Diverse workforces are fast becoming a priority for companies everywhere. Organisations are beginning to realise that hiring diverse is a financially prudent decision, and one that is vital to attract the best talent. Now employers are more keen than ever to invite talent of different social identities, be it gender, sexuality, race or disability. But in the rush for diversity, inclusion sometimes fails to keep pace. One of the most glaring examples of this is the existence of biting pay gaps, especially for people with disabilities.
The reality of disability pay gaps
Pay gaps are a phenomenon that is largely understood in terms of the financial inequality between men and women. Disability pay gaps are scarcely-known and rarely discussed. According to the International Labour Organisation (ILO), people with disabilities are paid 12% less per hour globally than other workers. The United Kingdom (UK) has one of the most comprehensive data sets on disability pay gaps. In 2021, the UK government’s surveys placed the disability pay gap at 13.8%. More recently, the Trade Union Congress in the UK indicated that the gulf of wages for people with disabilities (PwD) is even higher at 17.2%. For staff working an average of 35 hours a week, this would be a loss on wages of £82.25 per week, or £4,300 a year.
To put all these numbers in context, this loss of pay effectively means that PwD workers are effectively working for free for 2 months in a year. Another chilling statistic shows the weekly disability pay gap of £82.25 is much higher than the average living expenses (£63.50) for an individual in the UK. The financial pinch hurts more when we take into account the fact that PwD workers have higher living expenses due to their specific needs, when compared to non-disabled counterparts. What’s more is that, PwD workers have a higher likelihood of being employed in zero hour contracts which further reduces their earning capacity.
What is being done?
Just like gender pay gaps, the UK government directs large employers to make annual declarations of the percentage difference in wages for PwD and non-PwD employees. This disability pay gap reporting encourages employers to identify its primary causes. Setting up tracking and evaluating systems give them a foundation to act upon and close these gaps in the long run.
But the process of disability reporting is still rife with challenges. Firstly, UK law does not yet mandate employers to undertake disability pay transparency. It is largely voluntary practice and done by a handful of organisations. When companies do collect information, their methodology differs which makes data incomparable. Most importantly, companies might have a severe under-reporting of disability due to restricted definitions that do not account for all kinds of conditions. General fear of stigma and bias in work cultures that are not psychologically safe might also affect employee disclosure.
Tackling disability pay gaps effectively
Disability pay gaps are complex, systemic issues. But academic studies and industry role models have paved the way for effective solutions. Some things to introduce immediately include:
- Begin pay equity audits for disability immediately: A pay equity audit involves comparing the pay of employees doing “like for like” work in an organisation. It should evaluate wage differences between employees by accounting for aspects like work experiences, qualifications, performance, job titles, gender, race, age etc. According to Robert Sheen, CEO of pay equity analysis firm Trusaic, these exercises inevitably lead companies to discover that their compensation policies are always followed to the T. They are often exposed to subjective reassessments along the way that may be affected by unconscious bias.
- Isolate problem areas: Pay equity audits help companies pinpoint operational gaps which could have been major contributors to salary discrepancies for people with disabilities. This could include incorrect job classifications or multiple, uncoordinated hiring authorities. This could enable vast differences in wages for the same jobs. Once these issues have been highlighted, processes could be put in place to reorder and monitor hiring, promotion, compensation, employee turnover,changes in job duties, and general bias.
- Worry about the discontent, not the problem: In 2017, the New York Times sourced a secret spreadsheet that around 1200 employees of a well-known company created. It revealed devastating pay gaps between men and women. Dr. Kellie McElhaney, founder of the Center for Equality, Gender and Leadership at UC Berkeley says that the biggest roadblock for companies in beginning pay gap audits is the fear that they will find the problems in their processes and culture. But by choosing ignorance they overlook the real possibility of discontent festering under a calm facade. It is very easy for employees to create spreadsheets or begin dialogues about serious issues of discontent in organisations. And it is easier for media channels to capture these campaigns and publicise them.
For organisations committed to building a diverse and thriving workforce that can take them to the next level of success, championing inclusion is paramount. If people with disabilities cannot obtain financial stability in a position, they will be hard-pressed for loyalty in their organisation. They will be forced to look for an environment where their talents will be rewarded with a deserving position and a pay check that aligns with their needs.