I've followed this time approach with my athletes for quite some time. They don't really notice the difference, but on days we have intervals scheduled, if I have the guys do 4x1600m @ 5k Race Pace w/3 min rest I will have the women do 4x1200m @ 4k Race Pace w/3 min rest. So a guy who runs 5k in 15:35 would be running around 5:00 for each mile repeat and a female who runs 5k in 18:45 (it would take just under 15 min for her to run 4k) would be doing her reps around 4:25. I also have the guys to 5 mile tempo runs while the women do 4 mile tempo runs (takes men 27 to 30 min and women 26 to 28 min). I've noticed that the average women can cover 75% of the distance of an average guy in the same time. Note - I don't make adjustments for intervals that are being run faster than mile race pace.
Having said that, you also have to look at the distance you are preparing them to run. If it takes the women (on average) 3 min longer to run 5k than it does a man (thus more aerobic), then they could benefit from a bit more aerobic work. Why would a man run 4 miles of intervals to prepare for a 3 mile race and women only run 3 miles of intervals to prepare for a 3 mile race.
Having said that, everybody is different. I've had women who run significantly more than men, even though they run the same events. It's about finding what works for each athlete. If the athlete responds well physically and psychologically to training by distance, train them that way. If the athlete respondes well to training by time, then train them like that. As a coach YOU have to be the one that's flexible. Find something that works for the athlete and continue to develop and progress the plan so the athlete reaches new levels of fitness.
*Generally though, the body has no idea how much ground it's covering. All it knows is how hard (intensity) it's working for a given period of time. Training should be designed with TIME and INTENSITY as the two primary components.