It's been nearly 50 years since the government introduced the Equal Pay Act, so why is it still lagging behind the private sector in addressing gender pay equality?
This article was first published in the March 2017 UK edition of Accounting and Business magazine.
Public bodies have often led the private sector when it comes to progressive employment practices. But it is different with gender pay reporting – the government demanded that others got their houses in order first. Gender pay gap reporting was introduced for large private and voluntary sector organisations in Great Britain in October last year.
The move has been widely welcomed. ‘This is an important milestone on the journey towards greater gender parity at all levels within large UK businesses,’ says Emma Codd, managing partner for talent at Deloitte UK. ‘Being able to access information about the gender pay gap will enable people to make better-informed decisions about potential future employers, and will also allow companies to consider gender pay data when selecting suppliers and partners.’
Codd adds that without more effective action to tackle gender pay disparity, pay equality will not be reached until 2069.
The government has accepted that ‘it is only fair in that what we ask of business we should expect of ourselves’, as minister for women and equalities (and secretary of state for education) Justine Greening explained at the end of last year. Under new proposals, large public bodies will have to begin recording gender pay information in April this year and publish the data before April next year.
‘It is another positive step in improving diversity, and specifically the gender pay gap, that the government is widening out the remit of the gender pay regulations to include the public sector,’ comments PwC partner Ed Stacey. ‘While the pay gap in the private sector remains ahead of that in the public, there is still significant room for improvement across both. The publication of pay gaps will be a good means to help address that challenge.
‘At PwC, publishing our gender pay gap has allowed us to understand the reasons for the gap and hold ourselves accountable to make changes. For example, we know that a sizeable part of our pay gap is a result of having fewer women in senior positions, so this is an area where we continue to focus our efforts. We’re also challenging our recruitment processes, making more senior jobs available as flexible or part-time and have introduced a return-to-work programme.
‘In our experience there is no silver bullet and the gender pay gap is just one data point that organisations should be tracking as part of their overall efforts to create a workplace that works for all.’
The move towards pay gap reporting has been strongly endorsed by the public sector trade unions – although they are calling for it to be supported by additional actions. The union Unison represents workers in local government and the NHS. Its national women’s officer Sharon Greene says: ‘Unfair treatment of women over pay is still a major source of inequality in the UK. The government’s proposals will go some way to highlighting this discrimination in the public sector, but monitoring alone won’t solve the problem. What’s needed is greater access to childcare and more high-quality part-time jobs to ensure women earn the same as men.’
Civil service support
A spokesman for the civil service Public and Commercial Services Union adds: ‘We support any effort to close the gender pay gap. One way to tackle it in the civil service would be to restore national negotiations on pay, instead of relying on more than 200 sets of talks across government departments and agencies, which is wasteful, time-consuming and causes massive inequalities.’
Su Maddock is visiting professor at the University of the West of England and a former director of the Whitehall Innovation Hub, who has taken a close interest in gender equality over many years. She argues that gender pay reform is taking too long. ‘Pay inequality is lower in the public than the private sector, at 18.5% and 25.3% respectively,’ she says. ‘The culture is clearly changing across employment sectors, with the gender pay gap as a whole falling – but very slowly.’
Maddock points out that despite the introduction of the Equal Pay Act 47 years ago, women still earn less than men, especially for jobs where women dominate the workforce, such as in child care, social care, etc. The gender pay gap is now 13.9% across the UK. The situation is much worse at either end of the pay spectrum. At the top, only 5% of FTSE 100 CEOs are women. By contrast at the bottom-end, 60% of low-paid workers are women. As the economy becomes more and more fragmented, the gap between the low paid and wealthy increases, disproportionately affecting women.
Why have we been so poor at valuing women at work? Maddock again: ‘Gender audits have tended to ignore the influence of male work cultures, which influence management’s decisions about job criteria, pay and performance assessment – all of which are dependent on value judgments about who is worth more. Age-old gender stereotypes demote women’s contributions to and at work.
The Equal Pay Act was supposed to remedy this. However, says Maddock, ‘while some individual employers may pay individual women managers more, the cost of paying a group of women workers more really impacts on budgets as many local authorities have found after regrading cases. The gender pay gap demands a political debate and reframing of economic value.
‘As the low-wage economy takes root as the UK’s economic model after Brexit, the economy will become even more dependent on wealth creation, smart technologies and financial innovation, where manufacturing becomes a specialist activity and jobs move from manufacturing to warehousing and robots. The political voice for revaluing human skills, human care and social capacities could move closer to centre-stage than anticipated.’
Paul Gosling, journalist
"The proposals will go some way to highlighting discrimination in the public sector, but monitoring alone won’t solve the problem"