JOB GRADE CAMOUFLAGE: WHEN LOW GENDER PAY GAP DOES NOT MEAN EQUAL PAY

Jan Cadil; Martin Kopecky; Tomas Jurcik

doi:10.52950/ES.2022.11.2.003

Authors

Jan Cadil Unicorn University, Department of Economics and Management, Prague, Czech Republic, Czech Republic Author
Martin Kopecky BDAdvisory, Prague and University of Economics, Department of Management, Prague , Czech Republic Author
Tomas Jurcik BDAdvisory, Prague and University of Economics, Department of Management, Prague , Czech Republic Author

DOI:

https://doi.org/10.52950/ES.2022.11.2.003

Keywords:

Gender pay gap, Equal pay, Responsible leadership, Job grade decomposition

Abstract

“Equal pay for equal work” is one of the backbone principles of Responsible Leadership. It is also deeply incorporated in legislation, mostly in developed countries. In recent decades, the gender pay gap has been put forward as a general indicator of equality by policymakers and researchers alike. Yet, research outcomes are disturbingly unsettled in comparison to bold political proclamations that are often based on simplified statistics. In our article, we show that the gender pay gap shrinks substantially if firm-level job grades (based on the Hay methodology) are used. The methodology used is gender-neutral and focuses solely on the job size, not on the incumbent. Moreover, we show that the gender pay gap does not reflect the idea of “equal pay for equal work” well. In fact, we conclude that people are being paid unequally regardless of their gender. A low or non-existent gender pay gap might then just camouflage real inequalities, leading managers and stakeholders to the false feeling that the company follows responsible leadership principles as defined by Steve Kempster (2016).

Data:
Received: 2 Sep 2022
Revised: 26 Oct 2022
Accepted: 10 Nov 2022
Published: 24 Nov 2022