managers and leaders.”

Visit www.managers.org.uk/mindthepaygap for the infographic and reporting recommendations.

Join the conversation online by following @cmi_managers and @XpertHR, and using the hashtag #mindthepaygap