The gap between men and women’s basic pay may have narrowed to 9.6% over the past few years – but new research suggests there’s still a yawning chasm when it comes to incentives.
The study, by the Chartered Management Institute, found bonuses awarded to male managers are almost twice as high as those given to women: last year, men earned an average of £6,442, compared with women’s paltry £3,029. For directors, that rose to £63,700, while women received just £36,270.
According to the research, over their lifetimes men will earn an average of £141,000 more than women in bonuses. In some parts of the country, that’s equivalent to a decent Victorian terrace.
Why do men make more? The usual arguments are twofold: firstly, that because women disappear from the workplace for a couple of years when they have children, they miss out on payrises and/or the incentive payments they would otherwise have received. The other argument is that men take more risks when it comes to negotiating their pay packets, and therefore tend to end up with higher settlements.
Whatever the reason, Ann Francke, the CMI’s chief executive, reckons that by failing their female employees, businesses aren’t playing the long game. If women feel under-appreciated, businesses lose out on growth and employee engagement.
‘Women are the majority of the workforce at entry level but still lose out on top positions and top pay. The time has come to tackle this situation more systematically,’ she said.
Is she right? The news comes at a time when the other key issue relating to women in the workplace – representation on boards – is about to come up for debate again.
In 2011, Lord Davies conducted a review into women on boards, concluding that FTSE 100 companies should set a target to have 25% of their boards made up by women by 2015. If that doesn’t happen, said Davies, the government should reconsider whether or not to introduce quotas.
Considering female representation on boards is still only about 17% - and that Boardwatch UK recorded its first ever fall in the percentage of women on boards earlier this year – it is beginning to look like the government’s approach needs to be more ‘stick’ than ‘carrot’. Taking a hard line might not be popular – but UK plc’s old boys’ club is looking increasingly like it is refusing to budge.