Pay rises: Should women's ability to negotiate matter?
Olivia Hill , October 14, 2016
An interesting read. We recently looked at our own workplace data to see how women's experience of the workplace differed from men's. We found that women didn't make such a fuss about the pay gap as ...
Read More Helen Wright
October 14, 2016 13:05
Should the ability of women to negotiate really be the most important factor in closing the gender pay gap?
A joint study from Cass Business School, the University of Warwick and the University of Wisconsin has suggested that women ask for wage rises as often as men, but men are 25% more likely to get them. My organisation AAT recently carried out similar research into the UK finance sector, which showed that men are more likely to receive pay rises than women. Our study differed from the Cass Business School study as our results suggested that men in finance are more bullish and more likely to ask for a pay rise.
In the wake of these pieces of research, a question might be asked: should it matter whether women are as likely to ask for a pay rise as men? Should employers instead move away from reward systems where those who speak loudest are more likely to get a raise?
According to figures from the Fawcett Society, the gender gap currently shows that on average, men are earning 13.9% more than women. The theory that women are less likely to ask for pay rises is one of the reasons that has been suggested for the persistent pay gap. According to Sara Laschever, co-author of Women Don't Ask, women asking for pay rises can be perceived as too aggressive and are sometimes punished for this approach by both male and female colleagues – whereas men asking come across as assertive and in control.
If the gender pay gap is to be closed, should the ability of a person to negotiate their salary continue to be the most important factor? Perhaps the onus should be more on managers and employers to ensure fairness by not relying completely on negotiations when deciding on pay rises.
Having rises decided solely on an individual’s ability to negotiate can lead to two employees who do the same job at the same level having different salaries, simply because one of them had better negotiation skills than the other. This could be a contributing factor to the gender pay gap. Basing pay rises solely on salary negotiations may also reward employees who are skilled at negotiating but may not be the strongest performers in other areas.
Options managers could explore instead of salary negotiations include creating a goal based reward system. Here, clear goals for the year are set with individuals to outline what they need to work towards to achieve a pay rise. This allows all employees to know how they need to perform, and means that everyone has an equal chance of achieving a pay increase. As well as personal performance, rewards can also be set out based on company performance, with employees all rewarded by the same amount or percentage when specific company objectives are achieved.
Salary negotiating is not just an issue for women; men who are less vocal and outgoing may also find it difficult to ask for a pay rise – and many feel that they shouldn’t have to, with their performances speaking for themselves. Anyone who is unfamiliar with the negotiating process, or nervous when put into such a situation, could be immediately at a disadvantage if salary decisions are made in that way. Managers and HR personnel need to look at their salary review processes holistically to ensure that all personality types are given the same opportunities to improve their careers and keep advancing, regardless of gender.
Olivia Hill is chief HR officer at AAT