Women work unpaid for 2 hours each day

25 August 2015 -

The latest research from CMI reveals the extent to which British women are being underpaid

Matt Scott

Women are working unpaid for almost two hours a day, according to the latest research from CMI into the gender pay gap.

The findings of an annual survey of 72,000 UK managers published by CMI and salary specialist XpertHR revealed that on average women working in equivalent full-time roles earn £8,524 less than men – a difference of 22%.

This means that women work unpaid for one hour 40 minutes a day – a total of 57* working days every year.

The 2015 National Management Salary Survey found that the average female salary of £30,612 was £8,524 less than the £39,136 paid to men. This is a marginal improvement on the 2014 pay gap, which stood at £9,069, or 23%.

Mark Crail of XpertHR said the situation was unacceptable, especially as it is 45 years since the introduction of the first equal pay legislation.

“An entire generation has now worked its way through from school leaver to retirement since the first equal pay legislation came into effect in 1970, yet the gender pay gap persists, and many employers still prefer not to know just how bad it is in their organisation rather than getting to grips with the data and doing something about it,” he said.

“HR and reward specialists in larger companies have a special responsibility to get this firmly onto the senior management agenda and to develop the plans needed to close the gap.”

The situation worsens as women grow older, with the pay gap increasing to 38% for women and men in their 60s (see left).

Furthermore, the pay gap also increased with seniority, with the difference in pay reaching £14,943 for senior or director-level staff.

The research also found that, not only are older women earning less, but there are also fewer of them in executive positions.

Women comprise 67% of the workforce in entry-level roles, and continue to outnumber men in junior management roles, but female representation drops to 43% for senior management. Even more worryingly, just 29% of director-level posts are held by women.

In March, the publication of Women on Boards: Davies Review Annual Report 2015 revealed that the number of women holding board-level positions in FTSE 100 companies reached 23.5% – just short of the 25% target set by government.

CMI chief executive Ann Francke said it was now time for businesses to address this problem and hire more women in executive level roles.

“Working for free two hours a day is unacceptable. While some progress is being made, it’s clear from our research that Lord Davies is right to target the executive pipeline,” she said. “Having more women in senior executive roles will pave the way for others and ensure they’re paid the same as their male colleagues at every stage of their careers.”

Large organisations are the worst offenders

The survey also found that the pay gap is widest for employees of organisations with between 250 and 999 staff, with women earning on average 27% less working for these employers – making them 5% worse off than even the national average.

This will be of particular concern for large organisations, with new legislation coming into force in 2016 that will require organisations with 250+ employees to report publicly on what they pay male and female staff.

Big four accounting firms Deloitte and PwC have already published this information, revealing a pay gap of 18% and 15% respectively.

Francke said: “Transparency is a powerful driver for closing the gender pay gap. The Government’s new reporting legislation is a welcome step forward and will be good news for business. Clearer employee data, improved recruitment and a reinvigorated focus on business culture will help unblock the talent pipeline and support more women to become senior managers and leaders.”

The Government has yet to announce the final details of the reporting requirements, with an ongoing consultation into the proposals closing on 6 September.

Minister for women, equalities and family justice Caroline Dinenage said: "We have more women in work than ever before, 25% of boards are now made of women and the gender pay gap is the lowest on record - and whilst I am proud of the progress made, we must go much further.

"This is why we will be requiring companies with 250 or more employees to publish their gender pay gap, to ensure the economy fully benefits from women's talents and fairly rewards them.

"I would encourage all companies to have their say on the consultation to help us eliminate the gender pay gap in a generation."

To help organisations prepare now for the coming changes, CMI has developed a set of eight best practice principles that set out a framework for gender pay reporting that will likely go beyond any legal requirements.

Visit www.managers.org.uk/mindthepaygap for further information or fill in the online consultation here before it closes on 6 September.

Join the conversation online by following @cmi_managers and @XpertHR, and using the hashtag #mindthepaygap

*Based on an average full-time working week of 37.4 hours; ONS Labour Market Statistics August 2015