Attitudes to gender pay equity in smaller firms: a study of firms predominantly based in Western Australia

Currently only large firms (employing in excess of 100 people) are required to report on gender pay equity in Australia and little is known about pay equity in small to medium sized firms [SMEs] that employ significant numbers of women. The purpose of this project is to explore smaller firm owner-managers' understanding of pay equity, perceptions of its relevance to their business, attitudes to equal pay, and the structure and design of human resource management (HRM) practices that enable (or not) equal pay for work of equal value within their firm. The first aim is, within the context of informal HRM practices in smaller firms, to understand how smaller firm owner-managers know whether or not a pay gap exists within their firm and how they can be certain that pay inequity does not arise within their firm. Should they be uncertain about their pay practices, the secondary aim is to explore their knowledge about and attitudes towards undertaking a pay audit and using a tool, such as the [Equal Opportunity for Women in the Workplace Agency] EOWA's Pay Equity Audit tool developed in the Western Australian Government's Pay Equity Unit, to assist with that process. Overall the intention is to highlight to smaller firm owner-managers the importance of pay equity, the consequences of inequity and a consideration of means to rectify gaps. Research found that the EOWA pay equity tool was not suitable for small business. Coming from the interviews were a number of key themes that contribute to an understanding of attitudes in smaller firms towards pay equity. These are that: (1) there is a lack of knowledge about gender pay equity within SMEs; (2) in SMEs there are both 'traditional' attitudes of managers in relation to women's and men's work and more inclusive attitudes as a result of changes in the economy; (3) gender-segregated labour pools from which employees are recruited contributes to pay inequity; (4) awards hold back pay inequity between award covered, lower paid employees; (5) the lack of negotiation skills amongst women (especially those who were not considered to be covered by an award) contributes to pay inequity; (6) individualised 'rewards' are given to high performing or 'meritorious' employees; (7) the owner-manager's values, attitudes and previous work experience is important in terms of their treatment of women; and (8) managers and owner managers of SMEs generally have a noncommittal attitude to applying a gender pay audit to their firms. A number of recommendations are made.

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