Building bridges across the gender pay gap

Enrico Moretti, an Italian professor of economics living in California, knows all about the women and sick days controversy here because he read about it in the Toronto Globe and Mail.

He’s used to the reaction, too, and has some sympathy for Employers and Manufacturers Association chief executive Alasdair Thompson who found himself under fire for suggesting women took more sick days because of their periods.

Thompson claimed this affected their productivity, and that this was among the reasons they are paid less than men. He has been roundly condemned but Moretti says, actually, women do take more sick days because of their periods.

He and another economics professor, Andrea Ichino analysed personnel data at an Italian bank which recorded the date and duration of every employee absence from work and found the absences of women below the age of 45 followed a 28-day cycle.

The professors concluded the menstrual cycle did increase female absenteeism and this explained at least 14 per cent of the gender pay difference. But they also found the sick days were due to genuine pain – and suggested one way to redress the pay gap was to bring in a gender-specific subsidy for women.

On the phone from America, Moretti tells Weekend Review women often challenge him about the findings when he presents the paper at conferences.

But after a long question and answer session there is less scepticism, he says.

Though he does not have data for New Zealand, he says in many Western countries women typically have more sick days than men of the same age – 7.6 more in Europe and 5.2 more in America and Canada.

\”We think that biological difference could explain at least some of it.

\”What we find is consistent with medical studies where women have turned in diaries of their conditions and their sickness and doctors find an incidence of PMS-related absences that is very consistent with our own estimate that came from the Italian data.\”

The paper is not negative towards women – on the contrary, he says.

Given women’s extra days off were found to be because of genuine pain, not shirking, the findings may have significant policy implications.

In the paper the professors write: \”If one wanted to redistribute the cost of menstrual-related absenteeism from women to men, it would, in principle, be possible to adopt a gender-specific wage subsidy\”.

This would target women and could be financed out of general taxation, thus shifting part of the economic costs of menstruation from women to men.

Moretti told Weekend Review the research was simply a small step in trying to say what the facts are and what the role of biology might be in women earning less – his guess is that child-rearing is a much bigger factor.

The gender subsidy suggestion was said slightly tongue-in-cheek to spark debate – but was also a serious idea, he said.

\”The idea of the subsidy was to say, well, if we’re really serious about gender and you think that some of it has to do with biological differences then in principle you don’t want to put that cost on the employer themselves but you want to spread it across entire society.\”

Dr Judy McGregor from the Human Rights Commission, who is proposing legislation which would remove employer secrecy about employee pay rates, was sceptical about the results but had not read the paper.

\”It’s certainly not borne out by any of the research that I know either internationally or domestically,\” said the Equal Employment Opportunities commissioner.

Further, she would wager \”a significant amount\” that if a meta-analysis were carried out on all human resource records in New Zealand monthly periods would not turn out to be a productivity issue.

The real issues about pay inequality are much more complex than a woman having a day off because she is feeling unwell because of her period, she says.

McGregor and the commission have been working on a new equality at work framework which is partly about the gender pay gap but also about fairness at work for everyone.

Included is the draft Pay Equality Bill which would remove confidentiality around what men and women earn in the workplace.

This, though not a cure for huge systemic issues, would help close the pay gap, she believes.

\”To be quite honest, I think transparency would address the disparity in starting salaries for women and it would probably make the employment relationship easier, because in fact you wouldn’t be in a confidential environment around pay which many sectors are using as a way of under-valuing their female employees.\”

New Zealanders have a natural tendency not to talk about pay, she thinks, and compounding this is a female modesty around remuneration.

Even McGregor – a former newspaper editor, an academic and a human rights commissioner – still finds it hard to negotiate pay.

\”I feel terribly uncomfortable discussing pay and never have, even as EEO commissioner …\”

She hopes the draft bill will spark debate about how to address long-standing barriers to fairness at work and the gender pay gap.

\”In our pay equality bill we’ve moved to a quite different approach. We’re saying the right to equal pay exists, it hasn’t been implemented.

\”We’re saying we’ve got anti-discrimination laws but we also need now a positive duty to equal pay which would apply across public and private sectors and part of that would be around transparency.\”

She doesn’t think this transparency would backfire and lead to workplace jealousy.

New Zealanders are mostly fair-minded, she says.

They would be appalled to know what frontline and administrative staff – many of them women – were being paid for the often tough jobs they did.

By Catherine Masters

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