Gender Pay Gap Reporting Is Good But Not The Whole Solution
It will still require an individual to stand up and take legal action against their employer to make a real difference.
The government has recently announced details of its gender pay gap reporting regime. Businesses of 250 employees or more will have to start calculating the pay gap from April 2017, with the first league tables published a year later. But the question on everyone’s lips is what will this mean in practice, and will the pay gap, which currently stands at 19.1%, narrow as a result?
The first point to make is that gender gap pay gap reporting is not about men and women who do the same job getting equal pay. The Equality Act 2010 (formally the equal pay act) already makes it illegal for employers to pay women less than their male counterparts for doing the same job (and has done since 1970). Gender pay gap reporting looks at the average and median pay and bonuses of men versus women in an organisation and will cover employees, workers and contractors. The numbers of men and women at different salary bands will also be reported so that career progression becomes more transparent.
It is thought that reporting the gender pay gap is likely to make businesses turn their mind to the issues causing the pay gap discrepancies. A significant gender pay gap is likely to be embarrassing for the business, generate negative publicity and could create legal exposure. For example, if a female employee is running an equal pay claim or a gender or maternity discrimination claim, evidence of a large gender pay gap will be a helpful backdrop for those claims. It is objective evidence that supports an argument that there are obstacles in the way of her succeeding at work. However, it does not necessarily follow that these obstacles are caused by discriminatory attitudes or practices, nor will a gender pay gap in itself give rise to a claim.
If it is found that there is a large gender pay gap, it is advisable that employees start asking questions discretely. The Equality Act 2010 provides protection from victimisation if an employee asks their colleague or former colleagues relevant questions about pay if the purpose is to establish the extent to which they have suffered gender pay discrimination. Sometimes, asking the person in the same job sitting next to you how much they received in a pay rise or bonus is the only way forward as “pay” discussions are cloaked in secrecy – but you will need to tread carefully and ask the questions in the right way.
Although gender pay gap reporting is a positive step in the right direction, it will not solve the problem. Woman will still have to directly challenge their employers if they feel they are getting an unfair deal. The pay gap reporting may fuel that conversation, but the conversation still needs to be had – as equalities minister Nicky Morgan said recently, woman across Britain still need to use their position as employees to “demand more from businesses, ensuring their talents are given the recognition and reward they deserve”. The truth of the matter is that not all women will feel empowered enough to challenge their employer in this way.
A multi- pronged approach is required, with education, careers advice and raising aspirations among young women about their careers remaining important, alongside tackling unconscious bias among recruiters and employers’ attitudes. Until those obstacles are tackled in tandem, the pay and progression gap is likely to continue for some time.