The gender pay gap in Australia and how addressing it is good business

The gender pay gap in Australia is a significant impediment to running a good business. Maybe a few years ago, company leaders could dismiss the gap between men’s and women’s pay as an inevitable result of career choices. Now, equalising pay levels between the genders plays a significant part in creating a workplace that attracts and retains employees.

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Many employers face a recruitment crisis: getting skilled people to aid them in realising their goals is nearly impossible to sustain, yet often decision-makers lack insight as to why. Running a workplace where people proactively contribute, give their best and want to stay on board is not an unattainable dream. In fact, the information companies need to address their problems is in the data resources they likely already have. Sometimes, all it takes is a two-step process. Firstly, accepting the fact that an unequally-rewarded workforce isn’t a happy workforce, and secondly, beginning the journey to change the situation.

The message Tech Wire Asia heard from Kylie Baullo, the Managing Director, Australia and New Zealand, at HR and payroll services company ADP, on the Tech Means Business podcast was clear and simple on the necessary processes, and with that message, too, was a great deal of reassurance that organisations are not expected to make sudden, overnight corrective gestures. “It’s fine to realise that it’s a journey,” she said. “Beginning that journey is a great place.”

But of course, ensuring the right steps are clear isn’t a case of embarking in a random direction with no clear understanding of either the starting point or the destination. Before setting off, a business has to be aware of the current situation regarding pay, attitudes, staff concerns, employee turnover, parental policies and much more. Surfacing the relevant data is where ADP comes in.

Advantageously, finance, payroll and HR are the three areas of most companies that were fastest to digitise their processes, and it’s here that a great deal of neatly digitised information already exists. Retrieving it in a meaningful format from disparate data sources is challenging, but doing just that is one of the facilities the ADP platform offers. In the case of less digitally advanced companies, installing modern HR and payroll systems could be a firm first step.

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“First and foremost, having the ability to be able to automate and consolidate that data, all of your HR information, and particularly payroll being a source of truth matters. How you’re storing information is critical,” said Ms Baullo. “And then with that, it’s also making sure that you have the ability to consistently normalise and report on the current status.”

There is an increasing pressure on companies to report their compensation structures, Ms Baullo said. The Australian Federal government is starting to flex its muscles more and more:

She said: “The annual reporting [requirement] for WGEA is for more data. In the last three years, [companies have been able to] respond at a very high level, provide some summary data, submit it and move on. What we’re seeing now is not only the level of information that’s being requested in this reporting, but also the level of planning and visibility that is being asked for in terms of policy, and the ability to be able to report on the effectiveness of that policy.

“Organisations with over 100 employees are required to do this reporting now, and the government’s also shared its planned further enhancements to that reporting over the course of the next two years.”

The increasing amount of detailed reporting demanded by legislators gives every Australian organisation an opportunity to address the gender pay gap, a divide in compensation that’s widened in the last two or three years. Many are unaware that they are operating such an unequal workplace, according to Ms Baullo.

She said: “Two out of five employees that that responded to our survey said they don’t believe their company has thought about, or is doing anything right now, to address gender pay gaps.”

But addressing the gender pay gap isn’t an empty gesture, nor should it be seen as needlessly increasing costs. In a broader context, practices like equal pay enshrined in policy are hugely money-saving. “We’re all in a level of competition for the best talent,” said Ms Baullo. “We all want to have absolutely the most engaged workforce, we want to be able to retain, and continue to grow and develop the people that work in our organisations.

“People want to work at inclusive workplaces, they want to be in a workplace that has policies and procedures that are being clear about the obligations that they’re meeting. It is about securing the best talent, retaining the best talent, and it’s also about having a great Employer of Choice brand.

“People are interested in salaries, but more and more frequently, they’re interested in the entire package that comes along with working for an employer, they’re looking at that inclusive workplace; the way in which work is done, as well as the overarching [issue] of what they earn for the work that they do.”

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Employers of any size benefit from developing frameworks that will attract the right workers at any stage of their growth, plus a solid policy framework future-proofs any organisation against increasing levels of compliance and reporting detail.

Ms Baullo said: “If you’re only just starting to measure, you’re not looking to come up with a very complex policy framework out of the gate. It may just be as simple as looking at how you think about your return on maternity leave policies, or your parental leave. And it may be some of those aspects of total compensation that may help you take that first initial step. I think some of the recommendations that come out of WGEA reporting are also very, very helpful. And what I would also say is, if you measure it, it matters, and once you’ve measured it, you understand where your gap is, and you understand what opportunity you have.”

Technological solutions to human problems are sometimes misconstrued as somehow removing the human element, so it’s important to operate from a human-first standpoint. “We work to make sure that our solutions are always designed alongside people in the core of the business, to be really as simple as they possibly can be for people,” said Ms Baullo.

With over 40 years of experience in the Australian business world, ADP is helping companies be better places to work and as a result, be better businesses. Find out more about ADP and the technology that powers people.