The gender pay gap, hard truths and actions needed
GS Paper 1: Social Empowerment
Important for
Prelims exam: Global Wage Report 2020–21, EPIC
Mains exam: Social and economic justice for working women
Context
18 September was the Third International Equal Pay Day 2022, which represents the longstanding efforts towards the achievement of equal pay for work of equal value.
How pandemic affects the labour force
- COVID-19 pandemic had a disproportionate effect on women workers in terms of job and income losses.
- Women’s labour force participation rate which was at 9.4% in the year 2021 and proved to be the lowest since 2016.
- The job security during lockdown was unequal; where 61% of male workers had secure jobs, only 19% of female workers had that privilege.
- While the full impact of the pandemic is yet to be known, it is clear that its impact has been uneven, with women being among the worst affected in terms of their income security, partly due to their representation in sectors hard hit by COVID-19, combined with the gendered division of family responsibilities.
- Many women reverted to full-time care of children and the elderly during the pandemic, foregoing their livelihoods to do so.
- The International Labour Organization’s “Global Wage Report 2020–21” suggests that the crisis inflicted massive downward pressure on wages and disproportionately affected women’s total wages compared to men.
- This greater wage reduction for women means that the pre-existing gender pay gap has widened.
Possible reasons behind this gap
- A large part of the gender pay gap can be attributed purely to discrimination based on one’s gender or sex.
- Though individual characteristics such as education, skills or experience are also responsible for gender pay gap.
- Gender-based discriminatory practices includes:
- lower wages paid to women for work of equal value;
- undervaluation of women’s work in highly feminised occupations and enterprises, and
- motherhood pay gap- lower wages for mothers compared to non-mothers.
Global efforts to close the gender pay gap
- The ILO has enshrined ‘equal pay for work of equal value’ in its Constitution.
- The Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) provides an international legal framework for realising gender equality and addressing the intersecting forms of discrimination and vulnerabilities among women and girls.
- Equal Pay International Coalition (EPIC): It is an initiative driven by stakeholders committed to reduce the gender pay gap and make equal pay for work of equal value a reality across all countries and sectors.
EPIC is led by the ILO, UN Women and OECD.
This Coalition engages with governments, employers, workers and their organisations, the private sector, civil society and academia to take concrete steps to accelerate the closing of the gender pay gap and the achievement of pay equity.
- SDGs Goal 8: Decent work and economic growth
- Target 8.5: By 2030, achieve full and productive employment and decent work for all women and men, including for young people and persons with disabilities, and equal pay for work of equal value.
Gender pay gap in India
- Despite notable progress in closing the gender pay gap over time in India, the gap remains high by international standards.
- Indian women earned, on an average, 48% less compared to their male counterparts in 1993-94. Since then, the gap declined to 28% in 2018-19 as in the labour force survey data of the National Sample Survey Office (NSSO).
- The pandemic reversed decades of progress as preliminary estimates from the Periodic Labour Force Survey (PLFS) 2020-21 show an increase in the gap by 7% between 2018-19 and 2020-21.
- The data suggests that a faster decline in female wages during the pandemic contributed to this decline, compared to a faster growth in male wages, which requires urgent policy attention.
Steps taken by India
- Code on Wages: The Code on Wages, 2019, has been notified in August 2019, and the provisions of the Payment of Wages Act, 1936, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965 and the Equal Remuneration Act, 1976, have been rationalised and subsumed therein.
- The Code provides for universal minimum wage across employment in organized and unorganized sectors.
- The Code mandates the Central Government to fix floor wages and that the minimum rates of wages fixed by the appropriate Governments shall not be less than the floor wage.
- The Code prohibits gender discrimination in matters related to wages and recruitment of employees for the same work or work of similar nature done by an employee.
- Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA): This act had benefited rural women workers and helped reduce the gender pay gap, both directly and indirectly.
- Directly, by raising the pay levels of women workers who participated in the programme.
- Indirectly, benefits accrued to women involved in agricultural occupations through higher earnings, as MGNREGA contributed to the rapid rise in overall rural and agricultural wages in the country.
- Maternity Benefit Act of 1961: In 2017, the Government amended the Maternity Benefit Act of 1961, which increased the ‘maternity leave with pay protection’ from 12 weeks to 26 weeks for all women working in establishments employing 10 or more workers. This is expected to reduce the motherhood pay gap among mothers in the median and high-end wage earners working in the formal economy.
- Skill India Mission: The mission equips women with market-relevant skills to bridge the learning-to-livelihood gap and the gender pay gap.
Conclusion
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. Accelerated and bold action is needed to prevent a widening of the gender pay gap and closing the existing gap.
Equal pay for work of equal value is necessary to close the gender pay gap. Closing the gender pay gap is key to achieving social justice for working women, as well as economic growth for the nation as a whole.