Influence of Pay Systems, Working Organisation and Working Time
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“Equality is vital, not only for individuals but for the economy and society as a whole.” These were the words said by the Equality Minister Harriet Harman in 2009 in response to the report brought out by the Equality and Human Rights Commission addressing the shocking disparity in gender pay gap in the financial sector in UK. (BBC, 2009)
With almost 40 years gone past with women first entering the financial sector, its still common to read the headlines where senior female financiers file complaint against their employers discriminating them on grounds of pay. The issues of glass ceiling and sexism still exist. The Scottish Centre for Employment Research (SCER) was appointed by the Equality and Human Rights Commission in 2009 to inspect the reasons and occurrence of the gender pay discrimination across the UKs financial services sector. The report reveals that women in financial sector receive 80 percent less in pay than their male colleagues, based on data collected through a questionnaire which was sent to 50 companies who collectively employ 22.6 per cent of the workers in the finance sector. (EHRC Report, 2009). According to the report, men are more likely to get promoted from a supervisory role to a managerial one than women. One of the main factors causing this difference was the occupational segregation wherein women are disproportionately over-represented in lower job grades and are concentrated in retail banking, insurance and pension funds as compared to men who take up jobs in fund management and trading which tends to be more lucrative. (eFinancialCareers, 2009). Another substantial factor was the pay systems in place. Bonuses which made up the annual gross earning did appear to be the area where much of the controversy was involved. With the executive bonuses being discretionary in nature it is hard to decide how these bonuses are calculated. Women are often seen as not negotiating on their annual CTC (Cost to the Company) pay package with their managers as compared to men who are regarded as more proactive and demanding when it comes to their pay. (National Management Salary Survey, CMI, 2009). According to the report a high proportion of women in this sector fall in the age group of 25-39, age at which women tend to have family and child care responsibilities. Moreover the challenging nature of job demanding long working hours deters women with childcare responsibilities to work full time thus leading to a