The Equality bill – why it doesn’t measure up

Why do we still have such a gaping gender pay gap of 17% for full-time workers and 37% for part-time workers?

A key reason is weak legislation and the Equality Bill, currently moving through Parliament, is a prime opportunity to tackle this but it’s still falling short of the mark. So what needs to change?

 

Problem – The burden is on employees not employers
The current law does not force employers to comply with equal pay laws unless an individual brings a claim against them. Employers therefore often fail to even consider the problem, let alone prevent it or resolve it, and it is left up to the individual to take them to court.

What the bill proposes:
Clause 73 of the Equality Bill requires companies with more than 250 employees to voluntarily report on pay, and this will only be legally enforceable from 2013 if the voluntary approach hasn’t worked.

Solution:
Making it compulsory for all employers to conduct audits and produce action plans to address any differences between men and women in similar roles would be far more effective and make companies address and eliminate their unfair practices. So far, only 17% of all private firms have carried out a pay audit on their own initiative. Clearly the voluntary approach has not worked and needs to be abolished without being delayed until 2012.

 

Problem – How do you know if you’re a victim?
So, an individual has to bring a claim – but even finding out if you are being paid less than a male colleague can be a struggle. Often companies ban employees from discussing pay or bonuses in their contracts. And how does an employee figure out if any differences are actually caused by gender discrimination or by other factors?

What the bill proposes:
Clause 72 prevents employers from “gagging” employees ie, banning them from discussing pay in order to find out if there is a difference caused by a “protected characteristic”.

Solution:
The ban on” gagging” does not go far enough: employees are not legally compelled to share this information with one another if asked. It’s also unlikely that an individual would be able to properly work out whether the difference is due to discrimination or caused by other factors. Again, such a lack of transparency would only be properly addressed by an equal pay review carried out by the employer, which is more likely to have the resources, information and capacity to carry out a full job evaluation.

 

Problem – A minority of private sector employees are covered by audits
Only 41% of employees in the UK will be affected by the legislation on equal pay audits, which only applies to those working in the private sector in larger businesses.

What the bill proposes:
Clause 73 requires firms with more than 250 employees to report on their gender pay gap. Yet 59% of the private workforce are in firms that have fewer than 250 employees – completely unreachable under the current bill.

Solution:
Mandatory equal pay audits for ALL private sector employers in the UK should be compulsory.

 

Problem – Bringing a claim
If an employee does discover they are a victim of pay discrimination, they alone must take the employer to court – a process that is extremely costly and time consuming, with some cases taking up to 10 years to win. It also makes an employee more vulnerable to further victimisation. If there are female colleagues in the same workplace facing the same discrimination, they each have to bring their own claim. This only adds to the backlog of tens of thousands of equal pay claims currently moving through the system.

What the bill proposes:
The bill does not allow for representative action but this is currently being considered for employment tribunals.

Solution:
Fawcett is calling for representative action to be allowed – where bodies such as the EHRC, unions or employment bodies can bring a claim on behalf of an identifiable group of people, therefore providing the financial support and, if successful, bringing swifter justice to a group of victims simultaneously.

 

Problem – Finding a “comparator”
No other UK discrimination law requires you to find an “actual comparator” when proving discrimination ie, an actual male colleague in the same job being paid at a higher rate. Yet that’s the high hurdle you have to jump to protect your right to equal pay and it is particularly difficult if you are working in a female-dominated sector.

What the bill says:
The remedies set out in clause 61 and 62 only apply to those with an actual comparator.

Solution:
Allow women to point to a hypothetical male comparator in equal pay claims, in line with other discrimination law.

 

Problem – Tribunals lack power to assist wider workforce
Employment tribunals are limited in what they can do to combat wider, systematic discrimination in the workplace and can only rule on the individual cases. Since 70% of people have already left their employer by the time they bring their case to court it is even more difficult for tribunals to make any recommendations to the employer.

What the bill says:
Tribunals will be able to make non-binding recommendations to employers in discrimination claims, except for equal pay claims.

Solution:
Bring equal pay in line with other types of discrimination and allow tribunals to make binding recommendations (i.e. if they aren’t complied with employers are fined) in ALL types of discrimination cases.

 

The gender pay gap isn’t inevitable. But current and proposed equal pay law is too weak to tackle it. Equal Pay Day 2009 is our opportunity to change that.

 

Breaking the mould – gender stereotyping

The problem: occupational segregation
The gender pay gap is caused by a range of factors, which can be categorised as either direct discrimination, where women are directly being paid less to do work of equal value or skill than their male counterparts (40%), or indirect discrimination, where more complex factors contribute to the difference in pay. One example of indirect discrimination is occupational segregation where women or men are concentrated in certain jobs. In turn, there is a tendency for female-dominated to be lower-paid, regardless of the skill level required. An example of a typically female-dominated job being paid, or valued, less than that of an equal or lower-skilled job is that people pay more to have their cars looked after than their children. Speech therapists (99% of whom are women) are paid less than clinical psychologists (the majority of whom are male) – an issue that was successfully challenged in the European courts in Enderby v Frenchay Health Authority.

Such a trend can also be seen with graduates. Although women make up the majority of graduates (59%) the areas of study they are concentrated in tend to be less well-paid industries, with men dominating in the more lucrative sectors, for example information technology, mathematics, science and engineering.

First impressions last – giving the right careers advice
A recent report by the Women and Work Commission highlighted the problem of gender-biased careers advice being given to schoolchildren under the age of 14, encouraging girls to try work experience placements or take up work in traditionally female areas of employment such as clerical and caring work and leading to girls being less likely to choose a “typically” male career. In the report, “Break gender stereotypes, give talent a chance!” the Commission called for children to be encouraged to find work most suited to their skills not gender, therefore allowing a fairer distribution of skills and talent across the economy.

The more segregation, the larger the pay gap
Statistics show that in countries where there is a high level of occupational segregation, there is higher overall pay inequality. Examining the gender pay gap within each sector itself is even more illuminating, with the largest gender pay gaps occurring within the sectors that are traditionally male-dominated, such as financial services, manufacturing and business services. In such sectors there is often a big difference between pay levels at the top and bottom of the pay scale, with men concentrated in the higher up positions.

Assessing value
So, although important, reducing job segregation is only part of the solution. Properly recognising the value of typically “female” jobs is also vital to closing the pay gap, and to ensuring that within all sectors, equal opportunity allows employees to rise to the higher ranks based on their abilities alone. Women dominate in the areas of health, education and the civil service – all vital roles but not among the higher-paid professions. Therefore it’s time that such sectors were remunerated in a way which fairly reflects the skills required for such positions, equal to other positions with similar skills.

See also the Fawcett report

Just below the surface: gender stereotyping, the silent barrier to equality in the modern workplace?

And our case study on Sweden’s example

Parental leave – room for improvement

Fathers have just as much right to be involved in caring for their children as mothers, and it seems the government is finally starting to recognise this through its newly announced paternity leave measures. But do the changes go far enough?

From April 2010, under its new parental leave ‘sharing’ measures, men will be able to enjoy an equal amount of parental leave as women after the birth of their children. After the first six months of leave for the mother, fathers can then ‘takeover’ take six months’ leave, allowing the mother to return to work and continue earning. Either that or the mother can choose to stay off for the rest of the year.

This will hopefully allow more women to share the financial burden of childcare responsibilities and lessen the impact that having a family has on the gender gap in earnings. Such flexibility will significantly improve the ability of women to make freer choices regarding their career and when deciding if, or when, to start a family.

Not only will it allow men to become more involved in their child’s upbringing but it also reduces gender stereotypes about men and women’s roles, including, of course, within the workplace.

But although the measures encourage women back into work, they still do not provide fully equal parental leave during the first six months of the child’s life. Previous proposals announce by the government to extend maternity leave to 12 months and introduce paternity leave for the first 6 months have been shelved.

See also:
New paternity rights do not address take-up or gender pay gap

Sweden – setting an example

Sweden has one of the highest levels of gender equality in the world. Despite continuing to experience  occupational segregation in its labour market (although it’s slowly declining), Sweden has managed to tackle some of the inequalities created by pay disparities both between, and within, employment sectors by introducing stronger legislation. So how has it done this?

Reporting on pay
The Act on Equality Between Men and Women, so-called “proactive” legislation,  that requires all employers to report annually on the gender statistics of their employees (however individuals’ pay information is still protected by privacy laws), which is then presented to trade unions. Such reports allow unions to take into account not only data regarding pay between employees in the same position but also across sectors, and generally it has increased transparency across the country. Not only that  – all firms with over 10 members of staff must draw up an action plan as to how they will achieve equal wages and equal opportunities for all of their staff.

In addition, employers are legally required to carry out a review of an employee’s salary once they have returned from full-time parental leave, as traditionally returners are notoriously less well-paid than colleagues who have not had time off.

Defining “equal value”
Often equal pay cases brought before the courts have failed when trying to establish that a position is of “equal value”. However, in 2004 the government decided to review the Equal Opportunities Act which redefined the term, “work of equal value”. Up until now it has often been argued that wages are higher for a man in a private-sector post (particularly relevant since most male-dominated positions are in the private sector ) compared to a public sector post, because it has a higher market value, with the result that male-dominated career are judged as having a higher market value.  Such evaluation has been termed “value discrimination” and is an issue that is being challenged in the courts.

See also

Equal Opportunities: Sweden paves the way, by Karin Alfredsson
and
www.eurofound.europa.eu

Will the Equality Bill deliver for women? Lynne Featherstone says no

Below is a transcript of Lynne Featherstone MP’s speech at the fringe event organised by Fawcett and UNISON on ‘The Equality Bill – will it deliver for women?’ at the Liberal Democrats Party Conference in Bournemouth on 22nd September 2009.

“Will it deliver for woman? No! Not on your nelly! Women are the losers from the lost opportunity of the Equality Bill.

“This was literally a once in a lifetime chance to make a step change in women’s lives – but instead of taking the opportunity – perhaps the last opportunity a whole generation of Labour politicians will have to wield Parliamentary power – they’ve run scared of anyone who says “boo”, condemning women to hideously unequal pay for another generation.

“A small, very, very, small bit of good crept through on women’s pay – stopping employers from banning staff from talking about their pay – ending finally those bans that let discriminatory pay, wasteful pay be hidden away under clauses of legal secrecy.

“But that only frees up the hardiest and doughtiest of campaigners to fight that little bit more for more equal pay.

“There were three key amendments put forward by the Liberal Democrats, one jointly with two Labour back benchers on equal pay for the Bill – each on of which would have ensured that the move towards equal pay would come quicker and more widely and for everyone.

“Firstly we argued for mandatory pay audits – exposing the overall patterns of pay (though not individual salaries) to public scrutiny.

“It’s ironic that opponents of equal pay measures often argue that in the market place there can’t be discrimination – because those firms discriminating would be worse off.

“Yet when here was the opportunity to strengthen those market pressures – to give the market more information just as free market theorists tell us the markets need – where were those people? They made themselves very, very scarce from the debates!

“The Government’s proposal only suggests that the information be published voluntarily until at least the year 2013. As the Equal Pay Act was passed 39 years ago and women are still – on the latest Office of National Statistics figures – paid 17% less then men – we are sick of waiting – always jam .

“So instead of this weak measure, I and my colleagues argued that for reasonable sized firms and up – 100 employees would be a good cut-off – there should be mandatory audits with public results so women – or indeed men – could bring claims and avoid companies as they see fit.

“The Equality Commission has most recently been making some bullish noises about the size of the pay gap in the City – warning that if it doesn’t get its act together the Commission will have to use its statutory powers.

“And yet – the Commission flunked the test when the Bill was going through Parliament – for where was its lobbying and campaigning for effective equal pay measures in the Bill?

“The second key area which we argued for during the Bill’s passage – in addition to mandatory pay audits – was on loosening some of the ridiculously tight restrictions on legal action over equal pay.

“For women wanting to prove sexual discrimination in pay they have to be able to give a concrete example of someone else in a comparable job, being paid more. Now –often that exact comparator doesn’t exist. Many people do jobs where there isn’t someone else in a comparable role – and of the opposite gender.

“But no – Labour dug its heels in and insisted there must always be a direct comparator that you can use.

“And thirdly – there was the issue of allowing ‘representative action’. Currently, if a woman believes she has been discriminated against in terms of pay she can take the claim to an employment tribunal.

“But you have to be quite brave and assertive to take a claim forward – and the resources for tribunals etc are so inadequate that there is currently a backlog of women waiting – and waiting – and waiting.

“Thousands and thousands of women are held in this backlog – and women have actually died waiting for justice. The answer to this is simple – allow representative actions, which means one action can cover and so settle many situations – speeding up justice, taking the pressure off each individual and saving the system from breakdown.

“With representative action people such as a trade union or indeed the Equality Commission would be able to take action on behalf of a group of people in the same situation. But again the Government resisted this most obvious of moves forward.

“Three opportunities – three fails – from the Government – and the price paid in more years of unequal pay.”

Lynne Featherstone MP

Calculate the gap: how does your organisation measure up?

 

Are you an employee or an employer concerned about whether your organisation has a gender pay gap?

If so, why not check out the Government Equalities Office website? It has created a simple-to-use online two-step calculator where you can identify whether you or your employees might be victims. Armed with some basic payroll information, you can quickly work out your average gender pay gap. 

Setting a shining example?

The GEO is also encouraging organisations to post their stats on their website, in order to encourage greater awareness, transparency and equality. Why not post them here? You can also see how you compare to various government departments, which have publicised their statistics on the site.

Shortchanged: how does your region measure up?

Join us in the fight for equal pay! A significant gap between men and women’s pay persists, and worringly it’s growing: currently at 17.1%  for full time workers, rising to 37% for part-time workers. The Equality Bill is the ideal opportunity to close the gap once and for all but the current provisions are weak. The bill is still making its way through Parliament so now’s the perfect time to lobby your MP to bring about the vital changes needed.

So what can you do? Well, you can find out how your region compares to the national average with our map of the pay gap across the country and send a letter to your local MP urging them to tackle the issue.

With the widest inequality concentrated in the areas where there is a concentration of highly paid jobs, London has the highest inequality and Wales the lowest.

The Office for National Statistics’ Annual Survey of Hours and Earnings shows that for hourly mean average earnings the regional differences in pay by percentage are:

Wales = 10.9%

Scotland = 13.6%

North East = 13.9%

Yorkshire & the Humber = 14.2%

North West = 15.5 %

West Midlands = 16.0%

South West = 16.3%

East Midlands = 16.4%

East = 18.2%

South East = 21.6%

London = 23.2%

How to get started

Lobby your MP by using our straightforward template letter – find your MP’s address here. Follow the instructions and enter your regional pay gap percentage and send it off. It’s that easy. You can also send a letter to your local newspaper to up the momentum, again we have written a template letter for you.

The more voices that speak out on this vital issue the more chance we have to bring about a once-in- a-generation change.

How do we close the gender pay gap?

In the UK, women working full-time are paid 17.1% less than men for doing equal value. This is down to three reasons:

Discrimination: paying women less than men for doing the same jobs or work of equal value is the single largest cause of the pay gap.

Motherhood penalty: In the UK, women still do the bulk of the caring work. Factors such as a lack of flexible working and the long working hours culture in the UK mean women pay a penalty at work for their caring role.

Undervaluing of tradional ‘women’s work’: jobs traditionally done by women, such as cleaning, catering and caring, are undervalued and paid less than jobs traditionally done by men.

So how do we close the gender pay gap?

The Equality Bill is currently being scrutinised in Parliament. It’s a once-in-a-generation opportunity to reform equal pay law. We’re asking for some key measures to be included in the Bill to tackle the gender pay gap:

-Mandatory pay audits, which would require all employers to conduct pay audits

-Representative actions, which would allow individuals collectively affected by systemic pay discrimination to make a claim as a group

-Hypothetical comparators, which would allow women to point to a hypothetical male comparator in pay discrimination claims.

This is what we’re lobbying for, and with Equal Pay Day we’re showing the Government how much public and political support there is for stronger measures in the Bill.

Get in touch!

Tell us what you think would close the gender pay gap, tell us your stories of pay discrimination, tell us about events you’re planning. We want to hear from you! Comment on our blog or email us at info@fawcettsociety.org.uk, or send us a message on Twitter.

Equal Pay Day – the countdown begins!

Equal Pay Day 2009

There’s just a month to go until Equal Pay Day 2009. In the run-up to 30th October individuals and groups across the UK will be taking action to mark the day that women effectively receive their last pay cheque of the year. This is because the 17.1% full-time gender pay gap is equivalent to men being paid all year round while women work for free after 30th October.

Equal Pay Day 2009 is calling on the Government to get tough on pay inequality in the UK.

Take action
Even if you only have fifteen minutes to spare – you can make a difference and help end the gender pay gap.
•    15 minutes to spare? Collect signatures for the EPD petition
•    20 minutes to spare? Write to your MP or local newspaper
•    30 minutes – 3 hours to spare? Distribute EPD materials
•    3 hours to spare? Visit your MP
•    ½ day to 1 ½ days to spare? Organise an event.

Resources

We’ve got EPD leaflets, posters and stickers for individuals and groups to use in their campaigning. You can also download an activist pack providing all the information you need to make your EPD actions a success.

Click here to visit the Fawcett Society website where you can download all our resources and information.

The gender pay gap isn’t inevitable. Equal Pay Day 2009 is our opportunity to do something about it.

Equal Pay Day 2009 is coordinated by the Fawcett Society and UNISON. For further information please contact Kat Banyard on 020 7253 2598 or email info@fawcettsociety.org.uk