Academics at Cardiff Business School analysed UK-wide employee data to assess the impact of performance-related pay and concluded that performance-related pay is an important but overlooked factor behind the the gender pay gap.
Their results found that, compared to jobs which were not subject to performance-related pay, there is a lower concentration of female employees in performance-related pay jobs, particularly at the higher end of the wage spectrum, where bonuses are more common.
While performance-related pay was shown to affect the public sector consistently, it became increasingly important in the private sector in higher paid roles.
Gender differences between how performance-related pay is rewarded for men and for women have a further, but more modest role in widening the average gender pay gap.
Lead author Dr Ezgi Kaya said:
Our research shows a lower concentration of females in performance-related pay jobs. This could be down to personal preference on the types of roles that women go for, or restrictions in access to these sorts of jobs. But what is clear is that performance-related pay widens the overall gender pay gap considerably.
“This has practical implications for employers in terms of the design of their payment systems. Further research is needed to investigate whether this area needs further policy attention. If organisations want to address the gender pay gap, performance-related pay is an area that needs real consideration if they are serious about attracting female employees.”
In addition, last year, data from the World Economic Forum showed little progress, estimating it will take another 132 years to close the global gender gap. When it comes to shipping, while female representation across the industry remained stable at 42% in 2020 globally, a slight increase was noticed in the size of the maritime gender pay gap in the UK, latest figures by Spinnaker’s Maritime HR Association revealed.
