A lot has been said about actions employers can take to close the gender pay gap, but one business owner claims to have cracked it.
His name is Mitesh Sheth and he is the chief executive officer of financial services firm Redington which employs around 150 people.
He claims that the City-based company, which specialises in investment advice, slashed its pay gap from 21.6 per cent to 0.2 per cent, compared to an industry average of 26.2 per cent, in just one year.
Flexible working: An increasingly popular arrangement is allowing employees to do some or all of their work from home or elsewhere other than the office
While not disclosing any facts or figures, he said that efforts to address the disparity in pay women receive in his workplace has bolstered productivity and his company’s performance.
So how did he do it? By following just three key steps. We explore each measure in full below.
Step one: expanding recruitment pool
Mitesh Sheth of Redington says his company slashed its pay gap from 21.6 per cent to 0.2 per cent in just a year
A fundamental driver behind the gender pay gap is motherhood according to a joint report by the Institute of Fiscal Studies and the Joseph Rowntree Foundation.
It found that mothers tend to spend more time in part-time employment when they have children and therefore don’t benefit from pay rises associated with experience.
By the time a first child reaches the age of 18, mothers earn 30 per cent less per hour than similarly educated fathers, according to the study.
To tackle this issue, Redington launched a return to work programme skewed to mothers, in partnership with executive search firm The Return Hub.
Four out of five of the women who enrolled in the scheme in its first year went on to accept a full-time position at the firm.
‘It wasn’t a case of positive discrimination,’ Sheth told This is Money.
‘We simply expanded our recruitment channels and found that many mothers had the talent and expertise we were looking for.’
Now in its second year, the scheme has been opened up to also include ex-military personnel as well as female professionals. Three out of four of those on the second intake have stayed with Redington.
The firm also widened its recruitment pool to target school leavers and graduates studying subjects not typically associated with a career in financial services.
Step two: using an online tool to consider pay rises
The company has also revamped its remuneration process to weed out ‘unconscious bias’ among managers when deciding bonuses, pay rises and promotions.
Sheth implemented the use of an online continuous performance management tool which, as it name suggests, tracks how individual employees are progressing with their targets.
WHAT IS UNCONSCIOUS BIAS?
According to the Advisory, Conciliation and Arbitration Service Unconscious bias occurs when people favour others who look like them and/or share their values.
For example a person may be drawn to someone with a similar educational background, from the same area, or who is the same colour, gender, sexuality or ethnicity as them.
The tool tracks progression throughout the year as opposed to looking at just traditional annual appraisals.
The idea here is to eradicate bias and pre-conceived views that can arise due to various natural tendencies or personal affinities by using facts and figures.
‘We all have a unconscious bias but that shouldn’t stop those deserving from getting a promotion or pay rise,’ Sheth said.
‘Using an online performance tool also helps those who don’t have it in them to ask for a pay rise.
‘If an employee has outperformed, it would be tracked by the online tool. It is difficult to argue against giving a pay raise when you are confronted by facts and figures that says otherwise.’
Step three: introducing flexible working
Deviating from the conventional working arrangement to accommodate for employees’ responsibilities outside of work will create a more energetic, committed and highly motivated workforce.
This is the view shared by advocates of flexible working.
There are different ways of working flexibly. Some employers adopt the ‘flexitime’ approach which allows employees to choose when to start and end work (within agreed limits) but work certain ‘core hours’ – 10am to 4pm every day for example.
A fundamental driver behind the gender pay gap is motherhood according to a joint report by the Institute of Fiscal Studies and the Joseph Rowntree Foundation
An increasingly popular arrangement is allowing employees to do some or all of their work from home or anywhere else other than the normal place of work.
This approach, according to Sheth, has not only been beneficial for mothers but also fathers working at the firm with childcare responsibilities.
Sheth said: ‘We moved away from having desktops to laptops to make it easier for people to work from home. In my line of work, I don’t think you have to be rooted to the office for maximum productivity. If you have the right mindset, you can be at your most productive wherever you are.’
He added: ‘While we are incredibly proud of the huge progress we’ve taken over the past year, we are continually striving for better. We are still on a journey to ensure full equality across all diversities, eliminating biases and prejudices that may influence that. We are not there yet but we’ll keep looking to improve until we are.’
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