How addressing the ‘motherhood penalty’ could solve the gender pay gap
Evidence links the gender pay and seniority gap to the discrepancies between parental leave for men and women. We need a shift in corporate and cultural norms
As companies around the world are urged to “break the bias” this International Women’s Day (IWD), they must also look at the barriers in place that make equality progress painfully slow.
There was a meagre 1% growth in the number of women in senior management roles between 2018 and 2020, as reported on 7 March by the Women in Finance (WIF) Charter. That comes on top of a decline in the number of women in executive positions in the UK overall, down to 13.5% in 2021 from 14.2% in 2020, as published in the FTSE 100 Women Leaders report last week. Meanwhile, the overall gender pay gap in the UK currently stands at 15.4% - an increase from 14.9% in 2020.
To break the bias - the theme of this year’s IWD – we must break the barriers that create it. Let’s face it, most biases against women are because our leadership and management skills – as well as career commitment – are called into question because of family responsibilities. Such questions rarely seem to come the way of working dads.
“When I had discussions with enterprise corporates before Covid, the attitude was, ‘we can’t hire mums because we need them full time and they have to be on site all the time.’ Flexible and remote working wasn’t an option,” according to one tech industry training consultant.
Indeed, 72% of women in the tech industry believe their careers are still suffering due to childcare and family responsibilities, according to a survey of 100 female tech leaders conducted in March by London Tech Week.
It’s a telling stat that quantifies how women are continually failing to climb over the broken middle management rung of the ladder across industries, according to many who spoke to Raconteur for this article. This stairway to nowhere has culminated in a lifetime gender pay gap of around 20%, which the Association of British Insurers has calculated as the actual cost of the “motherhood penalty”.
Mind the gender pay gap
By analysing an ‘unadjusted pay gap’, we can see the difference between men and women’s earnings in a business overall. It’s important to get this perspective – an ‘adjusted’ pay gap looks at like for like roles, but is illegal and being addressed by most reputable companies.
The unadjusted gap usually underlines how most corporate influence and wealth is still held by men. They sail over that broken rung, while it crumbles at women’s feet when our career paths converge with family.
Tech giant Salesforce, for example, reports a 30% average pay difference between men and women. This rises to 49% when you look at bonuses, a similar figure for Facebook, which reports an 11% median gender pay gap. But a number of companies, like software company Buffer and challenger bank Monzo, are able to report unadjusted pay gaps in single digits.
The common denominator is the number of women in senior roles - an issue for Salesforce, Facebook, and no doubt huge numbers of big companies. However, it’s something Buffer and Monzo are managing to increase, and crucially, is helping to shrink the pay gap.
Getting more women into senior roles and fixing that broken middle rung needs “a fundamental shift in approach” that simply isn’t happening fast enough, as Aviva CEO and WIF champion Amanda Blanc stated on the release of the Charter’s report. An action plan is needed to curb the estimated 30 years required to achieve gender parity at senior levels in this industry. That action plan includes the publication of C-suite bonuses, advertising all jobs as flexible, full pay equal parental leave, childcare facilities and benefits packages to support women at key life stages, such as menopause.
Policy and culture
Recognising where hard policy can and should be used to negate that motherhood penalty does two significant things. It acknowledges the problem and sets a sustainable, replicable precedent for rectifying it, in a way that no amount of diversity, equity and inclusion (DE&I) training, bias awareness or confidence building could ever hope to do.
These efforts need to be redirected towards the origin of the motherhood penalty: parental leave, the elephant in the room and the obvious first barrier that shapes women’s career paths for years to come.
Indeed, the WIF Charter’s survey of 100 of its signatories found that just two weeks of paternity leave was standard, compared with 20 weeks of maternity leave - the baseline where the gender pay gap begins, argues Nicki Pritchard, managing partner at executive search firm Anderson Quigley. She has just overhauled the company’s benefits package to include equal leave of three months full pay then three months half pay for all new parents.
“It’s pointless if we’re not sorting out the underlying issues. The gender pay gap comes down to such a logical thing. You sit down with your partner, and you say, who’s making the most, and it becomes a no brainer as to who should stay at home [on parental leave],” Pritchard reasons.
“Unless we’re dealing with this at that level, we’re never going to see men taking more parental leave.”
If only rolling out equal parental leave were as straightforward as Pritchard’s argument. However, it’s mired in both corporate and societal norms. Equal parental leave essentially doubles a company’s parental leave budget and there’s no guarantee men will take it.
There’s an “unspoken rule” that men shouldn’t take full paternity leave, according to 62% of working fathers surveyed by Volvo Car USA, with 67% believing it’s a “badge of honour” for men at their company to take the least amount of paternity leave possible. Taking paid time off where it’s available might seem like a no-brainer, but hundreds of years of the caregiver/breadwinner dichotomy are hard to shake, and that fear of losing career momentum – the same risk women face when taking career breaks to take care of children – is all too real and risky.
“Women in the past were just expected to take time off to raise children. Many times this was detrimental to their careers because when they returned, they were up against men who took no time off,” notes Ben Richmond, the US country manager for small business software firm Xero. “If we start to take a non-gender approach to parental leave, we can level the playing field for women and move past the stigma that can be associated with taking time off to care for children.”
Xero now offers a gender-neutral primary carer’s leave of 26 weeks full pay, which Richmond plans to take when his first child arrives in July. While a secondary leave policy of six weeks still seems to be the most popular option among new fathers in the company, Richmond hopes that setting such a public example will help turn the tables.
Simply offering equal parental leave doesn’t change years of expectations about men’s roles, acknowledges Hannah Johnson, global executive director at Blue State Digital, a marketing agency known for its campaigns around Barack Obama’s presidential election and for equal marriage rights. The company offers 12 and 18 weeks fully paid paternity and maternity leave respectively, with 100% take-up across new parents in the past two years. It’s a generous paternity policy for the advertising industry, in which parental leave policies vary hugely. It also reports a sector-wide pay gap of 17.8%, rising to 25% in some individual agencies.
“We more often than not default to women as the primary carer taking off 12 months versus it being a discussion and active decision that ideally it would be. But there are lots of other systems and beliefs that have to change around a policy for it to grow and become widely adopted. It’s now about understanding the barriers to uptake and working to break those down, too,” says Johnson.
That’s something that fellow marketing agency M&C Saatchi is working through as it reviews its parental leave policy to “encourage more equity across all parents”. The agency currently offers 20 weeks maternity leave at full pay, alongside a paternity package of two weeks at full pay and a four-day week for the next 18 weeks at full pay.
Managing partner Annabel Mackie says it’s a huge leap in the male psyche to go from the expectation of two weeks parental leave to six months, something the package is designed to bridge.
“Critically, there is a cultural change that needs to happen within business and within society. Businesses have to make that change happen with policies and more generous packages, but we need more senior secondary carers – more often than not, dads – to take longer, extended parental leave, and we need other men to see these secondary carers doing it, and it not negatively impacting their careers,” Mackie observes.
So long as double standards around caregiving and work prevail, so too will the gender pay gap. It will take bold businesses and individuals to step out from behind hashtags and invoke change right at the heart of the issue.