CLOSING GENDERPAY GAPS TO ACHIEVE
GENDER EQUALITY
AT WORK
Guidance Note | Principle 2

THE ISSUE
Women globally are paid on average 22 per cent less thanmen.1 Some company level data shows a mean gender pay
gap of 20 per cent. 2 The largest gender pay gaps are usuallyfound at the top of the wage distribution—the ‘glass ceiling’for highly skilled women workers—and at the bottom—the‘sticky floor’ for women working in the lowest paid jobs. 3
Gender pay gaps among women show wide variations
across countries and between different groups of women,
depending on their age, race, ethnicity, migration status andother categories of disadvantage. Women cannot be treatedas one homogenous group. For example, the gap between
mothers and non -mothers, known as the “motherhood paygap,” ranges from one to as much as 30 per cent.4 Womenfrom ethnic minorities face multiple barriers and even wider
gaps in pay and advancement in the workplace.5 There arealso increasing indications of a pay gap between lesbian,gay, bisexual, transgender and intersex (LGBTI) andnon-LGBTI workers.6
Part of gender pay gaps can be explained by factors such as
education and training, care responsibilities, work experience, enterprise size and union density. Yet much of the pay
gap remains unexplained, which reflect discrimination,
implicit biases and social norms in society, further replicatedat the company level. These gaps lead to huge disparities inearnings over lifetimes, that continuously reinforce women’s
unequal position in the labour market and the workplace.

WEPs Guidance Note: Closing gender pay gaps

While the gender pay gap is slowly narrowing, at the current
rate of progress it will take more than 70 years to close it
completely.7 Bold action is therefore needed to both prevent
widening of gender pay gaps, and close existing gaps.8
Companies play an important role in addressing gender pay
gaps and are increasingly taking action to remove discrimination in the workplace. Some actions emanate from stronger
government regulations to neutralize gender pay gaps,
requiring companies to track and report wages of theiremployees. Still, many organizations do not yet uphold theprinciple of “equal pay for work of equal value”.

Box. 1

WEPs Tool Kit

This guidance note forms part of a tool kit to help signatorycompanies implement the Women’s Empowerment Principles(WEPs) (see Box 2). It shows how closing the gender pay gap
makes business sense and benefits both employers andemployees. It specifically aims to support WEPs signatories
in prioritizing, establishing and implementing equal pay policies and practices to ensure that all women and men aretreated fairly at work (Principle 2).
Companies are offered guidance on how to implement
the principle of equal pay for work of equal value, including
through UN Women’s new self-assessment tool. This note
was prepared by UN Women’s three programme teams incollaboration with ILO (see page 7).

1

EQUAL PAY FOR WORK OF EQUAL VALUE
The principle of equal pay for work of equal value is set out
in the International Labour Organization’s (ILO) Equal
Remuneration Convention, 1951 (N°100), ratified by 173
countries.9 Article 1 defines equal remuneration for womenand men workers for work of equal value in terms of rates
of remuneration established without discrimination basedon sex.10 Relatedly, Goal 8 of the Sustainable Development
Goals aims to achieve full and productive employment anddecent work for all women and men, including for young
people and persons with disabilities, and equal pay forwork of equal value by 2030.

Box. 2Equal pay for work of equal value means that women andmen receive the same pay when they do identical or similarjobs, and also when their roles are different but have similar
working conditions or demand the same level of skill, training,effort or responsibility. This means that when women andmen perform work that differs in content but is determined
to be of equal value based on objective criteria (qualifications,
effort, responsibility and working conditions) they should
receive equal remuneration.11 Applying the principle of equalpay for work of equal value is critical to address the conscious
and unconscious biases in determining the value of workand eliminating gender-based discrimination towards theachievement of gender equality.12

Women’s Empowerment Principles

High-level corporate
leadership

Education and training
for women

Workplace HR

Supplier diversity& marketing practices

The Women’s Empowerment Principles (WEPs) offer guidance
to companies on how to promote gender equality and women’s
empowerment in the workplace, marketplace and community.
Jointly established by UN Women and UN Global Compact, theWEPs are grounded in international labour and human rights
standards and the recognition that businesses have a stake in, anda responsibility for, gender equality and women’s empowerment.

Employee well-being
and safety

Community
engagement

Measurement andreporting

The WEPs bring together different stakeholders to raise awareness and implement business practices that empower women,
including in the context of the 2030 Agenda for Sustainable Development and the Sustainable Development Goals. Goal 8 promotes sustained, inclusive and sustainable economic growth, fulland productive employment and decent work for all.

2

THE BUSINESS CASE
Closing the gender pay gap is not only the right thing to do
but it also has positive multiplier effects for companies.
Companies increasingly recognize that it is a win-win businessstrategy as closing gender gaps helps attract and retain
staff and increases performance, retention and productivityof the workforce. It also contributes to increased growth andsustainability for companies and the economy at large.
Respecting gender equality principles and actively putting
in place policies and practices to close the gender pay gap
allows organizations to:•••

Increase satisfaction, commitment, and motivationof employees: When workers feel that they are valued
and their pay is fair, it can foster a higher level ofcommitment to an employer associated with better job
performance and increased productivity.13 In contrast,
when employees think they are underpaid or undervalued it can lead to staff turnover, which is costly forthe company.
Enhance company reputation internally and externally:
Companies that actively address gender pay gaps tend
to have a reputation for being more innovative and agreat place to work. Now more than ever, this is key asshareholders and stakeholders, including millennials
and Gen Z’s express heightened expectations of thecompanies they work for, buy from, and invest in.14
Attract and retain the best talent: Workers are choosing
to align themselves with organizations that have values
that match theirs. Companies that value fairness for all
workers and address the gender pay gap can help
attract and retain the best talent. Whereas companies
with larger pay gaps than their competitors are at risk oflosing out on the best talent. The gender pay gap has
been shown to influence women’s choice of employers,
and its existence reduces their job motivation andcommitment to their employer, which can lead toincreased staff turnover.15

WEPs Guidance Note: Closing gender pay gaps•

Improve human resource management practices:
Greater efficiency in staffing practices, reduced timespent on pay management, improved pay policy
and harmonized pay structures based on the value ofjobs can increase human resource management’s
effectiveness and productivity.16•

Increase a company’s sustainability and attractivenessto investors: Companies that are more productive,
more profitable and maintain a positive reputation tend
to be more sustainable. Investors are interested ineliminating uncertainty and increasing confidence intheir investments, which means holding companies tomore rigorous standards and choosing to invest incompanies with “purpose and profit” that are sustainably
productive over the long-term.17

Box. 3

Closing the gender pay gap in France

Similar to other countries who have passed legislation requiring companies to address the gender pay gap, France
unveiled an action plan for gender equality in the workplacethat contains ten measures to reduce the gender pay gap18 inMarch 2018. The measures include effectively applying theprinciple of “equal pay for equal work.”
The creation of an equal pay index is one of the most ambitious measures as it sets up an obligation to achieve results
in closing the gender pay gap. Companies are now required to
publish and report gender pay gap information, and, if necessary, put in place corrective measures. Companies failing to
do so will be given three years to close any unexplained pay
gaps, or face a financial penalty by their administrative authority up to 1% of the total remunerations paid during the periods
in which the company has not complied with its obligations.
Of the major French companies that published results as of
1 March 2019, a fifth had scores of less than 75 out of 100
and could be subject to the fine if they fail to improve within
three years. The average score of the companies that havereported is 80. Some reports from French companies express
that the new law has created positive competition between
employers keen to improve their reputations and attract thebest staff.19

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WHAT CAN COMPANIES DO?
PROMOTE PAY TRANSPARENCY
Closing the gender pay gap is dependent on greater pay
transparency. Pay transparency refers to the disclosure of
the earnings of employees and any gender pay gaps.
Setting and sharing publicly the criteria used to determine
pay structures can help employers and employees ensuretransparent, fair and non-discriminatory processes. 20 In somecases, pay transparency itself lowers the gender pay gap as
pay for all employees increases, while that of men at a slower
rate than that of women so that gaps narrow over time.21
Pay transparency gives employees confidence that their pay
is fair and non-discriminatory, which has been shown to be a
motivation for greater productivity and team collaboration.22
Pay transparency helps both employers and employees obtain
the information necessary to assess gender discrimination
and rectify pay gaps as well as negotiate fair remunerationthat can reduce the risk of an unequal pay claim againstcompanies. 23 Conversely, not disclosing pay can reinforce
gender discrimination in business practices and create
suspicion and a lack of trust among colleagues or between
employees and employers.

DETERMINE WORK OF EQUAL VALUE
AND REVIEW REGULARLY
To identify gender pay gaps and establish work of equalvalue it is necessary to gather comprehensive pay data andperform pay equity analyses of compensation practices.
This means determining the numerical value of jobs basedon a range of gender-neutral criteria, such as skills,
qualifications, responsibilities, effort and working conditions,and ensuring that the evaluation is free from gender bias. 24
Through this assessment, companies can make sure thatfemale-dominated jobs are not undervalued or underpaid.
In fact, female-dominated occupations tend to have lower
wages, even after controlling for some other characteristics.25
This may be linked to the overall undervaluing of women’swork, meaning that skill and experience in female-dominatedoccupations tend to be rewarded unfairly. 26

Assessing the value of different jobs on the basis of common
and objective criteria contributes to more transparent andefficient systems to determine the pay structure for jobs,
while improving recruitment and selection procedures. 27
Companies can take the following actions to perform
thorough pay equity analyses.
Identify female-dominated and male-dominated jobs to becompared: Since female-dominated jobs are likely to be
subject to wage discrimination, it is important to identify
which jobs in the company are female-dominated andidentify male -dominated jobs to be compared in order toassess pay gaps:28•

Collect pay data on these jobs;•

Determine the value of jobs using theestablished common and objective criteria;•

Estimate pay gaps between jobs that havebeen determined to be of equal value;•

Make necessary pay adjustments to close
gender pay gaps;•

Conduct regular pay equity reviews.

Regular reviews and analysis of pay structures offer criticalinsights to help companies develop informed solutions thattackle the causes of pay discrimination.
Based on the ILO’s step by step guide on gender-neutral job
evaluation for equal pay, 29 UN Women developed the
Diagnosis for Equal Remuneration tool to help companies
and other organizations assess whether their pay scales
recognize work of equal value and measure the possible
existence of gender pay gaps (see Box 5).

Box. 4EPIC

EPIC is the Equal Pay International Coalition. Led by the ILO,
UN Women, and the OECD. The Coalition’s goal is to achieveequal pay for women and men everywhere. By bringing together a diverse set of actors with different areas of focus
and expertise, EPIC supports governments, employers, workers, and their organizations to make concrete and coordinated progress towards this goal. EPIC is currently the only
multi-stakeholder partnership working to reduce the gender
pay gap at the global, regional and national levels. For more
information see www.equalpayinternationalcoalition.org

4

STOP REQUESTING PAY HISTORY
Basing current wages on previous wages perpetuates theexisting gender pay gap. This means that a woman’s(or man’s) pay history or past salaries should not determine
the level of the present or prospective salary, but rather thevalue of the job itself (as outlined in the preceding section).
Governments are increasingly adopting laws and regulations
that prohibit employers from requesting salary history
information from job applicants.

ESTABLISH AN EQUITABLEREWARD SYSTEM
The current systems to determine raises, bonuses, 		
promotions and other rewards for performance tend tofurther enlarge the pay gaps between women and men.
To establish and enforce equitable, merit-based reward
distribution among women and men, companies first needto develop and disclose objective and transparent criteria
for raises, bonuses, promotions and other rewards. 30
Transparency means being open about processes, policies
and criteria for decision-making and communicating thisclearly to all employees. This also requires that managers
understand that their decisions need to be evidence-based
and reviewed by others.31

OFFER PAID MATERNITY, PATERNITY
AND PARENTAL LEAVE
Offering paid maternity, paternity and parental leave, andencouraging men to take time off for care responsibilities,
can help reduce gender pay gaps. This can also help
eliminate, or at least reduce, the motherhood penalty byrebalancing the expectations that women should be thecaregivers thereby supporting a greater sharing of unpaid
care and domestic work. 32
Mothers tend to be penalized in terms of pay, bonuses orpromotions for taking maternity leave, working reduced
hours or adopting flexible work schedules, a consequence of
their disproportionate responsibility for unpaid care andfamily responsibilities.33

WEPs Guidance Note: Closing gender pay gaps

After returning from work after prolonged parental leave,
a good practice is to grant pay increases similar to possible
increases paid to employees during the time of their parental
leave. 34 Providing or subsidizing childcare and elderly careservices are examples of family-friendly policies that can
support women’s retention in employment and help reduce
gender pay gaps.

SUPPORT FLEXIBILITY
Flexible work arrangements can support work-life balance,
which is important for employees to remain productive andmanage their work and family responsibilities. However,there is still widespread perception that presence in theoffice or at the worksite is more valuable and is thus more
often rewarded. This adversely affects women given theirdisproportionate responsibility for unpaid care and domestic
work and their greater reliance than men on flexible working
arrangements to manage their paid and unpaid work. 35
Workplace culture that supports, rather than penalizes, flexible
work for both women and men will not only help reduce
gender pay gaps, but it can also support a greater sharing
of work and family responsibilities between women and men.

Box. 5

UN Women’s Diagnosis
for Equal Remuneration

UN Women’s Diagnosis for Equal Remuneration tool, developed under the EU-funded Win-Win programme, is a
new self-assessment tool to support companies and organizations grappling with the challenges of eliminating gender
pay gaps. It helps assess whether a company’s pay structure
recognizes work of equal value. The tool can be applied byany organization - whether private company, public entity,
association or foundation – with paid employees.
The tool has been designed to be accessible and simple touse, and to accurately identify and estimate the magnitude ofgender pay gaps. The company enters the requested data
in an Excel table that then automatically performs calculations and generates charts. Because it is a self-assessment
tool, the confidentiality of the information and results isguaranteed.
The tool will also help companies align their business practicewith the WEPs. For more information and to download UN
Women’s Diagnosis for Equal Remuneration tool in English,
Portuguese and Spanish, please see https://www.weps.org/
resource/diagnosis-equal-remuneration.

5

Box. 6

Additional Tools and Resources

The ILO’s Promoting Equity: Gender-neutral job evaluation for equal pay is a foundational step-by-step guide forworkers’ and employers’ organizations, officers of Equal Opportunity Bodies and human resource managers, genderspecialists and pay equity practitioners to promote equal pay
for work of equal value. Available at www.ilo.org.
The Women’s Empowerment Principles Gap Analysis Tool
(WEPs Tool) helps companies identify strengths, gaps, andopportunities to improve their performance on gender equality. Available at: weps-gapanalysis.org/

SUPPORT COLLECTIVE BARGAINING
Collective bargaining arrangements are associated with lesswage inequality and can help reduce gender pay gaps. 36
For example, collective bargaining promotes transparent

and fair systems of pay, and can put in place grievanceprocedures for workers who have been discriminated against.
Collective bargaining often helps raise wages for workers
and secure paid leave policies, which can help reduce pay
discrimination, ensure living wages for all employees andclose gender pay gaps.

ALLOCATE A DEDICATED BUDGET
Companies should allocate a special (temporary) budget toeliminate the differences in wages between women and men.
To adjust pay in cases where pay gaps explained by gender
discrimination are found, a portion of the budget should go
to one-off individual adjustments. 37 Holding a portion of thebudget to be applied at the end of the annual salary review
will help further reduce any possible gender pay gaps.

ENDNOTES
1

2

Gender pay gap of 22% is obtained when using medianmonthly wages. International Labour Organization (ILO).
2018. Global Wage Report 2018/2019: What lies behindgender pay gaps. ILO, Geneva.
2019 Bloomberg Gender Equality Index, evaluating 230
companies from 36 countries. Media gender pay gap is 17
per cent. For more information see the Index Factsheet, data.
bloomberglp.com/company/sites/46/2019/04/2019_GEIIndex_factsheet1.pdf

3

UN Women. 2015. Progress of the world’s women 2015 –2016: Transforming economies, realizing rights.

4

ILO. 2018. Global Wage Report 2018/2019: What lies behindgender pay gaps. ILO, Geneva. ilo.org/wcmsp5/groups/
public/---dgreports/---dcomm/---publ/documents/
publication/wcms_650553.pdf

5

Data show that, compared with Caucasian men, Caucasian
women on average earned 15 per cent less, Asian women
earned 22 per cent less and black women earned 39 percent less according to ILO. 2019. A Quantum Leap for Gender
Equality: For a Better Future of Work for All. ILO, Geneva.
www.ilo.org/wcmsp5/groups/public/---dgreports/--dcomm/---publ/documents/publication/wcms_674831.pdf

6

OECD. 2017. The Pursuit of Gender Equality: An Uphill Battle.
oecd.org/publications/the-pursuit-of-gender-equality9789264281318-en.htm

7

ILO.2016. Closing the gender pay gap: A review of the issues,policy mechanisms and international evidence.

8

UN Women. Tackling the Gender Pay Gap: from Individual
Choices to Institutional Change. Policy Brief, No. 6.

9

As of August 2019, for more information see: www.ilo.org

10 According to the Convention, remuneration includes“the ordinary, basic or minimum wage or salary and any
additional emoluments whatsoever payable directly or
indirectly, whether in cash or in kind, by the employer to theworker and arising out of the worker’s employment.” ILO
Labour Standards, C100 – Equal Remuneration Convention,
1951 (No. 100).
11

ILO. 2009. Pay Equity: A Key Driver of Gender Equality, andEqual Pay International Coalition (EPIC) Brochure, see: www.
equalpayinternationalcoalition.org

12

ILO. 2019.

13

Peggy Cloninger, Nagarajan Ramamoorthy, and Patrick
C. Flood, “The Influence of Equity, Equality and Genderon Organizational Citizenship Behaviors,” SAM Advanced
Management Journal 76, no. 4 (2011): 37–47.

14

See for example, The Deloitte Global Millennial Survey
2019: Societal discord and technological transformation
create a “generation disrupted.” deloitte.com/content/dam/Deloitte/global/Documents/About-Deloitte/deloitte-2019millennial-survey.pdf

15

Equality and Human Rights Commission, “Gender pay gap
determines women’s choice of employers.” 10 October 2018.
equalityhumanrights.com/en/our-work/news/gender-paygap-determines-women%E2%80%99s-choice-employer

16

ILO. 2009.

17

See for example, Larry Fink, CEO of BlackRock, Inc., 2019
Letter to CEOs, “Purpose & Profit.”

18

Other countries include: Canada, Germany, Iceland, Ireland,
Spain and the United Kingdom.

19

See Government of France website available at:gouvernement.fr/en/; See also, Mallet, Victor, “Over 100 ofbiggest companies in France miss equality targets”, Financial
Times, 8 March 2019. ft.com/content/8b6a7440-4110-11e99bee-efab61506f44

20 ILO. 2009.
21

Bennedsen, M, Simintzi,E et al. “Do firms respond to gender
pay gap transparency?”, 5 November 2018.

22 Huet-Vaughn, Emiliano. 2013. “Striving for Status: A Field
Experiment on Relative Earnings and Labour Supply,” UC
Berkely, November 2013.
23 Equality and Human Rights Commission, “Gender pay gap
determines women’s choice of employers.” 10 October 2018.
See also: ILO. 2018. Global Wage Report 2018/19.
24 For more detailed guidance, see: ILO. 2009.

26 Grimshaw, D.; Rubery, J. 2015. The motherhood pay gap:
A review of the issues, theory and international evidence,
Conditions of Work and Employment Series No. 57, Inclusive
Labour Markets, Labour Relations and Working Conditions
Branch (Geneva, ILO).
27 ILO. 2009.
28 Ibid.
29 Government Equalities Office, The Behavioural Insights
Team, Canada. Reducing the gender pay gap andimproving gender equality in organisations: Evidencebased actions for employers. bi.team/wp-content/
uploads/2018/06/GEO_BIT_INSIGHT_A4_WEB.pdf
30 ILO. 2018.
31

See for example, unwomen.org/en/news/stories/2015/5/themotherhood-penalty-an-infographic-for-mothers-day-2015

32 See for example, France’s Gender Equality Index: travailemploi.gouv.fr/IMG/pdf/indexegalitefemmeshommes-ve03-pageapage.pdf
33 ILO. 2009.
34 Hayter, S. and Weinberg, B. 2011. “Mind the gap: collective
bargaining and wage inequality”, in S. Hayter (Ed). The Roleof Collective Bargaining in the Global Economy (Geneva, ILO
and Cheltenham, Edward Elgar.
35 Rubery, Jill and Mathew Johnson. 2019. “Closing the Gender
Pay Gap: What Role for Trade Unions?” ILO ACTRAV Working
Paper.
36 Michelle J. Budig, Joya Misra, and Irene Boeckmann, “WorkFamily Policy Trade-Offs for Mothers? Unpacking the CrossNational Variation in Motherhood Earnings Penalties,” Workand Occupations 43 (2) (2016): 119–177.
37 Male Champions for Change. Closing the Gender Pay
Gap. malechampionsofchange.com/wp-content/
uploads/2017/08/MCC-Closing-The-Pay-Gap_Report_2017_
FINAL-1.pdf

25 ILO. 2018. Global Wage Report 2018/19.

6

Promoting Economic Empowerment of Women at Work through Responsible Business Conduct in G7 Countries(WE EMPOWER—G7 Programme) is funded by the European Union (EU) and jointly implemented with the International
Labour Organization (ILO). The Programme (2018-2020) will convene stakeholder dialogues in the EU, Canada, Japan andthe US to exchange knowledge, experiences, good practices and lessons learned in the context of the changing world ofwork. Under the Women’s Empowerment Principles (WEPs), WE EMPOWER is working to equip companies to go beyond
making commitments on gender equality and women’s empowerment, to strengthening their implementation, datacollection and reporting on the WEPs.
Win-Win Programme: Gender Equality means Good Business (Win-Win Programme) is funded by the European Union(EU) and jointly implemented with the International Labour Organization (ILO), runs from 2018 to 2020 in six Latin American
and Caribbean (LAC) countries: Argentina, Brazil, Chile, Costa Rica, Jamaica and Uruguay, in partnership with the EU
countries. Win-Win Programme promotes women’s economic empowerment of women, recognising them as beneficiaries
and partners of growth and development, increasing the commitment of private sector-companies, entrepreneurs andemployers’ organizations to gender equality.
Promoting Economic Empowerment of Women at Work in Asia (WeEmpower—Asia Programme) is a collaborative
effort between UN Women and the European Union (EU) over a three year period (2019–2021) in China, India, Indonesia,
Malaysia, Philippines, Thailand and Vietnam to enable more women to lead, participate and have access to enhanced
business opportunities and leadership within the private sector to advance sustainable and inclusive growth.

ACKNOWLEDGEMENTS:
This guidance note was prepared by the United Nations Entity for Gender Equality and the Empowerment of Women(UN Women) under the WE EMPOWER – G7 programme funded by the European Union and jointly implemented with theInternational Labour Organization. The brief was led by Carla Kraft with substantive contributions from Anna Falth,Seemin Qayum, Raquel Coello -Cremades, Esther Senso Ruiz, Marianne Olesen, Meral Guzel and Mariko Saito of UN Women;
Laura Addati, Emanuela Pozzan, and Lisa Wong of the International Labour Organization (ILO); Aude Coquatrix of United
Nations Global Compact (UNGC); and Ariane Hegewisch of Institute for Women’s Policy Research (IWPR).
DISCLAIMER:
This guidance note was produced with the financial support of the European Union. Its contents are the sole responsibility of
the authors and do not necessarily reflect the views of the European Union.
Edit: Proseworks
Design: Blossom | Updates by Oliver Gantner

WEPs Guidance Note: Closing gender pay gaps

7

weps.org@WEPrinciples
empowerwomen.org@Empower_Women

Funded by:

Principle 1

Establish high-level corporate leadershipfor gender equality.

Principle 2

Treat all women and men fairly at work– respect andsupport human rights and nondiscrimination.

Principle 3

Ensure the health, safety and well-being of
all women and men workers.

Principle 4

Promote education, training and professional
development for women.

Principle 5

Implement enterprise development, supply chain
and marketing practices that empower women.

Principle 6

Promote equality through community initiatives
and advocacy.

Principle 7

Measure and publicly report on progressto achieve gender equality.

Produced by:

In support of: