From 2018, the Government will introduce new league tables naming and shaming companies with over 250 employees that are failing to address the gender pay gap.

Gill Smith, Employment Law Consultant at Moorepay, discusses the impact of the legislation to UK businesses, and how they can prepare.

Would you pay more for a pink product? If it looks the same, feels the same and does the same, why pay more?

Recent research found that women will pay more than men for almost identical items across the high street. “Female” razors and “for her pens” where found to be priced higher than the male equivalents just for being pink.With such sex discrimination displayed across the high street it is no surprise to still see pay gaps within the workplace.  The latest figures suggest that women in the UK still earn on average 20% less than men.

Equal pay for equal work legislation was put into place in the 1970s, three decades ago, following a public outcry in support of the female machinists at fords in Dagenham. The machinists walked out in protest that they were paid sufficiently less than their male colleagues who worked on the same production site.  

Last week, David Cameron pledged to eliminate the gender pay gap "within a generation". By 2018, all companies with over 250 employees will need to publish the average pay of male and female employees and the number of men and women in each pay range to show where pay gaps are at their widest.By publishing a league table of firms, naming and shaming the worst offenders, employers will be forced to address the differences within their organisations

Paying a flat rate could still create a pay gap

Many businesses are surprised to find that they have a gender pay gap. They often pay all employees at the same level a flat rate of pay – but when they look at the overall figures, men are showed to be the higher earners.   

Recently, one of our clients was surprised to have an equal pay challenge form one of their care workers. The care worker claimed that men were paid more than women in the organisation. The team leader and junior management roles were dominated by men whereas the care workers were mainly dominated by women who were paid the minimum wage.

When we explored this further, we found that all team leader or junior management roles were full time positions.This indirectly discriminated against female employees as they tend to want part time hours due to child care commitments.There was no reason why such middle management roles could not be done on a part time basis to encourage applications from their female workers.

How to prepare for the new legislation

In preparation for the legislation you need to be aware of any pay gap differences within your organisation. Here are some questions you should ask yourself to help analyse your company data:

·      What is the average pay for men’ against women employees across the work force?

·      If there are any gaps, are they at shop-floor level – Junior, middle management or among senior leaders?

·      Are starting salaries for men different form starting salaries for women?  Men often negotiate higher starting salaries.

·      Do you have flexible working practice available to support all parents and carers?

The final regulations are set to come into force in October 2016, with the first mandatory reports due in 2017, which means that every affected business should be taking action now.

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