Working ladies, make noise

Over the weekend the Labor party announced that, if it were elected, Australian companies with 1000+ employees would have to reveal the differences in what they pay men and women.

While companies already report data on wage gaps to the Workplace Gender Equality Agency (WGEA), Labor plans to make this information public.

According to Fairfax Media the Opposition is currently planning legislation that would require companies to reveal wage differences between managerial and non-managerial staff, as well as ban secrecy clauses (basically, this means I can’t tell you how much I get paid).

Prime Minister of the day Scott Morrison believes that public disclosure may only serve to create tension in the workplace. And while he was quick to compare the Coalition’s “progress” against that of the opposition (surprise) the fact remains that the pay gap has barely moved for the last 30 years. In other words, neither party have made admirable progress.

Australia’s national gender pay gap is 14.6 per cent, which means that the average woman is paid $244.80 less than the average man per week. Over a year this equates to $26,527 (for full-time workers).

So yes, there is definitely #Moretodo

Would Labor’s initiatives actually help?

Deputy Opposition leader Tanya Plibersek says that the industries commonly using pay secrecy clauses also have some of the largest gender pay gaps.

This is hardly surprising, but the problem is much bigger than secrecy clauses.

Many Australian companies still largely favour individual flexible agreements, which means that wage and working conditions are negotiated directly between the employer and the employee.

While there are positives to having a negotiation-based system, this “one-size-fits-all” approach fails to account for the differences between men and women—especially when it comes to their negotiation skills.

In a world where working women are significantly under-valued, this system is inadequate.

A study at Harvard found that women who tried to negotiate their salary and work conditions were shut down quicker than men—they also paid a much higher social cost. Women were viewed differently because of their efforts to negotiate, being perceived as ‘not team players’.

Men on the other hand, were viewed as ‘bold leaders’ and rewarded as such.

It is the system, not secrecy, that is failing us

This system of negotiation favours men. And Harvard’s research suggests this cannot be resolved simply by encouraging women to speak up more (probably because they are sometimes penalised for it).

To address the issue—or at least part of it—we need to develop a deeper understanding of the situational circumstances that lead to the differences between men and women in deciding to initiate negotiations, and how they actually do so.

We also need to look at the behaviour of employers and try to understand what motivates and alters their perceptions of women and men during negotiations. But it would likely be harder to make a public-winning-policy initiative out of that.

For now, at least, maybe pay transparency would be beneficial. Companies might be held more accountable (though I wouldn’t bank on it).

But let’s not get ahead of ourselves—after all, this could just be another election promise.