Articles - Gender pay gap

Employment & Discrimination - Rebecca Tuck

As of 10 January 2018, some 550 organisations have provided their “gender pay gap” information; some 9000 returns are due by 30 March 2018, all of which will be on the government portal. This is to comply with the obligation imposed on private and voluntary sector organisations with 250 or more employees, under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, and for public bodies with 250 or more employees, the Equality Act 2010 (Specific Duties and Public Authorities Regulations) 2017. The brief information required is:

  • the mean pay gap (the difference between the average hourly earnings of men and women) and median pay gap (the difference between the midpoints in the ranges of hourly earnings of men and women)
  • how many men and women are in each quartile of the employer’s payroll
  • percentages of staff receiving bonuses by gender, and the gender gap on bonuses.

 

The government website provides a link to the gender pay gap report produced by the organisation on their website; though as reported by the FT on 7 January 2018, at that time almost a third of the returns failed to provide a link to their supporting statement.

The FT reported in December 2017 that sixteen of the companies which had submitted their data at that time, reported a zero pay gap, with nine of them reporting identical proportions of male and female employees in each pay quartile of the payroll. It is unsurprising that a Professor of Economics and Public Policy – Jonathan Portes of KCL, have deemed this possible but “entirely implausible”! The Department of Education who administer the government portal are not responsible for checking the data provided.

A survey of FTSE 350 company secretaries conducted by Institute of Chartered Secretaries and Administrators in conjunction with the FT reported that under a tenth of the FTSE 350 company secretaries had changed any pay policies or strategies as a result of reporting their gender pay gap, although 45 per cent said that their company’s remuneration committee considered the gap when discussing executive remuneration. Meanwhile, “pay consultants” are reported to have suggested that, in digging up the required data, “employers have discovered that they may be inadvertently breaking the law, which — since the Equal Pay Act of 1970 — requires that employers pay men and women equally for the same job.”

Of course, a gender pay gap is not the same thing as failing to ensure “equal pay” – that men and women are paid equally for doing like work – or work of equal value, and perhaps what the gender pay gap reports show most starkly is the huge preponderance of men dominating the top pay quartile and women dominating the bottom.

An organisation much in the news this week, has been the BBC. Their report spends its opening pages explaining “why equal pay and the gender pay gap are not the same”,  highlighting the national average gender pay gap of 18.1%  and stating that one of the main reasons for this is that men are more likely to hold senior positions. Only after this, and after setting out its workforce gender split (52% male and 48% female) then does it set out its gender pay gap of 9.3% using median pay. The regulations ask firstly about mean pay – but this higher figure of 10.7% does not appear in the BBC (or other) headlines which have followed. Those in the lowest pay quartile are 50% female, those in the upper quartile just 30% female, indicating that indeed men are more likely to hold senior positions.

This is of course only the latest information about pay to be published by the BBC. In July 2017, pursuant to its Royal Charter commitments, it published the names of all “employees and on-air talent paid over £150,000 p.a.”. Just 35% of them were women. An Equal Pay Audit conducted by PwC  (which itself has a gender pay gap of 33% using mean hourly pay) and Eversheds (yet to report) was published in October 2017, and reviewed by the Rt Hon Sir Patrick Elias, who concluded that there was no evidence of “systemic gender discrimination”.

It is reported that up to 200 women in various grades and roles across the BBC have made pay complaints since July 2017, around 120 of which are being pursued by the NUJ on behalf of members. The most high profile of these (this week at least) is certainly that of Carrie Gracie, the BBC’s China Editor. She discovered in July 2017 that of the four international news editors, the two men were paid at least 50% more than her and the other female international news editor. Her open letter of 7 January 2018 to the BBC audience states:

“I am not asking for more money. I believe I am very well paid already – especially as someone working for a publicly funded organisation. I simply want the BBC to abide by the law and value men and women equally.

Salary disclosures the BBC was forced to make six months ago revealed not only unacceptably high pay for top presenters and managers but also an indefensible pay gap between men and women doing equal work. These revelations damaged the trust of BBC staff. For the first time, women saw hard evidence of what they’d long suspected, that they are not being valued equally.”

Winifred Robinson of Radio 4’s You and Yours tweeted her support of Ms Gracie, with the hashtag “istandwithcarrie”. She was taken off air. This perhaps serves as a reminder of the need to be aware of not only gender pay gap reporting obligations and equal pay obligations, but also of the provisions relating to victimisation? Meanwhile another BBC pay audit – this one into presenter pay - is being prepared by PwC and is expected by the end of January 2018.

Whatever the use which can be made of gender pay gap data, it has certainly brought to the fore questions about equality.

The Bank of England gender pay gap report highlights that its strategic plan has as its first pillar the requirement for a “diverse and talented” workforce, says it is “working hard” to address the imbalance of those in senior roles being mostly male, by “inclusive and diverse recruitment including diverse shortlists and interview panels, offering flexible working, providing continual unconscious bias training and fostering an inclusive culture”. Its Women in the Bank network has just celebrated its 10th anniversary, and during that time female representation at senior management level has increased from 20% in 2014 to 30% in 2017 – but with a male governor (there  has never been a woman) and 4 male deputy governors (Charlotte Hogg resigned just as she had been promoted in 2017, while Nemat Shafik left after a three year stint in 2017), and 21% gender pay gap, change can be slow, even where it is desired.

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