From October 7 until the end of the year, Brazilian women work for free. That’s one way of picturing the gender-based pay discrimination that haunts Brazilian businesses.
Brazilian men earn in about nine months the same as their female counterparts do in a whole year. Here’s another way to picture it: If women were paid the same monthly salary as men, they could work until October 6 and take the rest of the year off.
They do not, of course. Women continue patrolling our streets, designing our buildings, investing our money, growing our food, caring for our elderly, and teaching our children, and making 23 percent less, on average, than men.
This is not just unfair and wrong. It is bad for business and for Brazil´s economy. Candidates elected to Congress and the presidency in this year´s election should act to make equal pay for equal work a reality in Brazil.
Some of the pay difference can be attributed to women being underrepresented in high-paying jobs. More Brazilian women than men go to college, but as they climb the career ladder, they hit an unyielding glass ceiling. Higher education is no protection against pay discrimination—women with university degrees earn 36 percent less than men with degrees.
At the heart of the pay gap is pervasive gender discrimination. Brazil ranks near the bottom—119 of 144 countries—in wage equality for similar work, a yearly World Economic Forum survey of executives shows. What drives this inequality is discrimination often subtle enough that it is hard for women to prove it or even speak out against it effectively.
“Ana,” who works at a Brazilian bank, shared her experience with me. She asked me not to use her real name and other details of her story, for fear of reprisals.
Two years ago, Ana, a well-performing employee, received the first part of a routine bonus at the beginning of the year. Her supervisor promised her the rest—a bigger part, he said—at the end of the year. This was standard practice at her bank.
But in between, Ana disclosed that she was pregnant. This did not affect her work. But when the second part of the bonus arrived, she got the same amount as the first. Of course, the bank did not say the lower-than-expected bonus was because of the pregnancy, but she was sure it was. No other explanation was offered. “Prejudice is hidden,” she said. “It’s hard to fight it.”
The next year, after Ana came back from a six-month maternity leave, she received no bonus. Zero. She told her supervisor that she should receive a bonus at least for the six months she had worked. She didn’t.
Paying women less than men for the same job not only exposes businesses to possible lawsuits, it is just bad business.
Jairo Okret, a senior client partner at Korn Ferry, an international consulting and recruiting company, told me that companies that create a reputation for being fair and women-friendly are better at retaining top talent, the main asset of any business.
Ana, for one, considered leaving her bank. “I was really upset,” she said. She only stayed because the bank promoted her,— proof, she says, that her lower bonuses were not due to lackluster performance. Despite the promotion, she did not get the bonus she should have received.
Banks with more women on their boards perform better and are better prepared financially for a possible crisis, a recent International Monetary Fund study of 800 banks worldwide showed.
The authors found evidence that, given the obstacles women face to advance in the financial sector, those who overcome them are uniquely qualified and driven, and that is a boon for companies. But women shouldn’t have to prove they can overcome discrimination to demonstrate their worth. IMF data show that diversity of views and backgrounds leads to better decisions. Full stop.
Government has a role to play in ensuring gender pay equality. In the United States, the Lily Ledbetter Fair Pay Act of 2009 established protection against pay discrimination, and in 2016 then-president Barack Obama created the Equal Pay Pledge. More than a hundred of the largest companies signed on, with commitments to identify and rectify gender pay inequities. Several European countries have likewise enacted pay transparency measures that reveal gender pay gaps at the company level.
A recent World Bank report asserts that countries are losing billions of dollars because of differences in earnings between women and men. In Brazil, an academic study of 3,000 cities shows that the gender pay gap slows economic growth.
The new members of Congress and the Executive who will take office in January should make sure Brazilian women, like Ana, get fair wages for their work. It will be good for women and good for the whole country.