News archive

CBI issues guide to gender pay gap reporting

28th February 2017

Produced in partnership with law firm CMS the CBI says that its guide, What your business needs to know about gender pay gap reporting offers practical advice on positioning your organisation on gender pay and step-by-step guidance on calculating and reporting your gender pay gap in line with statutory requirements. It suggests using the insights gained from analysing pay data to help inform what steps your organisation can take to improve gender diversity.

The CBI also notes that mandatory reporting of gender pay gaps was not a process CBI members supported, but says, nonetheless that the challenge of closing the gender pay gap requires action from businesses and the government alike. As well as self-evidently being the right thing to do, improving gender diversity at work increases the productivity of the UK economy as a whole, while also improving business’ access to skills, decision-making and staff engagement.

You can read the guide here.

Government fails to act on cross-party recommendations to reduce the gender pay gap

21st February 2017

The Government will fail to achieve its goal of eliminating the gender pay gap in a generation if it continues to ignore the evidence put before it, says a cross-party committee of MPs. The Women and Equalities Committee raises concerns that the Government is not effectively tackling the structural causes of the gender pay gap, as it publishes the Government’s response to its recommendations today. The Committee’s report and recommendations were published in March 2016 and received a Government response in January 2017.

The Committee is also launching a web forum today for stakeholders, including researchers, business-people and members of the public, to respond to the reasons given by the Government for not implementing the Committee’s recommendations.

New briefing on the gender pay gap in Scotland

To inform the recently announced inquiry into the gender pay gap in Scotland, the Scottish Parliament Information Centre (SPICE) has produced a briefing on the gender pay gap in Scotland. The briefing looks at data on pay by gender from this year’s Annual Survey of Hours and Earnings (ASHE) (ONS 2016a) produced by the Office for National Statistics (ONS).

Key points from the SPICE briefing are:

  • When comparing median or typical pay for all employees men make more money than women. The pay gap for all employees in Scotland is 15.6 per cent compared to 18.1 per cent in the UK.
  • The gender pay gap in Scotland for full time employees is 6.2 per cent, lower than the UK overall at 9.4 per cent.
  • Since 1997 the gender pay gap in Scotland for full-time employees has fallen from 18.4 per cent to 6.2 per cent.
  • Women are paid more than men for part-time work when comparing the median or typical pay.
  • When looking at median pay, women across most age groups are paid less than men. The pay gap increases for women over the age of 40. Between the ages of 30 and 39 women are paid more than men.
  • When looking at occupations, the largest pay gaps are found in skilled trades and management.

The briefing also suggests reasons for the differences between Scotland and the rest of the UK.

  • The top 10 per cent of earners in Scotland earn below the UK average for top earners. As the highest earners tend to be men this will contribute to the overall pay gap being lower. For example, London and the South East have the highest income for the top 10 per cent of earners and have the second and third highest pay gaps respectively.
  • Scotland has the second highest proportion of people who work in the public sector in the UK – as the pay gap in the private sector is higher than in the public sector the higher proportion of people working in the public sector will contribute to having a smaller pay gap.

You can read the full briefing here.

Last updated 6th April 2017
30th January 2017 Fawcett Review of Sex Discrimination and Equal Pay laws

The Fawcett Society has today launched a major review of the UK’s sex discrimination laws in response to the risk that long-established rights could be eroded or weakened as a result of Brexit and the UK leaving the EU single market. The review will also consider the effectiveness of the current laws and how best to balance the rights of the individual with the responsibilities of the organisation.

The review will be headed by Dame Laura Cox DBE a retired High Court Justice and co-ordinated by equality law expert Gay Moon. Panel members include a number of leading QCs and equality law experts. The review is set to last for approximately 9 months and will report in the autumn.

Sam Smethers, Chief Executive of the Fawcett Society said

“The Prime Minister has made the welcome commitment that she wants the UK to be a fairer place, that she will not only protect workers’ rights but build on them. We share that goal. We have an ambitious vision, to make the UK the best place to be a woman.”

“But to achieve that we need to create a legislative framework fit for the 21st century. One that genuinely protects the rights of the individual – rights that they can exercise by giving them access to justice – and promotes equality.

“The PM has also made clear that if necessary she will take the UK down a low tax low regulation path. That can only mean us turning the clock back on women’s rights and we cannot allow that to happen.”

The Review will consider the effectiveness of the law to date in addressing gender inequality, including access to justice. It will also identify gaps in protections for women and recommend how those gaps could be addressed. In particular, the following:

  • Employment law & discrimination including pregnancy discrimination, sexist dress codes, equal pay including pension provision
  • The application of the definition of indirect discrimination
  • Family friendly rights for parents and carers including possible consolidation
  • Harassment including on the internet and social media
  • Hate crime and its limits
  • Multiple discrimination, particularly intersectional discrimination and whether Section 14 of the Equality Act 2010 in its current form is sufficient
  • Public sector equality duty and specific duties
  • The balance of individual rights vs the responsibility of the organisation to promote equality

The Equality Act 2010 was largely an amalgamation of pre-existing equality legislation. Some of the newer provisions were not enacted at the time and have either only recently been enacted (Section 78) or are still awaiting commencement (e.g. Section 14: dual discrimination). There is also concern that individuals are unable to bring discrimination claims, deterred by Employment Tribunal fees and time limits.

Panel members are:

Dame Laura Cox DBE, Chair, Gay Moon, Lead and co-ordinator, Sam Smethers, Fawcett Society, Anna Beale, Cloisters,Rachel Crasnow QC, Cloisters, Daphne Romney QC, Cloisters, Louise Whitfield, DPG Law, Prof Aileen McColgan, KCL, Karon Monaghan QC, Matrix Law, Prof Colm O’Cinneide, UCL
Muriel Robison, Glasgow University, formerly EOC and EHRC, Matthew Creagh, TUC, Rachel Krys, EVAW,Wendy Hewitt, EHRC, Katie Woods, Maternity Action

Find out more about the Sex Discrimination Law Review and how you can submit evidence here.

 

30th January 2017 ACAS/GEO guidance on gender pay gap reporting issued

Acas and the Government Equalities Office have launched guidance to help larger businesses abide by new gender pay gap regulations, which come into force in April.

The new law requires large companies to take a salary snapshot of male and female employees and report on gender pay gaps within their organisations.

The gender pay gap reporting rule applies to an estimated 8,000 businesses and voluntary and charitable organisations in Great Britain with more than 250 employees and will allow managers to see differences in the average salary for men and women in their workplaces.

Acas Chief Executive Anne Sharp said:

“Compulsory gender pay reporting is fast approaching. The new requirement provides a great opportunity for organisations to look at the issue in depth and to consider whether they can do more to develop their talented women and secure the benefits of greater gender diversity at all levels.

“Our new guidance on gender pay reporting provides businesses with practical advice on how to carry out the calculations and on family friendly working to reduce the gap.”

Minister for Women, Equalities and Early Years, Caroline Dinenage said:

“No one should ever be held back just because of their gender. We now have the lowest gender pay gap on record, but we still have to push further.

“I encourage all employers to use this guidance, which will be an important and helpful tool for tackling the gender pay gap and promoting workplace equality.”

Gender pay reporting will affect more than 11 million employees across the UK. The guidance shows employers how to calculate the gender pay gap and what action to take to close it.

For more detail go to Gender Pay Gap Reporting.

18th January 2017 Ministry of Justice has discriminated against judges

On the 16th January 2016, the Employment Tribunal upheld the claims of over 200 judges for unlawful age, race and sex discrimination and equal pay against the Lord Chancellor and the Ministry of Justice in relation to changes made to their pension entitlements.

The Tribunal held that the Lord Chancellor and the Ministry of Justice had discriminated against younger judges, a significant number of whom were female and/or from minority ethnic groups, by requiring them to leave the Judicial Pension Scheme in April 2015 whilst allowing older judges to remain in that Scheme, and that this discrimination could not be justified.

The Tribunal found that the changes caused younger judges to suffer a disproportionate loss to their pensions purely because they were younger.

You can find the Tribunal decision here.

The decision could have ramifications for other public sector groups, such as police officers, teachers, firefighters and prison officers, who have been subjected to similar negative changes to their pensions.

The legal team were Shubha Banerjee and Chris Benson from Leigh Day and Andrew Short QC and Naomi Ling from Outer Temple Chambers. Shubha Banerjee said:

This is a great victory for our clients, many of whom sit alongside older judges who were appointed some years after them but who are, in effect, paid more purely because they are older.

“The fact that there is a significant number of female and BME judges in the younger group simply compounds the unfairness of the changes that were made to judicial pensions.

”According to Judicial Office Statistics, about one third of all judges in England and Wales last year were female, and only 7 per cent described themselves as from a black or other minority ethnic background.

16th January 2017 Fathers and the workplace

The Women and Equalities Committee has launched an inquiry into fathers and the workplace.

The inquiry follows on from the Committee’s report on the Gender Pay Gap in March 2016 which found that sharing care between fathers and mothers is the key to reducing the Gender Pay Gap.

You can find the inquiry’s terms of reference here

The committee is accepting written submissions until March 1, 2017.

9th December 2016 New Regulations, new online tool

Although the Regulations were actually available on line on Tuesday of this week, the Government has today announced that it has laid the draft Gender Pay Gap regulations before Parliament. The Government has also published its response to the Mandatory Gender Pay Gap Reporting Consultation on Draft Regulations for the private and voluntary sector.

The Government has carefully considered the responses to the second consultation and associated stakeholder engagement and considers that the draft regulations strike the right balance between being practical for employers to carry out, while ensuring the necessary level of transparency to accelerate change and encourage all employers to champion gender equality in their workforce.

In addition, the Government have also launched today a new online tool that allows the public to find out the gender pay gap for their occupation, as defined in the standard industrial classifications used by the Office for National Statistics. The online tool uses the latest data from the Annual Survey of Hours and Earnings to provide the most up to date gender pay gap data.  The launch of the online toll is in line with the Government’s intention that gender pay gap reporting should provide comparability with national statistics.

For more on the Regulations, go to Gender Pay Gap Reporting.

7th December 2016  Gender pay gap reporting

The new duty requiring big employers to publish data on their gender pay gaps will come into effect in April 2017 after revised Regulations were published today.

The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 apply to private- and voluntary-sector organisations with 250 or more employees.

Broadly similar rules for the public sector will be set out in due course.

Which employers are affected by the Regulations?

The Regulations for the private and voluntary sectors cover any employer with 250 or more “relevant” employees in England, Wales and Scotland (but not Northern Ireland) on 5 April 2017 – and on the same date each year after that.

In companies with a group structure, each legal entity will need to report its data. There is no legal requirement on smaller employers to report data, but they will be encouraged to do so.

How is an employee defined?

The Regulations apply the same definition of employee as the Equality Act 2010. This is a broad definition which includes zero hours’ workers, apprentices and partners in limited liability partnerships. Agency workers will be included in any reporting by the agency with which they have a contract of employment.

Employees will be covered by the Regulations if they are employed on 5 April, work mainly in England, Wales or Scotland, and are on full pay. Employees on reduced rates of pay while on maternity leave or sick leave are excluded.

Employers are not required to include data relating to an employee employed under a contract personally to do work, and the employer does not have, and it is not reasonably practicable for the employer to obtain the data.

How is pay defined?

Ordinary pay’ means basic pay; allowances; pay for piecework; pay for leave; and shift premium pay. It does not include overtime pay; redundancy pay; pay in lieu of leave, or non-monetary remuneration.

‘Bonus pay’ means pay in the form of money, vouchers, securities, securities options, or interests in securities; and pay that relates to profit sharing, productivity, performance, incentive or commission.

What data must be published?

Employers are required to publish six metrics:

  • The difference between the mean hourly rate of pay of male full-pay relevant employees and that of female full-pay relevant employees ( ‘the mean gender pay gap’);
  • The difference between the median the mean hourly rate of pay of male full-pay relevant employees and that of female full-pay relevant employees (‘the median gender pay gap’);
  • The difference between the mean bonus pay paid to male relevant employees and that of female relevant employees (‘the mean gender bonus gap’);
  • The difference between the median bonus pay paid to male relevant employees and that of female relevant employees (‘the median gender bonus gap’)
  • The proportions of male and female relevant employees who were paid bonus pay (‘the proportions of men and women getting a bonus’); and
  • The proportions of male and female relevant employees in the lower, lower middle, upper middle and upper quartile pay band (‘the proportion of men and women in each of four pay quartiles’).

Calculations for the pay gap metrics are to be based on a single pay period around the “snapshot date” of 5 April, while bonus gap metrics cover the whole year to April 2017. The Regulations provide detailed instructions on how the figures should be calculated.

What format should the report take?

The data required from employers must be published in English, by April 2018, on a company website that is accessible to employees and the public. The report must also be uploaded to a government website, which is currently under development.

There is no requirement to publish any accompanying narrative or commentary, but as many organisations will wish to explain what the figures mean, it is likely that the government website will allow space for a commentary.

The report must remain on the website for three years.

Who has to sign off the report?

The report must be accompanied by a written statement signed by a director vouching that the report is accurate, and it must remain on the website for three years.

Will there be additional guidance?

Acas is expected to publish guidance expanding on the core Regulations by the end of January 2017.

You can read the Regulations here.

27th October 2016 Gender pay gap narrows slightly

Provisional results from the Annual Survey of Hours and Earnings show that the gender pay gap (for median earnings) for full-time employees decreased to 9.4 per cent, down from 9.6 per cent in 2015. The Office for National Statistics, which publishes the survey, say that this is the lowest since the survey began in 1997, although they acknowledge that the gender pay gap has changed relatively little in recent years.

When part-time employees are included, the gap decreased from 19.3 per cent in 2015 to 18.1 per cent in 2016, the largest year-on-year drop since 2010. This is also the lowest gender pay gap since the survey began in 1997, when the gap for all employees was 27.5 per cent.

At the same time, the Office for National Statistics has published a table showing the gender pay gap for median hourly earnings (excluding overtime) by country, April 1997 to 2016. The table shows that the gap is wider in England than in Scotland, Wales, or Northern Ireland. While this has been heralded by the Scottish media as indicating the success of Holyrood’s employment policies, it is just as likely to be a result of the ‘City effect’ – it has long been known that the unusually high rates of pay in the City of London affect the national picture. In other words, rather than the gap being narrower in Scotland because women in Scotland earn more, it may well be that the gap is wider in England because of the exceptionally high salaries being paid to top earners in the city, most of whom are men.

For part-time employees separately, women are paid more on average, resulting in a “negative” gender pay gap. Although the part-time gender pay gap has decreased from minus 6.8 per cent in April 2015 to minus 6.0 per cent in April 2016, there is evidence that the part-time gender pay gap has widened in the long-term. The additional table shows that the inverse part-time gap is experienced by workers in all four nations. Should we be worried that men working part-time are experiencing a pay penalty? Possibly. Or possibly not.

Working part-time for a low wage may appear disadvantageous, but if it only lasts for a few weeks or a few months (as in the case of students, or people filling in a gap between full-time jobs)) then it may not turn out to be so. It’s when people get stuck in low-paid part-time work for years on end  at what should be a time of peak earnings that the impact becomes serious, but unfortunately the statistics don’t tell us anything about job tenure. Perhaps they should.

What we do know is that thanks to the introduction of the national living wage, Britain’s lowest-paid employees have received their biggest raise for nearly 20 years. The provisional figures show that low earners, part-timers, women and young people were the biggest winners over the past year. Pay at the fifth percentile (the wage below which the lowest-earning 5 per cent of workers were paid) was 6.2 per cent higher in April 2016 than a year earlier. This was the fastest annual increase for this group since records began in 1997. In contrast, pay for high earners at the 95th percentile rose 2.5 per cent.

You can read the provisional survey here and the additional table here.

 

15th October 2016  Asda workers can go ahead

The Manchester Employment Tribunal has ruled that lower paid women who work in Asda stores can compare themselves to higher paid men who work in Asda’s distribution centres.  The decision will allow over 7,000 store workers to proceed with their claims for equal pay against Asda in the UK’s largest ever private sector equal pay claim.

Law firm Leigh Day are currently representing former and current employees of the supermarket chain, mostly female, who feel they have been paid less than others within the organisation, despite carrying out roles of equal value. Leigh Day think that workers could recover over £100 million from Asda, going back to 2002.

Asda had initially tried to stop the claims from proceeding in the Employment Tribunal, arguing that they should be heard in the High Court, but the Court of Appeal ruled that the Employment Tribunal is the appropriate place for the women’s claims to proceed.

Leigh Day’s Lauren Lougheed, who represents the women said:

This is a dramatic victory for the workers we represent. Asda tried to argue that because the shops and distribution centres were in different locations, with different pay arrangements, that Asda could pay the men what they like.

“However, the employment tribunal found that Asda, the employer of both men and women, could have made sure that there was equal pay between men and women if they wanted to, but chose not to.

“This judgment will have far reaching implications on other supermarket equal pay claims including those we are bringing on behalf of around 400 Sainsbury’s workers who are in a similar situation.”

15th October 2016   TUC research

A new analysis of official statistics from the TUC shows that while women earn less than men annually at every stage in their careers, the gender pay gap is at its widest when a woman hits 50. She will earn £85,040 less over the course of this decade than a full-time man.

The gender pay gap begins as soon as women start their careers – an 18-year-old woman working full-time earns on average £1,395 a year less than her male peers. This increases steadily through her 20s, when a woman earns on average £1,944 less a year than men of a similar age, and 30s, when the annual pay gap hits £3,034 – meaning a 30-year-old woman loses £30,340 over the next decade.

The gap in annual earnings more than doubles when women enter their 40s, leaping up from £3,034 to £7,234 a year – or £72,340 over the decade of her 40s. The TUC believes this reflects the different impact of parenthood on women’s and men’s earnings. TUC research published earlier this year found that at age 42 (the midpoint of a typical working life) the pay gap between mums and dads in full-time work was 42 per cent. For childless men and women in their early 40s, it was 12 per cent.

The mothers who were least likely to experience a motherhood pay penalty were those who had children later in life when they were more senior; they also returned to full-time work soon after having children.

The pay gap widens further for women in their 50s, hitting £8,504 a year, or £85,040 through the decade, as caring responsibilities – including for older relatives – continue to have an impact.

TUC General Secretary Frances O’Grady said:

“Women suffer a huge pay penalty over the course of their careers, which peaks in their 50s. At current rates of progress it will take decades for women to achieve pay parity with men.

Having children has starkly different effects on men’s and women’s pay, with women earning less after having kids, and men earning more. Far more needs to be done to help mums get back into decent, well-paid jobs after they have kids – and to encourage dads to take on their share of caring responsibilities.

Workplaces with union coverage are more likely to have family friendly policies. So a good first step for women worried about their pay is to join a union.”

The TUC has calculated that at its current rate it will take nearly half a century to achieve pay parity between women and men.

The TUC wants to see the following action to help close the gender pay gap:

  • Support for more equal parenting roles to stop women being held back at work: Better paid, specific leave for dads would encourage them to play more of a role at home and share caring responsibilities with mums from as soon as a child is born.
  • More done to address excessive working hours in full-time jobs:This would allow mothers who want to work full-time to do so – and would also ensure that fathers can play more of a role at home.
  • Better support for women when they become mothers:Better opportunities to work flexibly or work reduced hours and more support for women returners would help more mums back into well-paid work.
  • More done to ensure women are not overlooked for training or promotion opportunities once they have children: Employers also need to ensure that these opportunities are not designed in a way that excludes those with caring responsibilities.
  • Better pay gap reporting: Gender pay gap reporting is due to begin for large employers in 2018. The law should be strengthened so that employers also have to publish an action plan for narrowing the gender pay gap in their workplace. There should also be proper sanctions for employers who refuse to publish this information.
30th September 2016  McKinsey, The Power of Parity

For the past ten years, the McKinsey Global Institute (MGI) has been researching and writing about gender and diversity. McKinsey’s Women Matter research has explored the role women play in workplaces around the world, including in the UK.

The Power of Parity, advancing women’s equality in the United Kingdom argues that narrowing the UK gender gap in work could create an extra £150 billion on top of business-as-usual GDP forecasts in 2025, and an additional 840,000 female employees.

Of the indicators MGI examined, gender parity across social metrics is mixed, with UK women enjoying parity in higher education and in legal protection, but with other social indicators revealing a less positive picture. The highest disparity is in single parenthood. In addition, UK women spend almost twice as much time as men on unpaid care work.

The report also finds that while the UK has little gender inequality during childhood, once a woman reaches young adulthood, factors such as the UK’s relatively high prevalence of teenage pregnancy may limit her ability to enter the workforce; when coupled with low income mobility, this can restrict her future economic contribution. Gender-based violence may also impact some women during this phase, with possible ramifications for educational attainment and, later, labour-force participation.

Within the workplace, MGI’s data suggest that labour-force participation rate, hours worked, and median wage have all remained within the medium inequality range, while the women in leadership and managerial positions indicator continues to demonstrate high inequality.

You can find links to both the executive summary and the full report here.

Last updated 17th February 2017