Gender pay gap reporting is a game changer, says Fawcett Society

By agency reporter
April 4, 2018

As the deadline for gender pay gap reporting finally arrives (4 April 2018), leading gender equality campaigning charity the Fawcett Society has claimed that employers now have nowhere to hide on the issue and they should seize the opportunity it represents, rather than trying to hide or massage their figures.

The charity also claims that this exercise has the potential to be a game changer in prompting people to talk about pay and find out what their colleagues earn  -and it is calling on women everywhere today to do just that.

Commenting Sam Smethers, Chief Executive of the Fawcett Society said, “Gender pay gap reporting is a game changer in terms of workplace culture and practices. It forces employers to look at themselves and understand their organisations and it prompts employees to ask some hard questions.

“But even better than that, finally women are realising that they have a right to talk about pay and they cannot be silenced. By finding out what their colleagues earn they are then in a position to challenge any pay inequality. It is much more common than people realise.

“We are calling on women everywhere today to take that first step and simply have the conversation about pay.”

Five steps you can take as an employee

  • Talk to your co-workers about pay - find out what they earn and share information in your team.
  • Talk to your manager, ask to see your employer's report and action plan
  • Join a union, or if you are in a union, talk to your union reps about what they are doing on pay equality
  • Take it to your Women's Network if you have one. If you don't, start one.
  • Share your experiences – tweet #GenderPayGap and keep the discussion going

Five Steps you can take as an employer to address your gender pay gap

Finding out your gender pay gap figure is the first step. The next step is to look into the root causes of any pay gap and develop an action plan to address it. Ask yourself:

  • Do you have more men at the top, which may represent a failure to properly recruit or promote women?
  • Are your female employees mostly in lower-paid roles? Why is those women’s work not better paid, and why are they not being promoted?
  • Has the pay gap reporting process uncovered any discriminatory practices in relation to pay, which could be a legal equal pay issue? If so you are legally obliged to resolve these immediately.
  • Do your recruitment processes need reviewing? Are you advertising jobs as flexible working or offering skilled part-time roles that work for people with caring responsibilities, which are more likely to be women?
  • Finally, you need to create an action plan off the back of this analysis – this is not currently mandatory but Fawcett has argued that it should be, and we urge all employers to set out what they intend to do to close the gap.

As well as asking employers with over 250 people to published their gender pay gap, the new reporting regulations also require them to reveal their bonus pay gap. In some case this is shockingly high.

Commenting on bonus pay gaps, Sam said, “In many cases bonus pay gaps – some which are more than double the gender pay gap – simply cannot be justified. There will be women all over the country who are quite simply being cheated out of what they are entitled to or men who are being over-rewarded. This practice has to end.”

Key findings

As of 29 March 2018:

  • 6,533 employers had published data, of an expected 9,000.
  • 4,960 employers said that they paid a bonus last year.
  • Of those, 80 per cent of employers reported a mean gender pay gap in favour of men. 33 per cent reported a bonus pay gap of over 50 per cent in favour of men.
  • 45 companies have reported a 0 per cent gap on both median and mean averages. While it is possible that some of these may be legitimate, some may be incorrect reporting.
  • According to Annual Survey of Hours and Earnings data, collected by the ONS from a sample of PAYE data, the mean full-time gap is higher in the private sector, at 17.1 per cent – but it has fallen by 4.3 percentage points since 2011. In the public sector it has stayed flat at just above 14 per cent. Progress on closing the pay gap has stalled and not shifted in three years.
  • Some industrial sectors have much larger pay gaps, such as air transport with a 35.9 per cent gap, financial and insurance activities with a 32.8 per cent pay gap, the arts with a 36.5 per cent pay gap, and legal and accounting with a 23.8 per cent pay gap.

What if employers don’t publish their data?

At present not all of the approximately 9,000 organisations required to do so have published their data. Any company which does not publish by the deadline is acting against the law.

The Equality and Human Rights Commission (EHRC) has published and consulted on its initial strategy for enforcement of gender pay gap reporting. Using its existing enforcement powers under the Equality Act, this will include seeking summary convictions with an unlimited fine, but this will only be an option where an employer has been investigated, issued with an unlawful act notice and has still failed to comply. This is a disproportionately drawn out process.

Fawcett recommends that the law should be changed so that civil penalties for non-compliance are introduced, which along with additional resources for the EHRC would enable them to have a more immediate impact with enforcement activity. This would be a similar approach to the powers given to HMRC to enforce the National Minimum Wage.

* Fawcett Society https://www.fawcettsociety.org.uk/

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