Gender Pay Gap Reporting Doesn't Go Far Enough Fast Enough
More than one InclusIQ client is nervous about what they will find when they dig into the gender pay gap numbers the UK government is requesting under The Equality Act 2010 (Gender Pay Gap 2017 Information) Regulations 2017. From this month, UK employers with more than 250 staff will be required by law to start gathering data annually on the mean and median difference in salaries and bonuses, how many women versus men received bonuses and where the two genders stack up in the organisation’s pay bands. The first gender pay gap results must be published by 4 April 2018.
This BBC short video gives a great run-down on the history of the pay gap since the first Dagenham strikers inspired the Equal Pay Act in 1970. The effects of the Act are still to be fully realised over 40 years later and what is of concern to employers is that there is nearly a 10% pay gap between full-time male and female workers in the UK, with a gap that is worse for skilled workers.
InclusIQ agrees with the Labour ministers who think the Regulations don’t go far enough or fast enough. As reported by the Guardian on this issue, Labour MP Dan Jarvis explained the delay means women will have to work effectively for free for more than four months before 2018. “This is a completely unacceptable delay, 45 years after the introduction of the Equal Pay Act,” he said.Frances O’Grady, General Secretary of the TUC, said it was a good first step but ministers need to be much bolder. “We’re disappointed that firms won’t have to publish their gender pay gap figures until 2018. There is no need for such a long delay,” she said. “And it is a real shame that bosses won’t be made to explain why pay gaps exist in their workplaces and what action they will take to narrow them.”
We agree that it’s too long in coming, so forcing a spotlight on the issue can only be a good thing. We risk demoralising millions of women every time they wonder: ‘Am I making as much as he is?’ when asked to go a little further for their employer. What effect does that cumulative seed of doubt have? There are some concerns about data distortion - namely that women are more likely to be part-time workers, that women who work full-time but take maternity leave receive less pay (or none if they extend their leave period) and that bonuses may be double counted if they are awarded half-way through the stated reporting period. These issues aside, at a time when trust in organisations is already woefully low, employees need greater transparency. It’s been our experience that being faced with the evidence of bias in numbers helps many see the pervasiveness of bias. How they react after that is what matters.
There are no plans for repercussions against companies that don’t comply, any more than there are currently for those who don’t have women on their Boards – despite government ‘encouragement’ for more gender balanced Boards. Additionally, while employers will be required to report, companies won’t have to explain any disparities they uncover. It’s a small victory, but hardly as far reaching as we’d like. There is still much to be done.