Introduction
Although researchers have quantified the extent of gender pay inequality in the workplace, they hold different opinions regarding the best strategies to use in addressing the problem (Abendroth et al. 2017). This paper compares two strategies for reducing the gender pay gap in China. They include the introduction of a skills-based approach for approving pay increments and the inculcation of a transparency culture in the workplace where people can see how managers make decisions to increase pay.
The context of this review is within the transport department of the Chinese government. At the end of this report, one strategy will emerge as the best. The effectiveness and public acceptance of this strategy define the two main evaluative criteria for selecting the best plan. However, before delving into the details of this analysis, it is first important to understand the background of the topic.
Background
Gender inequality in the workplace is a thorny issue in human resources circles. The gap in pay between male and female employees has particularly drawn the attention of intergovernmental organizations and observers, including the European Commission (2012) and the Economist (2017). Statistics reported by the European Commission (2015) reveal that men have consistently out-earned women across the board. These statistics have shown consistent patterns of bias in many countries. For example, a report developed by Calfas (2018, p. 1) revealed that up to 80% of companies operating in the United Kingdom (UK) paid women less than they did their male counterparts.
The median pay gap between both genders is estimated to be 9.7% (Calfas 2018, p. 1). These statistics represent the same outlook in America because women earn about 80 cents for every dollar paid to a male colleague (Wolfe 2018, p. 1). In China, the same pattern is reported because the earning gap ratio has worsened from 75% in 1988 to 82% in 2009 (Gu 2017). This pay gap is largely attributed to existing biases in the gender labor division (Gu 2017). Several options could mitigate this problem.
Introduction of Options
Using Skill-Based Assessments
A skill-based assessment structure is one that approves pay increases based on an employee’s mastery of skills or the acquisition of education certificates (UK Government Equalities Office 2017). In this type of system, employees receive additional pay after demonstrating that they have mastered certain skills needed to fulfill a specific job requirement (Chenoy 2017). This type of assessment criterion places an emphasis on a person as opposed to a job because skills are essentially individual-based (Auspurg, Hinz & Sauer 2017).
The use of skills as the main criteria for recruitment and promotion could address the gender gap divide in the transport department of the Chinese government. Since men mainly dominate this sector, it is important to use a skill-based approach to make pay increase decisions as opposed to a gender-based assessment criteria because the latter plan would make it easy for managers to overlook women for promotion by men being the majority.
Introduce Transparency in the Pay, Promotion and Reward Structure
Traditionally, the criterion for making payments, rewarding employees, or even promoting them is a relatively secretive undertaking of the Chinese government. However, introducing a transparency policy in this process could help to reduce the divide in the gender gap because it allows people to understand the criteria for approving pay increases. This provision allows employees to question the methodologies used to make such decisions. By embracing such a strategy, it would be easy to comment on the promotion, reward, and pay structures used by managers to award payments and expose their decisions to varied opinions, which may ultimately improve their performance (UK Government Equalities Office 2017).
Requirements
The requirements for selecting the right type of pay minimization strategy is premised on whether the technique chosen could receive a public acceptance or be effective in accomplishing the task it is designed for. Public acceptance is a key requirement for the implementation of the strategy because the department of transport is subject to public participation laws. For example, it would be inconceivable for the department to adopt a strategy that would support the recruitment of more women if doing so contravenes public expectations of service delivery, as envisioned by the Chinese society. Therefore, public acceptance of the proposed strategy is an important consideration.
The effectiveness of the department is also of equal importance to this analysis because the decision to select the best strategy will be based on the ability to effectively minimize the gender pay gap. The effectiveness of the proposed strategy will be viewed in the context of how it links the goals of gender pay minimization with the methodologies that will be used to meet the objective. The strategy will also only be considered effective if it only uses the resources allocated and delivers the anticipated results.
Comparison
McGregor et al. (2017), Bishu and Alkadry (2017) propose using a skill-based assessment criterion to make all pay increment decisions. They point out that this type of strategy has a high level of efficacy because researchers have affirmed its use in several case studies (McGregor et al. 2017; Bishu & Alkadry 2017). For example, the UK Government Equalities Office (2017) affirms its efficacy by reporting its success in an empirical study that used randomized control trials.
Part of the results showed a high level of efficacy in the use of skill-based assessment in recruitment, progression, and promotion. Therefore, it could be assumed that its use in the Chinese transportation industry would similarly demonstrate the same level of effectiveness. Based on the high level of effectiveness associated with the skills-based approach, it is one of the most widely adopted models of making pay decisions (McGregor et al. 2017).
If the introduction of a skill-based assessment strategy is evaluated based on its public acceptance appeal, it fails to perform as well as the option to improve transparency in the pay model. Stated differently, people are more likely to support increased transparency in human resource practices, as opposed to the introduction of a skills-based model to inform salary increment decisions. The reason is that a skills-based model is poorly understood not only by organizations but also by researchers alike (Quintana-GarcÃa & Elvira 2017).
It is also one of the most under-researched areas of human resource management, as explained by Pendleton and Robinson (2017). These insights show that it would be difficult to garner public support for this type of strategy, especially in a government department where public opinion is valued.
Comparatively, the introduction of a transparent system of promotions could benefit from increased public acceptance because transparency is an age-old virtue in public service administration (Agu 2016). In other words, the strategy is best suited for government offices and departments because they are supposed to satisfy public interests. Levin et al. (2016) support this view by saying that transparency promotes accountability.
Other researchers, including Agu (2016), have also highlighted the importance of eliminating ambiguity in the operations of government departments. Overall, the verdict is that increased openness to government promotion strategies has been successfully practiced within the public service sphere. Therefore, it is likely to have the same impact if adopted in the Chinese transport department. As a result, within the context of discussion highlighted in this paper, promoting transparency in the government department is likely to get more public acceptance compared to the introduction of a new policy to base pay increments on skills.
Introducing a culture of transparency in the pay, promotion, and reward structure of the Chinese transport department would not register the same level of effectiveness associated with using a skills-based approach to base all future pay decisions. Vinkenburg (2017) highlights the mismatch in effectiveness levels by saying that the introduction of a culture of transparency in organizations has not always yielded the best results in public governance because if implemented alone, it is insufficient to minimize pay gaps in the workplace. Therefore, other strategies or techniques have to support it.
Researchers such as Agu (2016) have also pointed out that transparency has often failed to improve the performance of governance standards in some organizations. This weakness is mostly attributed to the low effectiveness of the strategy in fulfilling tasks it is designed to complete. Based on these assertions, the effectiveness of a culture of transparency does not match that of using a skills-based approach to minimize pay gaps in the workplace.
Conclusion
This paper shows that the gender pay gap in the workplace is a problem in public service delivery. The issue is characterized by one gender receiving significantly more pay than the other does, simply by being male or female. Several researchers have proposed different strategies to address this problem. However, in this paper, two techniques were explored. The first one was introducing a skills-based approach to making promotion, rewards, and pay decisions, while the second one involved inculcating a culture of transparency in the workplace where people can see how the organization makes such decisions.
Both strategies could deter the use of gender-biased strategies to award pay increases. A comparison of these two strategies reveals that a skills-based technique is highly effective but has a low probability of being publicly accepted. Comparatively, a culture of transparency has a high public appeal but low effectiveness. This analysis means that both strategies have equal merits and demerits. Nonetheless, the use of a skills-based strategy should be adopted instead of the transparency-based model for reasons that are explained in the recommendations section below.
Recommendations
The Chinese department of transport should adopt a skills-based strategy because public buy-in can be attained by educating employees and the public about its importance. Doing so would make people understand that this technique is more effective than simply promoting the use of transparent human resource management procedures in the workplace. Therefore, educating the public about the high effectiveness of this strategy would make them recognize that their focus should be on adopting a plan that best minimizes gender pay gaps as opposed to one that only allows more opportunities for scrutiny.
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