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Greater transparency over earnings is just one way of tackling the multiple causes of the gender pay gap.
Finland is looking to pass legislation that allows workers to check what their colleagues are earning in a bid to close the gender wage gap. Prime Minister Sanna Marin’s coalition government believes the law will help workers who suspect they are being discriminated against. Women currently make 17.2% less than men in Finland, on average and the government is anxious to make progress. Like much legislation, the new bill has been criticised by both unions, who believe it doesn’t go far enough, and employers, who think it goes too far and could create conflict in the workplace. It is expected to be passed before elections in April 2023.
The move is just one example of growing interest in how greater pay transparency might close the gender pay gap.
The Fawcett Society has run a campaign, for instance, to give women who suspect they are being discriminated against the right to know if they are being paid less than a male colleague for doing the same job. It wants employers to be obliged to provide this information if it is requested.
The campaign comes at a time of a number of legal cases which centre on whether it is discriminatory if roles that are dominated by women and are equivalent to those done traditionally by men are paid less.
For Equal Pay Day this week, the Fawcett Society is also focusing on another aspect of the pay issue. Its new campaign is for employers to stop asking candidates about their previous salary during the recruitment process. A survey conducted by the organisation shows that 58% of women and 54% of men said that disclosing their past earnings meant they were offered a lower wage than they would have got otherwise.
The Fawcett Society argues that, as women have historically been paid less than men and can often start in sectors or roles that are lower paid than men, asking for previous salaries entrenches inequality and leads to a bigger pay gap. Its survey also shows that many people who are asked about their previous salary enhance it a little, knowing it will dictate what they are offered.
It is just one aspect of the recruitment process that seems outdated and which could contribute to the gender pay gap, although a large part of the problem is the lack of women in more senior roles or the imbalance of women in the lowest paid roles. There is, of course, no one course of action that will make a difference. The causes of the pay gap are many and therefore require a variety of approaches. Greater transparency is a vital way to shine a light on at least some of the factors involved. Until we have the data, we won’t know the extent of the problem.