Ireland: Steps employers can take to #EmbraceEquity for women

#EmbraceEquity for women is certainly a topical subject in Ireland. Irish employers published their first set of gender pay gap reports in December 2022. A recent analysis of these reports carried out by PWC found that 87% of employers disclosed a pay gap in favour of men and that there was a mean gender pay gap of 12.6%, meaning that, on average, female employees earn 87cents for every euro earned by men. This is largely in line with the most recently available data on the EU average gender pay gap which shows a gap of 13%.

A political agreement has also been reached on the EU Pay Transparency Directive, which goes further than the existing gender pay gap reporting obligations.

In this article we look at how businesses can recognise the complexities and challenges faced by women in the workplace, what they can do to address these and their gender pay gap, and what legal developments are coming that may impact women in the workplace.

How can businesses recognise the complexities and challenges faced by women, and why should they?

Leaving pay equity to one side, women face a number of other challenges in the workplace including gender and unconscious bias, difficulties balancing work and family responsibilities and a lack of role models and representation at leadership level. Many women may also have to contend with monthly menstruation, menopause and sometimes sickness during pregnancy which can create further work related challenges for them.

In addressing these challenges and creating a more flexible and inclusive work environment for women, businesses can attract and retain talent. Studies have also shown that businesses with diverse teams and inclusive cultures perform better than those that lack diversity. Certainly, an inclusive workplace that allows for a range of ideas and thoughts and a variety of points of view can trigger discussions and deliver innovative results, as well as provide a wide scope of versatile skills and expertise. Productivity and employee engagement is also likely to increase in circumstances where businesses offer flexibility in working patterns and remote working opportunities to all employees but which may be of particular benefit to female employees.

Therefore, by recognising and openly addressing the complexities and challenges that women face, businesses can not only comply with their legal obligations, but also improve their overall competitiveness and performance.

How can businesses support the recruitment/retention of women leaders?

There are a number of ways businesses can do this, including:

• Creating an inclusive and welcoming culture

This can be achieved by having family friendly policies and benefits including fertility and reproductive support, early pregnancy loss and menopause policies and running diversity and inclusion training for all employees.

By way of example, Bank of Ireland recently announced that employees will be entitled to avail of early pregnancy loss leave and 10 days’ fertility leave. Employees will also receive 26 weeks’ surrogacy leave (the equivalent to the ordinary maternity leave period). Employees will also be entitled to seven weeks’ top-up pay during parent’s leave, which is a step some businesses are taking to encourage more male employees to take this leave in order to share the parenting responsibilities. We are seeing an increasing number of businesses offer these and similar benefits.

Awareness of the importance of recognising and providing support for women experiencing symptoms of menopause has become heightened in Ireland over the last few years, largely through media coverage, and is an issue that was subsequently incorporated into the Government’s Women's Health Action Plan 2022-2023. It is widely accepted that many of the symptoms linked to menopause can have a negative impact on an employee’s health which can impact on their productivity at work. This was highlighted by a 2021 UK study which found that 23% of women who had been unwell because of menopause had left their jobs. Employers are becoming more live to the fact that female employees impacted by menopause symptoms are more likely to remain if they feel supported within the workplace, with many organisations introducing menopause policies addressing what had perhaps previously been considered a “taboo” subject.

Spain has also just passed Europe’s first paid “menstrual leave” law, making it the first country in Europe to do so.

• Offering flexibility

Providing flexible or remote work arrangements, even ahead of legislation requiring this (see further below), can help women balance their work and family responsibilities.

Offering flexible or remote work arrangements can also assist employees who are suffering from symptoms of menstruation, menopause or pregnancy by allowing employees to work from the comfort of their home or to take more breaks during the day.

• Offering competitive remuneration packages

Offering pay and benefits in line with industry standards and ensuring men and women are paid the same for equal work is the first step in fostering diversity and inclusion in the workplace. It also helps ensure that businesses are not exposed to a litigation risk.

Female employees can bring an equal pay claim against their employer where they can show that they are doing work that is the same, similar or of equal value to a male employee who is being paid more than them. Female employees can also take a gender discrimination claim against their employer where they have been treated less favourably than a male employee in a comparable situation. Employers should also be mindful of any practices or procedures that appear non-discriminatory but adversely affect women as this could amount to indirect discrimination unless it can be objectively justified.

Aside from the legal considerations, offering competitive and comparable remuneration packages helps attract and retain women and is the right thing to do.

• Having role models

Encouraging men, as well as women, to take time out for their families shows other employees that a business is supportive of family life and commitments. This includes men taking paternity leave, parent’s leave and parental leave. Having policies in place is a good starting place but, for these to have any meaningful impact, employees should be actively encouraged to take the leave and senior employees should lead by example.

Having women in senior leadership positions and indeed, aiming for gender parity at board level, is also a great way to show that both men and women are valued in a business and that everyone can succeed on merit.

• Providing career progression

Providing opportunities for training, mentoring and development can help women progress their careers. Ensuring that women have access to these opportunities and are given equal consideration promotion to the most senior and best paid roles can help retain them.

What are the reasons for a gender pay gap and how can businesses reduce their gap?

There is no “one size fits all” approach to reducing a gender pay gap. The causes of any gaps will vary from business to business and by sector, and it is important for a business to be clear as to what those causes are. Unless a business really understands the drivers of its gaps, it’ll only waste time and effort on initiatives that won’t actually help it achieve reductions in gaps. Resources must be targeted in the right places to effect any change.

Often, companies’ gaps are caused by some combination of having too few women in senior roles and in technical or specialist roles. For example, many employers in the tech sector will have a preponderance of men in engineering or sales roles. PWC’s analysis found that a key factor in the reason for a gender pay gap is the relatively high number of males in more senior, (and so higher paid), roles.

Employers need to focus on recruitment, retention and promotion. They need to ensure they can attract women to their business, retain and support them in their career development, and ensure there are no barriers to them reaching the most senior and best paid roles.

There is a wealth of research into what specific measures are effective at attracting female talent and reducing gender pay gaps. These are helpfully reviewed and collated by the Behavioural Insights Team.

What legal developments or changes that may impact women in the workplace are in the pipeline?

Women’s rights in the workplace and pay equity is an area that is likely to see further developments in the coming months and years. We have set out below some changes that are coming in the near future which will impact women in the workplace.

• Flexible and remote work

Draft legislation, in the form of the Work Life Balance and Miscellaneous Provisions Bill 2022, is in place to allow eligible employees with children up to the age of 12 (or 16 if the child has a disability or long-term illness) and employees with caring responsibilities to request flexible working arrangements for a set period of time for caring purposes. Employers will need to carefully consider and deal with these requests. Employers should also prepare for employees requesting remote working arrangements. While remote working will not be feasible for all employees, employers will have to consider their own needs and the needs of their employees when considering any request. This draft legislation is expected to become law in the coming months.

Steps towards a potential four-day working week continue to gain momentum with some employers reporting the successful trialling of, or implementing, a four-day week for their organisations. This follows the Code of Practice on the Right to Disconnect that was introduced in April 2021, confirming employees’ rights not to habitually work outside their normal working hours, and to “switch off” from work. While this may not be relevant to a lot of categories of staff, it’s a trend employers should keep an eye on and one which could attract more female talent.

• Family rights

Other proposals under the Work Life Balance and Miscellaneous Provisions Bill will enable a better work-life balance for parents and carers. These include five days’ unpaid leave for medical care purposes, an extension of the period during which time can be taken out from work to breastfeed, the extension of maternity leave entitlements to transgender men and 5 days’ paid leave for victims of domestic violence.

In relation to miscarriage, while State paid maternity and paternity leave upon stillbirth or miscarriage is currently only available after the 24th week of pregnancy, there are proposals to make provision for State paid leave if miscarriage or stillbirth occurred before the 24th week. The proposals also provide for Sate paid leave for the purposes of availing of reproductive healthcare such as IVF.

• Diversity

Proposals are currently in place regarding the regulation of gender balance on the boards and governing councils of corporate bodies and related matters, which reflects developments at EU level. The Irish Corporate Governance (Gender Balance) Bill 2021, proposes to establish a 40% female representation quota on company boards. The Bill would also require companies to submit a statutory declaration to be made by the chairperson of the governing body i.e. the board, in its annual return or annual financial statements, that gender balance requirements have been complied with. If unable to do so, they will have to disclose the reasons why.

While there is still some way to go towards achieving full gender equality on boards, reports published towards the end of 2022 from Balance for Better Business and the Department of Public Expenditure and Reform demonstrate the trend to achieving this has accelerated in recent years, with EU targets for board gender diversity already being met and, in some cases, exceeded.

• Pay transparency

As mentioned above, a political agreement has been reached on the EU Pay Transparency Directive, which is intended to promote greater transparency and fairness in the workplace, and to help reduce the gender pay gap within the EU.

The current Irish legislation on gender pay gap reporting already complies with the basic pay reporting requirements of the Directive and goes beyond these requirements in some respects. One significant difference, which should go some way further towards identifying pay inequality, is that the Directive will require the publication of pay gaps by “categories of worker”. In addition, the Directive effectively imposes a positive obligation on employers to take action where pay differences cannot be justified by objective and gender-neutral means.

The Directive will also require the accuracy of pay gaps to be confirmed by an employer’s management, with employee representatives being given an opportunity to interrogate the methodology used. The current Irish legislation does not contain a requirement for anyone senior within the employer to vouch for the accuracy of the statistics. This is a significant change and will present an additional practical step for employers to overcome to meet their gender pay gap reporting obligations.

Comment

#EmbraceEquity for women is important for businesses for many reasons and an area that is likely to see significant developments in the future as further attempts are made to level the playing field between men and women in the workplace. Certainly, employers with progressive, inclusive and welcoming work environments should reap the reward of attracting and retaining talent, as well as increasing their business performance and competitiveness.

This post was also featured in the Irish Daily Mail: