How to co-design a system for fairer pay.
More than 50 years since the passing of the 1970 Equal Pay Act, labour performed by women continues to be undervalued in the UK (Giapponi and Mcevoy, 2005; Bornstein, 2018; Yearby, 2019). Even when controlling for factors such as experience and contract type, one study found an unexplained gender pay gap in the UK of 10.5% (Boll and Lagemann, 2014). A 2014 report by the European Commission found that it would take over 70 years at the current rate for equal pay to become a reality in Europe (Brown and Rickard, 2018).
The impacts of pay inequality are far-reaching. Families with women as the sole breadwinners are more likely to live in poverty. Women also face financial jeopardy in their retirement due to the cumulative loss in pay over their lifetimes. As more women struggle to meet the cost of living, this increases the number of citizens reliant on government welfare schemes. The gender pay gap is therefore not just an equity issue but a significant economic issue (Mitchell, Levine and Phillips, 1999; Giapponi and Mcevoy, 2005; Bornstein, 2018).
Women who are paid less than their male counterparts are also more likely to experience depression and anxiety. Perceptions of workplace discrimination are associated with poor mental health and could affect employee morale and worker productivity. Workplaces with inequitable pay schemes may not only struggle to recruit and retain female employees but could risk being faced with lawsuits and costly litigation (Giapponi and Mcevoy, 2005; O’Reilly et al., 2015; Yearby, 2019).
Why does the gender pay gap still exist?
Across occupations, work performed by women is often undervalued. In the US, car and equipment cleaners (who are predominantly male) earn 14% more than housecleaners (who are predominantly female) despite the occupations having similar requirements. Even within the same job role, female truck drivers, software developers, financial managers, administrative assistants and registered nurses all earned between 10% to 30% less than their male counterparts (Bornstein, 2018).
Research has shown that the greater the proportion of women in a particular job, the lower the wage for that job, even after controlling for productivity differences. This trend is consistent over time. For example, designers, biologists, ticket agents and recreation workers in the US all saw their wages drop in real terms between 1950 and 2000 as these professions became more female dominated (Giapponi and Mcevoy, 2005; Bornstein, 2018; Brown and Rickard, 2018).
The gender pay gap can be understood as an extension of 20th-century cultural values around presumed income needs. These values viewed men as breadwinners deserving of a family wage and women as secondary earners who did not require self-sufficiency. For decades it was culturally and legally accepted that men and women would receive different pay even if they were doing the same work (Figart, 2000; Rubery and Grimshaw, 2015). When separate pay scales were abolished and replaced with a single pay scale, female-dominated roles were often placed at lower wage levels, thus preserving the gender hierarchy (Koskinen Sandberg, 2017). Even half a century on, market rates for female-dominated roles still reflect this bias. Employers perpetuate the gap whenever they determine the pay of new hires based on their salary history. The current movement towards individualised pay according to manager discretion could also enable these biases to become more prominent. This is especially the case as men successfully negotiate higher salaries more often than women (Giapponi and Mcevoy, 2005; Plantenga and Remery, 2006).
Gender bias is designed into our pay structures
Since the 1940s, many employers have used ‘job evaluation systems’ to determine the pay of their employees. Job evaluation is a systematic way of determining the value of a job in relation to other positions in an organisation. It operates on the assumption that the more complex the requirements of a job, the greater the remuneration a job should receive. Employers claim that job evaluation is fair because it is meant to be conducted based solely on the requirements of the job and without regard for the personal attributes of the employee (Chen et al., 1999; Figart, 2000; Koskinen Sandberg, 2017; Veldman, 2017; Wagner, 2020).
In practice, discrimination and bias can be reproduced at several stages of the job evaluation process, as outlined below:
1) Designs reproduce the values of their creator
A job evaluation scheme may be biased depending on the factors that are measured and how they are weighted. (Figart, 2000; Wagner, 2020; Corominas et al., no date).
For example, there is widespread use of ‘established’ job evaluation schemes such as the Hay scheme, which was created in the 1950s and was designed to reproduce and legitimise the gender pay hierarchy of the time (Steinberg, 1992; Rubery and Grimshaw, 2015; Wagner, 2020). Feminist theorists have found that demands traditionally associated with women’s jobs remain invisible in older job evaluation schemes. Schemes such as Hay, which are still common in the UK today, also tend to place a greater emphasis on managerial skills which are predominantly performed by men (Weiner, 1991; Figart, 2000). A danger of using job evaluation schemes from an era where women played very different roles in the workplace is that this could transport outdated criteria into new labour market contexts (Wagner, 2020).
According to feminist institutional theory, job evaluation schemes often prioritise the content of male-dominated work and thereby exclude and devalue much of the content of jobs typically performed by women (Weiner, 1991; Figart, 2000; Wagner, 2020). For example, dirt may be more visible in male jobs than it is in female jobs. Mechanics and bin collectors are perceived to work in dirty environments, whereas nurses and cleaners are perceived to work in cleaner environments, as these jobs involve the removal of dirt. As a result, there is a risk that dirt in the female jobs may not be accounted for (Weiner, 1991).
Jobs that involve supervision or working with young children may also be given a lower rating as these skills are traditionally believed to be ‘inherent’ to women. This is despite the fact that characteristics traditionally viewed as innate to men — such as physical effort — are consistently valued in job evaluation (Weiner, 1991; Corominas et al., no date).
Male-dominated attributes that are often over-valued include financial responsibility, team responsibility and physical strength. Female-dominated attributes that are undervalued include organisational skills, relationship skills, communication skills, customer service skills and emotional effort (Bender and Pigeyre, 2016; Corominas et al., no date).
2) Evaluators are never neutral
Knowledge of existing pay and job hierarchies can influence how job evaluation schemes are developed and how jobs are viewed and valued (Koskinen Sandberg, 2017). Studies consistently show that jobs perceived as high paying are typically assigned higher job evaluation points than those perceived as low paying. The result is that existing pay inequalities are inadvertently perpetuated (Mount and Ellis, 1989; McShane, 1990).
Familiarity about what a specific job entails may also affect how evaluators perceive and score the job. If job evaluation committee members are predominantly male for instance, they may be less familiar with the content of female-dominated jobs and may undervalue them as a result. Other characteristics of evaluators which may affect their familiarity with certain types of jobs include their experience, education, ethnicity and class (Mount and Ellis, 1989; Scholl and Cooper, 1991). It is therefore important that evaluators are drawn from diverse backgrounds.
A cause for concern is that many job evaluation schemes are conducted behind closed doors without the participation of employees in assigning value to jobs. This could bias the factor weighting towards managerial positions and may limit opportunities to change unfair practices in the determination of wages (Briem, 2018).
3) Organisations use different schemes when it suits them
Many organisations have different wage determination methods for different occupational groupings (e.g. one evaluation system for clerical jobs, another for factory jobs). This is particularly problematic as occupational groupings are often segregated by gender, meaning that male and female staff have their pay determined using different evaluation criteria (Weiner, 1991; Koskinen Sandberg, 2017).
A review of the use of job evaluation by local councils in the UK found that a significant proportion were using different schemes for lower-grade and higher-grade staff. The concern is that if wages for majority-male senior posts are determined using a different evaluation scheme than for other positions, the split between the schemes could be gendered in nature. A lower-grade female member of staff could potentially receive higher pay if their job was evaluated using the higher-grade scheme (Wright, 2011; Koskinen Sandberg, 2017). The use of multiple schemes therefore is not consistent with equity goals.
4) Lax compliance
Wage bands in the private sector have become broader to allow more individualised pay. This has reduced the importance of job grade and increased the capacity for manager discretion and individual negotiation. This is problematic from a gender perspective as male workers not only negotiate higher pay but they are more mobile and so managers may offer higher pay to retain them (Rubery and Grimshaw, 2015).
Even though organisations may have formal pay procedures, these are not necessarily followed in practice. One study found that amongst organisations that claimed to use job evaluation, careful job analysis was rarely conducted and wages were instead set according to cultural perceptions of appropriate remuneration for the type of work and employee. This process is particularly prone to reproducing gender inequalities. Job evaluation points were assigned after the fact in order to legitimise the wage paid and to disguise any gender-based differences in pay (Koskinen Sandberg, 2017).
5) Vested interest in maintaining the status quo
Job evaluation schemes that aim to be gender-neutral claim to more fairly reflect the skills, responsibilities and complexities of occupations typically filled by women. However, such schemes may be difficult to implement in labour markets where these attributes are typically undervalued. The further a job evaluation scheme deviates from the current relative market values of jobs, the less workable it is perceived to be by managers (Wright, 2011).
Organisations experience problems when two jobs assessed as having equal value have markedly different market pay rates (Wright, 2011). To offer competitive salaries whilst maintaining internal equality, firms would need to increase the pay of all other staff performing work of similar value, which may significantly increase labour costs and reduce competitiveness relative to discriminatory employers. Such complexities could be a cause of the slow adoption of gender-neutral job evaluation (Figart, 2000; Wright, 2011; Koskinen Sandberg, 2017).
Consequently, many job evaluation schemes used in organisations today are cautious about changing the way jobs are valued, especially those in which women predominate. Instead they seek to describe and reproduce the status quo in order to build and legitimise a more ‘workable’ pay structure (Wright, 2011).
6) The outsourcing loophole
Job evaluation schemes are generally intended to be used at the firm level and are not designed to tackle wage differences between organisations (Briem, 2018; Wagner, 2018). One risk is that firms could outsource certain roles to a contractor in order to avoid pay equality and therefore keep wages low. There are several instances of local authorities outsourcing majority-female social care roles to the private sector to keep suppress costs (Rubery and Grimshaw, 2015).
How to design out gender bias
In order to design out the gender biases identified in our pay structures, I propose that a new method of job evaluation needs to be created, which I refer to as ‘Universal job evaluation’.
Universal job evaluation has two main features. The first feature is that it should be applied across all industries, in order to close the outsourcing loophole. The second feature is that should be designed by employees themselves from diverse backgrounds, to ensure it represents a broad range of experiences and interests.
To put universal job evaluation to the test, I conducted two workshops with 13 members of the public in London. Participants were selected to represent a diverse range of incomes, job types and genders and were given three activities to complete. First, they had to decide which factors should be important in determining wages. Second, they had to score a series of job profiles against the factors identified in the previous activity. And third, they had to assign each job profile a wage according to their total score. At every stage, participants were asked to make decisions by consensus to ensure their proposals had broad support. The rest of the article explores the learning from these workshops.
How might a universal job evaluation design be different?
Participants in the workshop discussed several factors that they felt should influence someone’s pay. The following factors stood out as representing a significant shift from the status quo:
1) Antisocial time demands
Currently, there is no consistent acknowledgement that some working patterns are more antisocial than others. Many employers do not pay overtime while others do not reward evening or weekend work. Participants believed there should be greater financial compensation where there is greater loss of sociable hours with friends or family.
2) Role-related stress
Stress is not routinely measured as a factor to determine wages. Participants believed that this should change in order to better account for the effects that role-related stress has on employees’ personal lives and health. Formal consideration of stress could also incentivise employers to reduce the stress of their workers in order to lower their wage bill. Though participants questioned whether stress was subjective, it was argued that certain jobs were known to produce higher stress levels and that these effects could therefore be factored in.
3) Risk to health and physical endurance
Participants believed pay levels should reflect both physical endurance required and the risk of developing long term physical and mental health complications. They believed this to be justified as demanding physical roles would reduce a person’s working years and shorten their retirement. Participants thought that roles that involve being on your feet all day and that involve frequent in-person interaction with random members of the public should be compensated more. This is significant for roles in the retail and hospitality sectors as these positions typically receive very low pay. For example, one participant expressed astonishment that the cleaner at his workplace receives a minimal salary, given that the role is labour-intensive. Another participant added to this, saying he believed physical jobs were undervalued compared to desk-based jobs.
4) Responsibility for people
Responsibility for projects and finances is already considered within existing pay structures. However, participants felt that remuneration should also increase where roles entail a greater level of responsibility for people. This would mean that roles such as educators, health professionals and public transport drivers would see an increase in pay. For example, one participant argued that teachers should be more highly paid, given that they are responsible for the education, health and wellbeing of 30 children. She added that teachers still have a duty of care after children leave the classroom, whereas many highly-paid line managers in corporate jobs can switch off after work.
5) Communication skills
Communication skills are not valued within existing pay structures and yet they are an essential requirement for many low-paid and female-dominated roles. The participants felt that communication skills should be more highly rewarded, especially where there is frequent communication with members of the public. This could result in retail, hospitality, health and education staff receiving an uplift in pay.
What impact would a universal job evaluation design have?
Participants believed certain female-dominated roles that involve caring, nurturing and responsibility for people (e.g. nurses, teachers and nursery teachers) are significantly undervalued by the current job market.
The chart below shows a series of job roles that participants were asked to consider. The higher the role appears on the list, the higher the wage increase proposed by participants compared to current market rates (as of 2022).
Given that many workers in the top-featured female-dominated roles are employed by public institutions in the education and health sector, serious questions are raised about the likelihood of gender pay inequities being tackled when there is political pressure to cut public spending. The result is that the UK state perpetuates the gender pay gap in order to achieve other political goals.
Regardless of whether you are a policymaker, an employer or a concerned citizen, the following key points should be taken away from this article:
- We should acknowledge the continued undervaluation of women’s work in the UK. Pay practices for female-dominated roles that involve skills such as caring, nurturing and responsibility for people should be reviewed.
- We should work together to develop a universal job evaluation scheme for all employees. This should be co-produced with employees from all backgrounds, job types and job levels.
If you are a manager wondering what part your company can play, see the following:
- Employers should publish the criteria by which wages are calculated. This should be meaningful, so that every employee can understand the logic and reflect on their position at appraisals
- To reward employees more fairly, employers should consider assessing factors such as antisocial time demands, responsibility for people, communication skills and physical endurance and risk to health in determining base pay.
- Employers should invite a panel of employees from all levels of seniority to audit the wage structure to ensure it is fair and equitable
- Employers should advertise wage brackets to new hires and explain the criteria that will be used in negotiation.
The following limitations should be considered when reading this article:
- Wages in the private sector are often made up of base pay and performance-related pay, both of which contribute to the gender pay gap. Due to time limitations, this article focuses solely on base pay.
- Gender is one of multiple personal characteristics that can affect base pay including class, ethnicity, nationality and disability. Though they all deserve research, this study focuses solely on gender due to a lack of UK-relevant literature on the other characteristics as well as time restrictions.
- The universal job evaluation workshops featured in this article were limited in scope by time and financial resources. The full process would involve a richer and more detailed analysis of the job roles being assessed. Further sessions to engage more people would also be run to ensure reliability of the results.
- This study is built on the assumption that universal job evaluation can be used as a tool to tackle the gender pay gap. However, it should be noted that as the gender pay gap has multiple causes, job evaluation can only be one part of the solution. A holistic strategy would include other interventions such as family-friendly work policies and reforms to the education system.
This article was adapted from a master’s thesis submitted to the UCL Institute for Global Prosperity. The original thesis was awarded the MSc Global Prosperity Dissertation Prize.
I would like to thank my sister, Amanda Waters, for her editorial wisdom, my workshop assistants Ismat and Daniel and all of the participants who took part in the workshops.
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The gender pay gap is designed into our culture; here’s how we can design it out was originally published in UX Collective on Medium, where people are continuing the conversation by highlighting and responding to this story.