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Ireland's gender pay gap is better than the EU average - what else can be done to fix it?

“I think there’s [still] a lot of confusion. A lot of people make reference to equal pay, and that’s been enshrined in legislation since the mid-70s.”

FASHION DESIGNER AND entrepreneur Sonya Lennon founded Dress for Success in 2011, with the goal of supporting women in the workforce.

The charity aimed to help women achieve economic independence and sustainable employment by giving them the clothing and coaching to succeed in job interviews.

In the years following its foundation, however, Lennon and the charity’s workers and volunteers realised that there was only so much they could do to help individual women.

“We realised… that we could help the individual woman to succeed by giving her the tools available to us, but that in itself wasn’t the answer to the problem,” Lennon told The Journal.

“Because as much as we could help the individual woman, there were systemic issues that were impeding her progressing to her full potential in the workplace.”

Dress for Success – which recently changed its name to Work Equal – began to look into the cultural and social barriers preventing women from succeeding in the workplace. In 2018, it brought together a large number of stakeholders – including business leaders, unions, charities and politicians – for a conference.

Emerging out of this conference, a number of key areas were identified that could impact women’s equal status in the workforce and bring about positive change. These include redesigning childcare in the country, addressing societal norms which place a higher value on men’s work, and bringing in new laws to address the gender pay gap in Ireland.

The gender pay gap

The gender pay gap is the difference between the average hourly wages of men and women across the entire workforce, regardless of seniority. It is seen as a marker of the participation of women in senior roles (which are higher paid) in an individual company, sector, or in the country as a whole.

A survey carried out by Work Equal last year found that three quarters of people believed that closing the gap is important and should be a priority for government and employers.

However, there remains some mixed messages over what measures should be taken to achieve this, and what the gap actually is.

“I think there’s a lot of confusion, and that’s borne out in the research. A lot of people make reference to equal pay, and that’s been enshrined in legislation since the mid-70s,” said Lennon.

“That’s not to say that equal pay is not still an issue in some businesses and sectors, but this is really about opening up the pyramid of your organisation or sector and seeing where the predominance of men and women sit at all quartiles, and where is the earning power?”

In Ireland, Eurostat data show that the gender pay gap has fluctuated over the past decade. It rose from 12.7% in 2011 to a high of 14.4% in 2017, before dropping to 11.3% in 2019, the final year that figures are available.

The situation across the EU

Ireland’s gender pay gap is lower than the EU average of 14.1%. Luxembourg has the least difference in pay between men and women at 1.3%, while Estonia has the widest gap at 21.7%.

At the end of last year, MEPs voted overwhelmingly to call EU member states to take practical measures to ensure that women have equal access to the labour market and employment, and that they have equal pay and equal labour rights.

As well as this, earlier last year the European Commission proposed new measures to increase pay transparency in companies. The measures include requiring large companies to report on the gender pay gap in their organisations.

Following this, the European Council agreed a common position on the measures, and they are now due to be debated in the European Parliament.

Closing the gap

The current government has said it is committed to ensuring men and women are equally represented in the workforce. 

The 2020 Programme for Government contains a commitment to introduce new transparency laws similar to those proposed by the European Commission. The laws will require large companies to publish information on the gender pay gap in their organisations.

This law – known as the Gender Pay Gap Information Act – was passing through the Oireachtas during the term of the last government, but lapsed when an election was announced in 2020. It was restored by the current government and signed into law in July of last year.

The specific guidelines around how the law will operate have yet to be published, but it is expected to come into force later this year. Once this happens, companies with more than 250 employees will be required to publicly publish information on the gap between the earnings of men and women in their organisations.

In two years, this will apply to companies with over 150 employees, and in three years it will apply to companies with over 50 employees.

Consultancy firms have warned employers to begin ahead of time addressing disparities in pay between men and women, as they risk reputational damage once the gap becomes public.

Speaking last year when the law passed through the Oireachtas, Equality Minister Roderic O’Gorman said that “pay transparency is one step closer”.

“Reporting of the gender pay gap by employers will provide accountability and transparency, helping to ensure that employers address the gender pay disparity between men and women,” he said.

Case study

One company that has managed to close the gender pay gap ahead of time is An Post, which announced last year that women in the company now earn slightly more than men on average.

The company launched a Gender Pay Gap Report in 2019, and from there worked to narrow the gap from 3.7% to 0% last year.

Speaking to The Journal, Chief People Officer with An Post, Eleanor Nash, explained how the company managed to fully close the gap:

“Firstly, we brought in software to remove gender bias from all our role profiles. So every time we advertised a role we ran it through the software just to remove any gender bias,” said Nash.

“And for all our management roles we set a target to have gender balanced shortlists for interviewing. So the best person for the job, but we had a gender balance at the shortlisting stage.”

An Post also promoted its flexible working initiatives and aimed to build confidence in women who may want to progress in the company.

“What we find a lot for women is confidence, and how do you build that confidence with them? We had master classes from our management board. People at senior level sharing their own experience of moving up the ladder.”

The company also started a female candidate acceleration programme and worked to support women in creating networks across the company.

An Post has over 10,000 full-time employees, with the majority being postal operatives working out of Delivery Service Units (DSUs) across the country. Currently, just 13% of postal operatives are women, and Nash says An Post will work to address this and increase female representation at all levels of the company.

A symptom, not a cause

Sonya Lennon of Work Equal welcomed the introduction of the Gender Pay Gap Information Act last year, but says that far more needs to be done to ensure equality for women in the workplace.

“We’re extremely mindful that the gender pay gap is a symptom, not a cause. So we really need to start tackling the causes of the pay gap,” she said.

“Obviously bringing awareness and highlighting inequities cross sectorally is going to be very valuable and help us to move towards positive change, but looking at the other aspects around caring duties and childcare, around societal norms, they’re real issues that still need to be addressed.”

Work Equal is now focusing its lobbying efforts on reimagining childcare in Ireland

“Until men and women share caring duties, that idea of an equitable society is always going to be kind of elusive,” said Lennon.

“There are fundamental societal issues that are really glacial in terms of creating change, but we need to look at what an action plan to address these could be.”

This work is co-funded by Journal Media and a grant programme from the European Parliament. Any opinions or conclusions expressed in this work is the author’s own. The European Parliament has no involvement in nor responsibility for the editorial content published by the project. For more information, see here.

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