On the 40th anniversary of the Equal Pay Act, the Equality and Human Rights Commission has called on organisations to do more to close the pay gap between male and female employees.
When the Equal Pay Act was introduced in 1970, it was heralded as a major advance for women in the workforce. However, despite advances over the past 40 years, in some areas the pay gap between men and women remains, with women working full time still being paid on average 16.4 per cent less than men*.
In some sectors, the pay gap is significantly higher. The Commission’s recent inquiry into the finance sector found that women working full-time earn up to 55 per cent less annual average gross salary than their male colleagues. It also revealed that men in some of the sector’s biggest employers receive five times the performance pay of women.
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The Commission’s research found a number of causes of the persistent gap. These include stereotyping about women’s capabilities and skills, women bearing the brunt of caring responsibilities, and discrimination in pay systems.
For businesses which do link equal work to equal pay, the rewards are well documented and include a boost in workplace productivity and a good business reputation. It has also been estimated by the Women and Work Commission that improving women’s participation in the labour force is worth between £15 billion and £23 billion to the British economy each year.
The Commission believes that employers should take it upon themselves to do what they can to bring pay equality to their workforce.
Quoted on the Equality & Human Rights Commission website, Commissioner Jean Irvine said:
“Employers need pay systems that are both transparent and fair. While transparency is not enough of itself to reduce the gap it does provide clarity; it is difficult, if not impossible, to resolve a problem that cannot be seen.
“Most employers should be able to measure their own pay gap, particularly those with combined payroll and human resource systems. They should also be able to take steps to resolve it including offering flexible parental leave.
“The Commission will shortly be issuing guidance to help businesses measure and address pay gaps. However, we have made it clear that when the voluntary approach fails, we will use our enforcement powers to address any persistent and significant problems.”
