Women paid more in India's listed tech unicorns, Nykaa an exception?

Would you be surprised to know there are some serious gender wage disparities in big-shot companies such as  Zomato, Paytm, Delhivery, Mamaearth, and Nykaa?

In these listed Indian tech unicorns, women employees have a higher median wage when compared to their male counterparts.

Shocking right? The exception here is Nykaa, which also comes as a big surprise given it is a female-led and female consumer-based brand. 

According to Moneycontrol, recent annual reports of these prominent tech unicorns have revealed the exact shocking truth. These reports, which highlight the differences in median wages between male and female staff, give away a clear contrast across the sector. 

For sure, it is a surprising trend regarding gender wage disparities. As India’s digital economy is continually shaped by these leading brands, it becomes essential to apprehend the implications of such disparities. 

A close look at unequal compensation at Paytm & Nykaa

In FY24, Paytm had the highest difference, with the median wage of female employees being 160 percent higher than that of their male counterparts. This also raises concerns about the company’s job distribution and responsibilities handed to employees based on gender. Men are underrepresented in some job roles, while women have been positioned at senior or important positions. 

However, in Nykaa, the median pay for women is 27 percent lower than that of their male counterparts. This is unexpected, considering the company is led by a woman founder, Falguni Nayar, and is associated with female empowerment.

Nykaa exceeds its counterparts in terms of gender balance with a male-to-female employee ratio of 1.79, surpassing Delhivery’s ratio of 17.5 male workers per female employee. Could this be just a corporate strategy for Nykaa to promote gender pay parity, or do they have some other strategy in mind? 

Implications of wage discrepancies

The visible pay differences in these big-shot brands have a strong impact on India’s labour market plus the IT sector. It could also affect the talent pool in the available job market. Irrespective of preferred job roles, a female employee might want to work with Paytm rather than in Nykaa. The better pay package and growth prospects could surely influence her to choose the former company. 

Such wage differences can bring the company in a negative light impacting its brand image and legal standing. This could even influence the investors and consumers of the brand. In this day and age, maintaining gender pay parity has become a social responsibility.  

However, many companies have made budget cuts for a decrease in available cash in FY24, which has lowered employee compensation. For instance, throughout the fiscal year, Zomato’s employees’ median compensation has lowered by 16.8%, although the compensation at Delhivery and Nykaa remained the same. 

Paytm and Mamaearth have defied the trend. Paytm had a 7% increase in median pay, while Mamaearth reported a striking 20% increase. The wage discrepancy may be a sign of differing financial standing and strategic priorities for the businesses, including the diverse effects of funding constraints. 

Executive compensation unaffected: ESOP effect

Interestingly, executive compensation has remained generous despite the wage compression in ordinary roles across the lines. The hefty remuneration of CEOs stays unaffected in times of economic crisis.

Reportedly, top executives at Paytm have spent Rs 1,138 crore on ESOP benefits, with CEO Vijay Shekhar Sharma and CFO Madhur Deora profiting the most. Top executives of the company Policybazaar received a combined Rs 201 crore in FY24. On the other hand, Zomato’s top executives received 33% of the company’s gross ESOP expenses.

The future reflected: Road ahead

India’s leading tech unicorns continue to reflect a disbalance In terms of gender parity and salary distribution. Companies that would be able to strike a balance will stand out and win the long-term race. Apart from salary issues, organizations must appreciate their employees. An all-around balance is the need of the hour that would improve the ambience of the startup ecosystem.