WORKPLACE, HEALTH & SAFETY
GENDER EQUALITY
GENDER EQUALITY
WORKPLACE, HEALTH & SAFETY
Workplace Gender Equality In The Construction Industry
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MBA NSW | Issue One | January-March 2021
Issue One | January-March 2021 | MBA NSW
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WORKPLACE, HEALTH & SAFETY
GENDER EQUALITY
GENDER EQUALITY
WORKPLACE, HEALTH & SAFETY
On 26 November 2020, Ms Libby Lyons, CEO Workplace Gender Equality Agency released *Australia’s Gender Equality Scorecard showing employers action on gender equality had stalled. Libby recently spoke to Omesh Jethwani, Government Projects & Programs Manager.
What is WGEA, and what does the agency do?
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he Workplace Gender Equality Agency (the Agency, WGEA) was established in 2012 to improve and promote equality for both women and men in the workplace. Under the Workplace Gender Equality Act, the Agency collects data from all non-public sector organisations with over 100 employees on six gender equality indicators: • workforce composition (jobs women and men do); • gender composition of boards; • equal pay; • support for flexible work and caring; • the consultation employers have with employees on gender equality; and • sex-based harassment and discrimination. The Agency has been collecting and reporting data for seven years and our dataset comprises just over 4.3 million Australian employees, or more than 40% of the workforce. However, WGEA is not just a regulator. We are also an educator and influencer and we work in partnership with employers. The insights from our data are used to advise and educate business on gender equality strategies and actions that deliver positive results. By working together with the business community, we have gained their support. It is now accepted practice for Australian employers to annually submit their information and data. In previous years, we have had a compliance rate of about 99%. Last year, even with the devastating impact of COVID-19 on our economy, we maintained a 98% compliance rate.
Why is gender equality in the workplace important? Workplace gender equality is both the right thing to do and the smart thing to do. We know from a growing body of research over the last decade or so that gender equality and diversity is good for organisations and good for employees. When leadership groups are balanced and diverse, they are stronger, more productive and can improve the bottom line of the organisations they govern. The release of last year’s BCEC/WGEA 2020
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MBA NSW | Issue One | January-March 2021
Gender Equity Insights Report proved beyond all doubt that the business case for gender equality is clear and compelling. This report analysed our world-leading dataset to provide tangible proof of something we have always suspected: a more gender-balanced leadership in an organisation delivers better company performance, greater productivity and greater profitability. It revealed a strong and convincing causal relationship between increasing the number of women in senior leadership and subsequent improvements in company performance. Appointing a female CEO, increasing the share of female key management personnel and increasing female representation on its board all led to increases in the market value of Australian ASX-listed companies. A company is also more likely to outperform its sector on three or more key profitability and performance metrics by taking the same actions. The findings of this BCEC report prove that gender equality is a commercial imperative and provides organisations with a competitive edge over their business rivals. However, workplace gender equality is not just about the business case. While the business case is essential, gender equality is also an issue of basic human rights as it affects 50% of the world’s population. When women are structurally disadvantaged in the workforce, or excluded from employment opportunities through occupational and industrial segregation, we are ignoring half the talent, ideas and potential of the workforce. Workplace gender inequality also has a flowon effect throughout all of society. As long as women earn less than men, care work is undervalued and women are dramatically underrepresented on boards and at CEO level, women’s position in our society is not equal to men’s.
On 26 November 2020, WGEA released *Australia’s Gender Equality Scorecard. Care to share the results with our readers. First of all, it is important to mention that last year’s dataset paints a comprehensive picture of Australia’s private sector workforce just prior to the impact of the COVID-19 pandemic. This will provide us with a strong baseline for comparison with this year’s dataset, which will
capture the impact of COVID-19 on workplace gender equality. Overall, the 2019-20 data showed a concerning decline in employer action on gender equality prior to the impact of COVID-19. The worst result was the reversal in action on pay equity. There was a decrease of 6.1 percentage points (pp) in the percentage of employers that took action to close their gender pay gaps. Just 54.4% of employers who did a gender pay gap analysis took action to close the identified gaps. I am also troubled by the ongoing lack of women at CEO and Board level. Although there were slight increases in the number of female CEOs and board directors, we are still decades away from achieving gender balance at the top levels of leadership. Progress on this issue remains glacial. There were some positive developments. The gender pay gap continued to close, with the total remuneration gap dropping by 0.7pp to 20.1%. Access to flexible work and paid parental leave for employees has increased. For the first time since we started collecting data, over 50% of employers now offer paid primary carer’s leave to their employees. Women’s promotions and appointments to managerial roles continues to rise with women now comprising almost four in 10 managers in our dataset. I was also pleased to see another strong increase in employer action on family and domestic violence.
The 2019-2020 report showed employers action on gender equality had stalled. What are the factors that may have contributed to this outcome? I have been concerned for some time that Australian employers might have become complacent. The modest rate of change that we saw in the 2018-19 results suggested they were in the grip of what I call “gender equality fatigue”. I was very disappointed that almost nothing changed in the results of last year’s dataset. It seems to me that Australian employers are on autopilot when it comes to improving gender equality. The issue is clearly not receiving the necessary attention to drive further change. Many organisations appear to believe that
Libby Lyons CEO — Workplace Gender Equality Agency
having gender equality strategies and policies is all they need do. Policies and strategies are not very useful unless they are implemented across a workplace. Thoroughout 2020, Australian businesses faced challenges and upheaval of a kind that has not been seen for many generations. I also know and appreciate that employers are likely to encounter more disruptions in 2021. However, I am concerned that if we do not see increased employer action on gender equality, we will go backwards. Employers have to keep their foot firmly planted on the pedal to continue to drive better gender equality outcomes.
Results from the WGEA’s 201920 report show the construction industry now rated to have the second-highest pay gap. In your opinion, why do you think the maledominated industry struggles to close the gap? The main reason is that the industry remains so male-dominated and employers have made little effort to change this. Men dominate the upper echelons, thereby having more access to additional discretionary payments such as bonuses which contributes significantly to the
construction industry’s remuneration gender pay gap of 26.1%. The construction industry also has to step up the action on pay equity. Just 41.3% have conducted a pay gap analysis in the last 12 months. Of those, 14.4% created a pay equity strategy or action plan, 19.5% reported pay equity metrics to the executive and 16.9% reported pay equity metrics to the board. All of these results have barely kept pace with the national average. By contrast, the Mining industry, which is the most male-dominated industry in our dataset, has made a more concerned effort to improve workplace gender equality and close its gender pay gap. The total remuneration gender pay gap in the Mining industry is 13.6%. Although it is still too high, it is lower than the national gender pay gap of 20.1% and less than half of Construction industry’s pay gap. Mining is also doing well on other indicators. Over 58% have conducted a pay gap analysis in the last 12 months. Of these, 28.7% have created a pay equity strategy or action plan, 46.5% reported pay equity metrics to the executive and 33.7% reported pay equity metrics to the board. These results are all much higher than the national
average. The best way to close the pay gap in the contruction industry is for employers to follow the mining industry’s lead and take targeted action on pay equity.
What has been the impact of COVID-19 on women’s employment? Previous recessions (1982-83, 1989-93) and downturns (2007-09) have predominantly hit men’s jobs and male-dominated industries harder. By contrast, the COVID-19 recession has had an equally detrimental impact on women. In the early stages of the pandemic, more women than men lost their jobs. Femaledominated industries such as the hospitality, retail and service sectors were heavily affected. Although women’s employment figures have improved in recent months, I still have concerns about the long-term impact of the COVID-19 crisis on women’s workforce participation and their economic and financial security. As we move into the post-COVID recovery phase, we must make sure that women’s workforce participation is not sidelined. Our economic recovery depends on women having Issue One | January-March 2021 | MBA NSW
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WORKPLACE, HEALTH & SAFETY
GENDER EQUALITY
equal access to secure full-time jobs. Women and men must have an equal opportunity to re-engage and participate in the workforce. Employers have an important role to play in making this happen by ensuring the momentum towards gender equality is sustained. It is good for business and integral to our economic recovery.
GENDER EQUALITY
Only 5.7% have set targets for employee engagement in flexible working and only 2.2% have set targets for men’s engagement in flexible working. To change a workplace, you have to change its culture. Flexible working strategies and policies have to become the lived reality of employees.
The latest annual snapshot from the WGEA showed access to flexible work arrangements was improving before the pandemic hit. Did that trend continue during the COVID-19 pandemic? Do you think the trend will continue after the COVID-19 pandemic?
I do believe the trend toward increased access to flexible work arrangements will continue. The COVID-19 crisis has proved to Australian employers that they can trust their employees to work flexibly and still be productive. Employees now have an expectation that they can and should be able to work flexibly. The onus is now on employers to make flexible work an essential, mainstream practice in their workplaces.
Access to flexible work has improved every year since we started collecting data. More than three-quarters (75.9%) of employers now have policies or strategies to promote flexible working which is great to see. However, our data has also identified a key problem – the flexible work action gap. Not enough employers are implementing their strategies and policies through action plans for engagement.
The basis of any successful flexible work arrangement is the trust between employer and employee. As we gradually move into a postCOVID-19 environment, most employers now know they can trust their employees. Equally, employees feel more empowered to negotiate flexible working arrangements that fulfil both the employer’s requirements and the employee’s responsibilities outside work.
Have Australian workplaces gone forward or backwards on actions to close gender gaps in the workplace? In some ways, both. On the positive side, there has been a strong increase over the last seven years in the number of employers that have analysing their remuneration data for pay gaps. It rose by 22.4pp from 24.0% in 2013-14 to to 46.4% in last year’s dataset. Unfortunately, we have also identified an action gap in this area. Although more employers have been analysing their pay data, over 45% of those who did took no action. Even worse, there was a decrease of 6.1pp in the percentage of employers that took action to close their gender pay gaps. Last year’s data shows that employer action on pay equity went backwards and the action gap widened. We cannot allow this trend to continue. Experience tells us that when employers measure their data, identify their problem areas and make a plan to address it, the pay gap closes. Our research shows that actions to close pay gaps are three times more effective
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There has been some slow progress in this area. In last year’s dataset, there was an increase in the number of men taking primary carer’s leave (up 1.4pp) to 6.5%. There was also an increase in the number of employers offering paid parental leave to both women and men (up 3.0pp to 52.4%).
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MBA NSW | Issue One | January-March 2021
The four key action areas for employers in the construction industry are the same as they are across all other industries: • Normalising flexible work for women and men • Normalising equal access to paid parental leave for women and men • Closing the action gaps by taking action on issues such as pay equity • Implementing accountability at all levels of an organisation. Accountability is crucial as it generates action to improve gender diversity We also have to ensure that change is both real and lasting. Progress towards gender equality in our workplaces does not happen on its own. Change happens when organisations set targets, measure their progress, make people accountable for the outcomes and report the results to their boards and senior executive teams.
Having a paid parental leave scheme is an important first step. As I mentioned earlier, just over half of the employers in our dataset offer paid parental leave. Of those that do offer it, they need to support and encourage men as well as women to use it. In particular, they have to ensure their male employees can use their parental leave entitlements without it having a negative impact on their career or being adversely judged by their managers and peers. Organisations have to move towards genderneutral parental leave policies, offering equitable parental leave for all parents.
The construction industry also has some specific cultural and structural issues standing in the way of progress. The UNSW Australian Human Rights Institute Demolishing Gender Structures report identified some barriers for the progression of women. These included rigid work practices, toxic cultures and hostile attitudes towards flexibility, parental leave and employees’ work-life balance. The report also revealed how construction sites work to exclude women. It found evidence of tolerance and acceptance of sexism, sexist language, sexual harassment and sex discrimination.
How diverse is the construction industry when it comes to gender?
The industry needs to re-consider its approach to gender equality. Organisations must examine their own data alongside the overall industry data and use this as the basis for a genuine discussion about the barriers women face and the issues men face in the industry. The construction industry has to challenge some of its long-standing assumptions about how and when work gets done – If you keep doing things the same way, change cannot happen.
In short, our data paints a stark picture which shows that the construction industry lacks gender diversity across all of its manager categories and non-manager occupations.
What can construction companies
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do to improve gender equality?
Normalising access to paid parental leave for women and men is a key action area for employers. Aboloshing the labels of ‘primary’ and ‘secondary’ carers is important. Employers have a crucial role to play in making it a mainstream working practice and allowing men to access the same leave entitlements as women is imperative.
The traditionally masculine roles in the industry have continued to remain this way. Women comprise 4.0% of machinery operators and drivers, 15.3% of labourers and 3.1% of technicians and trades. By contrast, they dominate the clerical positions, with women comprising 77.7% of clerical and administrative workers.
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Do you think more or fewer men are taking paid parental leave as a primary carer? Why?
The Construction industry is the second most male-dominated industry in our dataset after the Mining industry. Only 18.1% of its employees are female. Women comprise just 2.7% of chief executive officers, 15.1% of key management personnel and 13.0% of all managers. These figures are all far lower than the national average. The industry also has a low representation of women in management compared with representation across the industry: 13.0% compared to 18.1%.
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when the results are reported to the executive or Board.
What are some of the actions organisation can adopt to increase the number of women in leadership roles? Our data shows that we do not have enough female leaders in Australia and women are not moving into senior management roles at a fast enough rate. Dedicated employer action is one of the keys to changing this situation. Traditionally, the leadership culture in Australian workplaces has been developed around the needs and circumstances of men. The Women in Leadership Report we produced in collaboration with McKinsey + Co and the Business Council of Australia in 2017 clearly shows that organisations must take a
WORKPLACE, HEALTH & SAFETY
systematic approach to increase the number of women in leadership. The research showed a clear correlation between the representation of women in senior roles and the availability of more flexible working options, including part-time roles for managers. Agency data reveals that currently only 6.4% of manager roles are worked parttime. Considering that women are three times as likely as men to work part-time, this is a real barrier to women’s career progression into senior leadership roles. The Women in Leadership Report demonstrates that organisations which succeeded in boosting women’s representation in senior leadership roles used a suite of 10 practices. As well as normalising flexibility, these include a meaningful internal business case for gender equality, leadership accountability, opportunities for women to gain experience in key operational roles and access to the active sponsorship that men have long benefited from. The findings of 2019 BCEC WGEA Gender Equity Insights Report back up the Women in Leadership Report which identified the normalisation of flexibility as a key driver of improving the representation of women in management. It shows that implementing formal flexible work arrangements and reporting this to the board significantly increased the number of part-time female managers. Another key finding of the report shows that access to paid parental leave also improved the representation of women in management. Female managers are twice as likely to return to work if their employer provides 13 or more weeks of paid parental leave. We had always suspected that the normalisation of flexible work and access to paid parental leave was crucial in getting women into management roles and keeping them there. Now we have some solid evidence to support this. Finally, the report identified that companies with a female CEO reported an increased number of women managers, as did those organisations who moved from all-male to gender-equal company boards. What these findings reveal is that if you change the working conditions available to all employees, the choices women make change too. Access to paid parental leave and flexible work arrangements actually enables more women to choose to return to work, stay in the workforce and move into senior leadership and management roles. *Note: The WEGA data is based on 4,943 reports submitted in accordance with the Workplace Gender Equality Act 2012 for the reporting period 1 April 2019 to 31 March 2020. The data covers over four million Australian employees. Issue One | January-March 2021 | MBA NSW
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