How Startups Can Help Close the Wage Gap

How Startups Can Help Close the Wage Gap

From encouraging pay transparency to upskilling female employees—here’s how startups can help bolster pay equity.

A recent UN report revealed that women around the world earn 23% less than men. What’s worse? In 25 years, there has been very little change when it comes to pay equity. It is evident that the gender wage gap demands urgent attention.

Startups are in a unique position to help close the wage gap. In addition to promoting pay transparency, they can encourage flexible working arrangements, provide childcare benefits and upskill their female employees. By doing so, they can ensure that women are paid justifiably for their work while enhancing the company’s reputation. 

So, here are five ways in which startups can help close the wage gap:

1. Promote pay transparency

Pay transparency is about making pay information readily available to all employees. This can help employees identify any gender-based discrepancies in pay and take action if needed. It includes revealing the typical pay range for a particular role and sharing individual salaries. By promoting pay transparency, startups can help ensure that employees are paid fairly and equally for their work. 

2. Encourage flexible working arrangements

This is especially important for startups with mostly young employees. It can include flexible working hours, allowing employees to work remotely and providing parental leave. Often, while women get paid less than men, women with children are paid even less. Flexible working arrangements help keep women in the workforce after they’ve had children or during their childbearing years. It encourages them to put their best foot forward at work without compromising on their personal life. It also improves the startup’s image, depicting it as a more caring and socially-responsible firm.

3. Provide childcare benefits

Many women are forced out of the workforce due to a lack of adequate childcare options. Child care is expensive and not always available when it’s needed, which makes working difficult for both mothers and fathers alike. Startups can provide childcare and paid maternity and paternity leaves as part of their benefits package. It will encourage more women to stay in the workforce and perform better. 

4. Upskill women employees

As per the World Economic Forum, digital transformation will disproportionately affect women in the workforce. To ensure that women have relevant skills and, subsequently, a growing pay, startups must invest in upskilling their female employees. For instance, companies can provide specialized training for women on topics such as coding, public speaking and teamwork. This will help reduce the gender wage gap and position women for better paying jobs in the future.

5. Support entrepreneurship among women

Helping female entrepreneurs navigate the startup world helps close the wage gap as well. Women entrepreneurs typically face more challenges than their male counterparts and, as a result, often earn less. Supporting entrepreneurship among women not only empowers them but also creates better businesses and a stronger economy.

Creating a level-playing field

In a bid to narrow the wage gap, food startup Zomato decided to offer men and women the same amount of parental leaves. Earlier, only women would receive a maternity leave of six months. This would discourage not only firms from hiring women and giving them leadership positions but also women from re-entering the workforce. By giving men and women an equal number of paid parental leaves, Zomato has created a level-playing field for both genders to re-enter the workforce comfortably and prosper in their careers. 

Redefining HR practices

What’s more? The CEO of Hired, a job search marketplace, Mehul Patel, feels that startups have the opportunity to start their HR practices from a blank page. They are not bogged down by any orthodox norms that have dictated a company for years. They have the chance to defy societal standards and create an equitable workplace that can help close the wage gap for good.

Header Image by Freepik


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Alinda Gupta
I am a professional journalist and gourmand with an inexplicable love for caffeine. I admire old architecture and find comfort in fiction books. I am also an A1-level certified French speaker—bonne journée!


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