Is your business missing out on top talent? Learn how fostering a workplace that celebrates LGBTQ+ employees benefits your company culture and bottom line.
There has been a great deal of progress when it comes to the acceptance and visibility of LGBTQ+ people in the workplace. But, as with the gender pay gap, there’s still work to be done. Employers have a responsibility to ensure fair treatment and equal opportunities for all employees.
This is particularly true of the LGBTQ+ pay gap: the difference in average earnings between lesbian, gay, bisexual, transgender and queer employees compared to their straight counterparts.
This article takes a deeper dive into the LGBTQ+ pay gap, the impact it has on queer people’s lives, and steps businesses of all sizes can and should take to improve how they pay their employees.
- On average, LGBTQ+ employees earn £6,700 less than straight workers.
- The shortfall is equivalent to a pay gap of 16% — almost double the UK’s 9.6% gender pay gap.
- 62% of LGBTQ+ employees have faced verbal abuse at work.
- Of the 62%, 36% were LGBTQ people of colour, and 26% were white.
- A quarter of LGBTQ+ workers would not reveal their sexuality at work.
- 35% of LGBTQ+ respondents have heard or experienced homophobic comments at work.
- 68% of LGBTQ+ workers experienced at least one type of sexual harassment at work.
What is the LGBTQ+ pay gap?
The LGBTQ+ pay gap refers to the difference in average earnings between Lesbian, Gay, Bisexual, and Transgender employees compared to their straight colleagues, caused by systemic fear or aversion to differences from the norm.
This is also why there is an ethnicity pay gap, a class pay gap, and a gender pay gap at many companies, due to the majority of business boardrooms statistically being dominated by the same group of white, upper or middle class men.
Research by the Trades Union Congress (TUC) suggested that the LGBTQ+ pay gap is currently at a significant 16%, meaning LGBTQ+ workers earn an average of £6,703 less per year.
Why does the LGBTQ+ pay gap exist?
There are several factors that contribute to the disparity in pay. Here are some of the key reasons:
- Homophobia: homophobia encompasses a range of negative attitudes and feelings toward LGBTQ+ people based on irrational fear and has been defined as contempt, prejudice, aversion, hatred or antipathy. It is typically fuelled by general ignorance or religious beliefs that preach against alternative sexualities. At best, homophobic people are dismissive and are prone to perform microaggressions – and at worst they can become violent.
- Discrimination + unconscious bias: LGBTQ+ employees may face assumptions about their personal lives during recruitment, promotion, and salary negotiations which tend to lead to lower pay offers and missed opportunities. Recruiters and managers might hold unconscious biases against LGBTQ+ candidates, potentially overlooking them for promotions or leadership roles.
- Lack of transparency: a significant number of businesses (around 87%) don’t currently monitor their LGBTQ+ pay gap using HR and payroll software. This lack of transparency makes it difficult to identify and address potential discrepancies.
- Workplace climate: one in five workplaces reportedly lack policies supporting LGBTQ+ staff, according to TUC. This is apparent not just in larger companies but in the SME and startup ecosystem too. When employees feel they cannot be open about their sexual orientation or gender identity, it can stifle career progression and hinder access to equal pay.
- Career progression: feeling pressure to hide their sexual orientation or gender identity can limit networking opportunities and hinder career advancement for LGBTQ+ employees.
The impact of the pay gap
The LGBTQ+ pay gap has a negative impact on both individuals and businesses.
For LGBTQ+ employees, lower earnings can lead to financial strain, reduced opportunities, and a sense of workplace injustice. Companies, on the other hand, lose out on the full potential of a diverse workforce.
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Sarah, a talented marketing manager with five years of experience at a prominent tech firm, felt confident applying for the open Senior Marketing Manager position. She had consistently exceeded expectations, leading a successful social media campaign that boosted brand engagement by 30%.
During the interview process, Sarah felt a subtle shift in the dynamic when her partner, Emily, was mentioned. A seemingly innocuous question about weekend plans turned into a pointed inquiry about “who takes care of the house” – an implication Sarah felt wouldn’t have been directed at a straight male colleague.
Sarah also toned down her personal style, opting for more conservative clothing choices compared to her usual self-expression. This aligns with a fear many LGBTQ+ individuals have of being stereotyped or seen as unprofessional.
The constant self-editing took a toll on Sarah. She felt like an imposter, sacrificing her authenticity for perceived career advancement.
This internal conflict can negatively impact mental health, with a 2021 study by the Trevor Project highlighting that 40% of young LGBTQ+ people seriously considered attempting suicide in the past year.
While Sarah aced the technical aspects of the interview, she was ultimately passed over for the promotion, with the feedback citing a need for someone with “stronger leadership qualities.” This left Sarah questioning the true reason behind the decision.
Later, reflecting on the meeting, Sarah realised she hadn’t fully shared her creative vision for the campaign. Worried about appearing “different” or drawing unwanted attention, she held back.
This case study highlights the impact of an organisational culture where staff feel they have to hide their authentic self at work: LGBTQ+ employees who feel the need to conform may be less likely to share their unique perspectives and ideas, hindering their own career growth and potentially impacting the overall creativity and innovation of the company.
Why is closing the LGBTQ+ pay gap important?
Creating a workplace that actively supports LGBTQ+ employees isn’t just the morally right thing to do, it’s also a smart business decision. Studies by McKinsey & Company have shown that companies with greater diversity are 35% more likely to outperform their peers financially.
When LGBTQ+ employees feel comfortable being themselves and advocating for their ideas, it fosters a culture of innovation and creativity. This can lead to a wider range of perspectives being considered, ultimately leading to better problem-solving and decision-making within the company.
Additionally, a 2020 report by Diversity Best Practices found that companies with inclusive cultures have a 17% higher level of employee engagement. This translates to a more motivated and productive workforce, ultimately benefiting the company’s bottom line.
What can businesses do to close the gap?
Companies can implement several strategies to foster a more inclusive culture that avoids isolating LGBTQ+ employees:
Visibility and open communication
- Employee resource groups (ERGs): support the creation of LGBTQ+ ERGs. These employee-led groups provide a safe space for connection, mentorship, and advocacy within the company. According to HR Grapevine, 65% of LGBT+ young adults said a company’s commitment to DEI was “very important” to them when applying for a role, and 46% are currently or have previously been part of an LGBTQ+ network at work when it is available.
- Pride month and beyond: celebrate Pride Month in June, but also extend efforts year-round. Be sure to mention support for LGBTQ+ people when recruiting, by including information about company ERGS in job postings as a perk of applying, for example. Signifiers to show that your company is LGBTQ+ friendly are important, but make sure they aren’t performative. The difference is 100% in what else is done for LGBTQ employees and the wider community in the times when eyes are not on you – and LGBTQ+ people can tell the difference between true commitment and cash-grabs at specific times of the year.
- Open communication channels: create anonymous reporting systems for employees to report any discrimination or harassment. Regularly conduct surveys to gauge employee sentiment and identify areas for improvement.
- Safe spaces: sometimes people are just curious, and don’t mean to offend. If it is not too much of a burden on LGBTQ+ employees, find a few who would be happy to volunteer their time and create a safe space for people to be nosy and ask what they’ve always wanted to ask, within reason. This may go a long way in showing that we’re all pretty much the same, and goes miles in normalising the situation for everyone. Commission-based bonuses or incentives for the extra work could work well here. Please don’t ask them to do emotional labour for free – there is a big enough pay gap as it is!
Unconscious bias training
- Implicit Association Tests (IATs): IATs can help identify unconscious biases in hiring managers and leadership teams.
- Blind promotions: when promotion time draws near, a good idea is to have the accomplishments of employees written up in plain black and white, in a way that showcases the value they have brought to your company, without any other identifying information. Using this method of blind promoting would be a way to ensure that no favouritism or implicit bias occurs in the selection process.
- LGBTQ+ people in leadership: if the board skews towards any one ethnicity, gender, or sexual orientation without any higher-up representation for queer people, it may be time to reflect (or shake things up).
- Interactive workshops: conduct regular workshops that educate employees on unconscious bias, its impact, and strategies to mitigate it.
- Focus on skills and qualifications: implement clear and objective criteria for hiring and promotion, focusing on skills, qualifications, and past performance.
Inclusive benefits and policies
- Domestic partner benefits: offer comprehensive domestic partner benefits that extend coverage to same-sex spouses and their families.
- Parental leave policies: ensure parental leave policies are inclusive and offer equal benefits to same-sex couples and those considering adoption.
- Gender-neutral restrooms: consider offering gender-neutral restrooms to promote inclusivity for transgender and non-binary employees.
- Acknowledge diverse holidays and celebrations: recognise and celebrate diverse holidays and cultural events alongside traditional holidays.
1. Develop and implement a clear DEI policy that explicitly states the company’s commitment to fairness and outlines specific actions to promote an inclusive environment for LGBTQ+ employees.
2. Provide unconscious bias training for all employees, including managers and leadership teams to equip employees with the tools to overcome them during recruitment, promotions, and salary negotiations.
3. Create a safe and inclusive work environment where employees feel comfortable disclosing their sexual orientation or gender identity without fear of discrimination, through employee resource groups for LGBTQ+ staff and allies.
4. Regularly analyse pay data to identify any potential pay gaps based on sexual orientation or gender identity. Taking proactive steps to address these disparities demonstrates a commitment to fair compensation.
5. Promote a culture of open communication where employees feel empowered to discuss their concerns and experiences with management. This fosters trust and strengthens employee engagement.
Conclusion
A workplace that embraces LGBTQ+ employees isn’t just about fairness and equality, it’s an investment in a company’s success.
Studies show a clear link between diversity and inclusion, and a company’s bottom line – so by creating a culture of open communication, implementing unconscious bias training, and offering inclusive benefits and policies, businesses can unlock the full potential of their workforce.
When employees feel valued and safe to be themselves, it leads to a more engaged, innovative, and ultimately, more profitable organisation. This shift towards a truly inclusive environment fosters a positive and productive work environment where all employees can truly belong, and feel empowered to give their best.
