An equal pay policy can be a competitive advantage

Nearly seventy years after the Universal Declaration of Human Rights stated that ‘everyone has the right to equal pay for equal work’, there was still a huge difference between what men and women earn.

Between 2014 and 2017, the OECD found gender pay gaps of nearly 10% in France (meaning that women earned just over 90% of a man’s wage), 11.5% in Spain, 12% in Australia, 14% in The Netherlands, 16% in the UK and Germany,18% in Canada and the U.S., 24.5% in Japan and 35% in Korea.1

Despite widespread realisation that this pay issue is clearly wrong, the World Economic Forum estimates that at the current rate of change it may take more than 202 years before the gender wage gap is closed completely.2

Why paying people fairly gives companies a competitive advantage

Companies who don’t reward women fairly are restricting their hiring talent pool and demotivating a significant percentage of their workforce. Paying people fairly helps boost productivity by increasing collaboration and sending out a clear message that those people who contribute to the company will be rewarded, regardless of gender.

Of course, complying with local gender pay laws will also help companies avoid fines, expensive discrimination cases and reputational damage.

Three steps towards ending gender pay inequality

The first step is awareness of the problem and greater visibility into employee pay. Governments around the world have already taken action towards ensuring that men and women are paid equally. France, one of 13 countries where employers are now required by law to submit gender pay data,3 has made the most progress towards gender parity.

The second step for any company is to examine its pay gaps and take action to avoid such gaps in the future. This may not be simple. Education, experience, qualifications and work location all affect an employee’s salary and make comparisons difficult, especially when we throw local pay levels and regulations into the equation.

The third step is to communicate your compensation strategy. Let people know that you won’t tolerate inequality. Tell people that you pay employees fairly. This will have a positive effect on morale within your company and the positive publicity will make your company more likely to attract new talent and new business. 

How do you put these steps into action?

Today’s talent management solutions also provide complete visibility of your workforce. But to do this they need to unify payroll and HR to ensure that the relevant data is available.

Once you have a unified solution, all you need is an analytics and reporting capability and you can see whether you have a pay problem and where it needs to be addressed. You’ll have access to the very latest facts, figures and insights (including information on gender, promotions, age, ethnicity and disability) and be able to share them in real time.

As for the third step towards putting a fair pay policy in place — communication — many HR software solutions enable social interaction and dialogue, which will help to ensure that everyone in your company understands your policy and how it affects them.

Like an equal pay policy, the right talent management solution will benefit everyone in your organisation.  


  1. (Latest available figures stated and rounded up or down to nearest whole number, except for 0.5)
  3. DLA Piper – International Gender Pay Gap Report 2018