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Government planning gender pay gap league tables

February 18, 2016  /   No Comments

Nick Elvin

The Government has released details of its plans to force companies with over 250 employees to publish their gender pay gap data.

Companies that are failing to address the pay gap will be highlighted in new league tables as part of plans unveiled by Women and Equalities Minister Nicky Morgan, while the Government says it is also taking action to make sure that thousands more girls are studying STEM (science, technology, engineering and maths) subjects at school.

In addition to publishing their average gender pay gap and bonus pay gap, firms will have to publish the number of men and women in each pay range. Each employer would also have to publish their gender pay gap on their website, and make a report of the figures each year, which senior executives will have to sign off.

Firms will have to begin calculating their pay gap in April 2017, ahead of the first official publication of the league tables, planned for 2018.

Nicky Morgan said: “In recent years we’ve seen the best employers make ground breaking strides in tackling gender inequality. But the job won’t be complete until we see the talents of women and men recognised equally and fairly in every workplace.

“That’s why I am announcing a raft of measures to support women in their careers from the classroom to the boardroom, leaving nowhere for gender inequality to hide. At the same time I’m calling on women across Britain to use their position as employees and consumers to demand more from businesses, ensuring their talents are given the recognition and reward they deserve.”

Responding to the announcement on gender pay reporting, Dianah Worman, diversity adviser at the CIPD, said: “We welcome the additional reporting proposals set out by the minister. These will give a more insightful picture of the gender pay gap in organisations than the use of an average figure – both are both simple and practical. But narrative reporting is needed to set the numbers in context; organisations have different legacies, challenges and opportunities to deal with, and this should be taken into account.

“We are, however, concerned about the use of league tables across economic sectors to highlight problems. This will likely draw the attention of women to the lower earnings potential they will have to face in forging a career in the STEM areas, where they are already seriously under-represented. It could disincentivise women from exploring opportunities in the very areas government wants to see more women working, in order to remove the gender pay gap.

“Also, the use of naming and shaming as a sanction against organisations for failing to report what they find could also hinder meaningful and sustainable change. It might encourage quick fixes which could be inaccurate reflections of real progress.”

Graham Trevor, UK HR director at global recruitment company Randstad said: “In an age of radical transparency, brought about by social media and other emerging technologies, the gender pay gap was always on borrowed time. For certain companies in more conservative or male-dominated sectors, there’s no doubt the new rules will be a major shock. In the medium to long term, companies will see the cultural and commercial benefit of gender pay equality.

“In our experience, companies that attract and hire people in a gender-neutral way attract the very best talent, which is what any company wants, wherever in the UK it is and whatever it does. Companies that fully embrace the change will be far better positioned for success than those that don’t.”

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