21st November 2016
Equal Pay Day 2016: Cracks in the glass ceiling
This year, “Equal Pay Day” conspicuously fell on 10 November 2016. In case you missed it (amidst the hullabaloo of a shock US election result perhaps) Equal Pay Day is the day that women could effectively work for free until the end of the year as a consequence of earning 13.9% less on average than men.
In 2015, the then Prime Minister, David Cameron, declared that the government would "end the gender pay gap in a generation". This announcement is nothing but ambitious. On current trends, it will take another 62 years to eradicate. The disparity in pay between men and women has a number of causes, however, it is generally accepted that childcare responsibilities and discrimination in the workplace due to pregnancy or maternity leave are among the most prevalent. Women often take steps to put their careers on hold to look after children or search for part-time work. Women also face challenges when attempting to return to work after giving birth, either by being manoeuvred out of their jobs or finding themselves further away from promotion opportunities because they have been out of the business for a period of time. Those who seek flexible or part-time working arrangements often find themselves disadvantaged compared with their male counterparts who can work full-time; a recent study by Timewise found that 6% of roles with a wage of £20,000+ were available with flexible working arrangements, contrasted to just 2% of jobs with a salary of £100,000+.
What is the law?
The Equality Act 2010 (the “EqA”) prohibits differences in pay between men and women who carry out work of a similar kind. In a growing effort to tackle the pay gap the government is introducing mandatory pay gap reporting for large companies. This means that employers with 250 or more employees will be required to publish gender pay gaps across their businesses. In addition, in order to level the playing field on childcare commitments, Shared Parental Leave is a relatively new introduction to employment rights, allowing parents to share nearly a year of leave from work.
The first mandatory gender pay gap reports will be due by April 2018 by virtue of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2016.
The recent attacks on the gender pay gap have been easily critiqued as not being bullish enough. For instance, might larger employers take more active steps to comply with the rules if there were penalties for those who misreport or don’t comply? Indeed, what about a woman who has the misfortune to work for an employer with less than 250 employees. It appears, for now at least, she will find herself marginalised. The EqA does make secrecy clauses in employment contracts unenforceable when an employee seeks a disclosure on an equal pay concern, so if a woman feels that she is paid less than a man in a similar role she has the right to disclosure from her employer. Failing which she can raise a formal grievance if unsatisfied with her employer’s response.
Readers should note that the introduction of employment tribunal fees in 2013 has seen a stark reduction of discrimination claims related to equal pay. The Ministry of Justice is undertaking a review of tribunal fees and if they conclude that reform is necessary, it is likely that the fees could be removed or substantially reduced. Women will then have more access to justice and their employers will not have a safe haven of knowing many of their employees will be priced out of taking action.
Employers who are progressive in combating gender disparity within the workforce stand to benefit, not only in a legal sense (by not opening themselves up to potential employment claims) but from a business perspective with the competitive advantage of more diverse teams and female leaders.
If you have any queries on equal pay or the new gender pay reporting regulations or any other area of employment law please contact our employment solicitors Daniel Stander or Deborah Scales on 0808 168 5550 or email us on firstname.lastname@example.org.