News: Hierarchy weighs heavily on pay parity: Mercer survey


Hierarchy weighs heavily on pay parity: Mercer survey

Entry level women employees make about 95-99% of the compensation of their male counterparts. The percentage drops to 87-95% at mid to senior levels, reveals a Mercer survey.
Hierarchy weighs heavily on pay parity: Mercer survey

As organisations onboard the International Women’s Day bandwagon to highlight their gender parity efforts, the on-ground reality is quite different, reveals a Mercer study.

Mercer’s 2021 India Total Remuneration Survey (TRS) gathered responses from 900+companies, across 5,700 job functions and over 14 lakh cumulative employees, shedding light on persistent inequities in India’s pay parity efforts. 

According to the survey findings, female executives’ total guaranteed compensation from mid to senior levels remains 5 -15%  below that of male executives. Inadequate representation of women in leadership positions is a key driver of pay inequity, the survey suggested.

Beyond pay parity, from a representation standpoint, the data indicated an improving trend at the professional level ranging from 20-30% across industries. Particular to the tech sector, entry level roles witnessed a 43% female representation, however, the number more than halved to 12 -17% in managerial roles, with a startling 4% to 8% at executive levels.

Industries with a better female representation include but are not limited to:

  • IT
  • Customer Service
  • Engineering and Science
  • Human Resources 
  • Data Analytics 
  • Business Intelligence

Interestingly, women in managerial and executive roles are highly represented across HR, IT and data analytics. 

Job-wise breakup revealed poor representation across Legal, Compliance and Audit, and Sales, Marketing and Product Management roles.

Further, hierarchy was found to weigh heavily on pay parity. Keeping all variables the same, female compensation to male pay ratio was 95-99% at entry level. However, the ratio drastically dropped, with women executives at mid to senior levels earning only about 87-95% of their male peers. This drop was attributed to the slower pace of promotions, development opportunities, and women representation in roles which drive organisation value creation or P&L ownership. 

“The concept of gender equality is embedded in Indian Constitution. Organizations are broadly committed to Diversity and Inclusion, but there seems to be a lack of accountability to drive the progress internally,” said Mansee Singhal, Sr Principal, Rewards Consulting Leader India.

“While the new Labour codes focusing on improving women employment, pay and security at workplace are welcome, companies have to take quick strides in truly integrating and empowering women. Our research shows that if women representation improves in roles that are closer to value creation, then equity would seem to be a more achievable goal.”

Some of the progressive practices adopted by India Inc. over the years to bridge pay equity and inclusion gap include: 

  • Sensitization workshops for recruiters and hiring managers
  • Focus on campus diversity hiring
  • Career reboot and women alumni rehiring 
  • Career and professional development for women 
  • Hyper-local, proactive safety solutions for women
  • Targeted high potential women leadership succession candidates 
  • Focused increased representation of women in leadership roles 
  • Fuelling the commitment to a culture of inclusive leadership by top management 
  • Male employees as advocates for gender diversity and inclusion 

What is your take on existing diversity, equity and inclusion efforts? Participate in the DEI Index 2022 and share your inputs on the multiple parameters shaping a sustainable, scalable and meaningful DEI strategy. Click here to take the survey!

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Topics: Diversity, #BreaktheBias

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