Legislation coming into force this week as a result of last year’s Employment Act could have a significant cultural impact on companies who are secretive about their pay structures, according to Mercer Human Resource Consulting.
The consulting firm says that organisations who currently do not make their salary set-up clear to employees are likely to find themselves challenged by employees who feel they are currently subject to unfair conditions of pay to reveal information about other employees’ pay levels through the new equal pay questionnaire procedures. Although employers do not have a statutory obligation to provide answers to the questionnaire, by refusing to answer any employment tribunal dealing with an equal pay case will be in its rights to assume the company is not operating a fair pay structure.
Gary Bowker, Employment Law Consultant at Mercer, said: “Secrecy around pay is one of the biggest obstacles for women who believe they have been discriminated against. Talking about pay – who gets how much and why – has long been a workplace taboo.”
He added: “The new procedure should not pose any threat to employers who have fair and transparent pay systems in place. But employers with opaque pay structures may be in for a shock, and could face a high risk of successful claims for equal pay.”