A piece in today’s Times:
Companies face unlimited fines over the gender pay gap as British employers were found to be paying men as much as five times more than women.
As a thousand bosses scrambled yesterday to meet a government deadline to provide staff pay details, Baroness Williams of Trafford, the equalities minister, warned companies that failed to produce a plan to reduce the pay gap about “unlimited fines”.
Last night about 10,000 employers had submitted figures as part of the government’s biggest exercise to determine the size of the pay gap, with at least 1,200 waiting until yesterday to submit data. Employers with more than 250 employees had until midnight to publish figures on the average pay of female staff compared with the average pay of male staff during 2017-18, using several data points.
The government was expecting 9,000 employers, from public and private sectors, to submit their data. Some 238 employers with fewer than 250 employees also submitted details.
The figures suggested that the gender pay gap may be lower than thought. Of 9,644 companies that had reported by yesterday afternoon, the average gender pay gap based on median hourly figures was 9.8 per cent (the percentage by which women are paid less than men). Last year official figures suggested that the median gap was 18.4 per cent, although this was based on a sample of individuals with no restriction on company size.
Companies were also asked for mean hourly earnings figures, which revealed an average pay gap of 14.5 per cent for those with 250 or more employees.
The Equality and Human Rights Commission (EHRC) will take action against companies that fail to submit their data — a requirement under the 2010 Equalities Act — or that fail to take action to reduce the gap. Companies were told to produce an action plan to achieve parity.
Yesterday Theresa May pledged to tackle the “burning injustice” of the gender pay gap. She wrote in The Daily Telegraph that “major injustices still hold too many women back”.
Government guidelines encourage employers to recruit in different ways; design jobs to be flexible; pay for work done rather than time in the office; increase pay for shared parental leave; introduce annual equal pay audits and sponsor career development.
Rebecca Hilsenrath, chief executive of the EHRC, said: “Targets will help employers track the progress they are making and put clear actions in place to achieve results.”
A wealth management fund, Hargreave Hale, was paying women 19p for every £1 a man earned, making women’s mean hourly rate 81.3 per cent lower than men’s. Coast, a fashion chain, was paying women 71 per cent less than men.
About nine in ten employers have a gender pay gap, analysis by The Timessuggests. The gap was worst in finance, at 26.6 per cent. Next was construction, at 21.3 per cent, and then arts, entertainment and recreation, at 19 per cent.
The industry with the lowest pay gap appeared to be transport, at 10 per cent. Aslef, the train drivers’ union, said that for train drivers, the gap was 0.7 per cent.
The 1,200 or so employers with no pay gap, or one that was in favour of women, included Mars, the food company, where women earned £1.52 for every £1 that men earned.
The gender pay gap is an issue across the world and it is getting worse (Tom Knowles writes).
In November last year the World Economic Forum said that when it came to earnings there hadn’t been “any real improvement over the last ten years and now things are moving in the wrong direction”. Last year the average annual earnings of women across the world was $12,000 but for men it was $21,000. At the current rate of change, the gap between men and women will not close for another 217 years.
A key issue in many European countries is the cultural and institutional treatment of women who have children. In Germany, which has Europe’s lowest share of families where both parents work full time, the pay gap is 21 per cent, significantly higher than the EU average of 16.2 per cent.
Iceland, which the forum has rated the most gender-equal country in the world, is the first to legally enforce equal pay. Within four years any company employing more than 25 people that does not pay equal wages for work of equal value will face daily fines. Meanwhile in Sweden there is a “daddy quota” of 90 days’ parental leave allocated solely to fathers. If the father does not take the time off work then the couple lose three months’ paid leave.
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