On the 14th July, the Government launched a consultation on the implementation of gender pay gap, 'Closing the Gender Pay Gap'. This gender pay gap consultation is important for a number of reasons.
Section 78 of the Equality Act 2010 contains a power for the government to require private and third sector employers with more than 250 employees to publish information relating to the differences in pay between male and female employees.
Guidance on the "Think, Act, Report" framework has also been re-published. This is aimed at encouraging voluntary action by employers to identify, and act transparently to address gender pay gap issues.
Chapters 1, 2 and 4 of the consultation paper contain information about the gender pay gap, its causes, the progress that has been made so far, and ongoing work in this area. This includes Lord Davies work on increasing gender diversity on company boards, and on the "Think, Act, Report" initiative to encourage companies to be more transparent over their gender pay gap. Although the consultation paper presents "Think, Act, Report" as a successful strategy, with over 280 businesses (employing 2.5 million people) having signed up, in reality very few of those companies have actually published their gender pay.
The matters on which views are sought in the gender pay gap consultation include:
- Whether publication of gender pay data will encourage employers to take action to close the pay gap
- Whether the regulations should specify where the gender pay gap figures are to be published
- How frequently the gender pay gap figures should be reported
- The cost to employers of producing the data, how they can be supported, and whether there are less costly ways of increasing gender pay transparency; and
- Whether the threshold of 250 employees is appropriate
It is estimated that women working part-time earn 32% less than their male counterparts, making this consultation surprisingly still relevant in 2015.
Ensuring that pay systems are fair also mitigates the risks of claims being taken against businesses. Tribunals in Scotland can award up to five years back pay, plus interest, to men and women who bring successful equal pay claims. The damage caused to the reputation of a business by a tribunal loss is difficult to measure.
The consultation can be found here - https://www.gov.uk/government/consultations/closing-the-gender-pay-gap and is open until the 6 September 2015 should you wish to respond.
