Employers can improve women’s financial security by recognizing gender differences and improving pension contribution and benefits structures, says Kadie Philp, commissioner and chief administrative officer at the Ontario Pay Equity Commission.
To close the gender pension gap, employers need to recognize how different work-life patterns can be for men and women, in addition to making contribution patterns more effective for people who have to take long-term leaves, such as parental or caregiving leave. She notes employers can start by sorting and filtering their employee data, as the patterns around leaves or benefits will highlight some crucial gaps that need to be filled.
Read: How employers can help shrink Canada’s gender pension gap
“We also know women tend to work more part-time hours . . . to make up for other things happening in their life, so it’s important to look at part-time benefit structures.”
The cause of gendered differences in income goes back to the design of the labour market, says Philp. “There were policies and practices put in place that created an artificial sex segregated labour market, meaning they prescribed the types of work men and women could do. Most of our benefits and pensions are structured fully on time worked, which [may have] worked in the 1950s and 1960s when pension systems and benefit systems were designed, but dynamics have changed.”
Women’s participation in the labour market is roughly 89 per cent now, she notes, so the dynamic has shifted, but the way in which companies structure pay and benefits hasn’t. “This creates a bigger gap in earning potential because our systems don’t reflect the reality of household earning structures anymore. And when you have less earnings potential, you have less savings potential, so we still have this historical trend that we’re trying to shift . . . but it is shifting.”
Read: My Take: Employers can do more to shrink gender pay, pension gaps
Ultimately, helping women achieve financial security is a multi-stakeholder challenge, notes Philp, noting governments need to create good policy that isn’t biased and supports women, while employers have to look at their own policies and how they’re structuring benefits to ensure they aren’t inadvertently disadvantaging women.
Women also tend to save less money because they’re busy prioritizing their children, such as contributing to a registered education savings plan. However, they also need to prioritize themselves, says Philp.
“Don’t be afraid to look at what the challenges might be with how your career is going to be structured, and then come up with solutions, be it changing your savings patterns or your consumption patterns. Women [generally] prioritize their children or their partners, so I would say women need to prioritize themselves unapologetically.”
Read: Women more worried about financial security in retirement than men: survey