Gender pay gap reports indicate firms struggling to narrow pay gap
Last week saw the deadline for firms to report on their gender pay gaps once again. The data submitted indicates that around 78% of firms still have a pay gap in favour of men, and that over half of firms had not narrowed the gap they reported last year. Nearly a quarter of firms reported a pay gap of more than 20% in favour of men.
A gender pay gap does not necessarily indicate a risk of legal claims, which would only arise in cases where businesses are failing to pay men and women the same rates for the same or equal work. Gender pay gap data is not sufficiently granular to reveal such issues; businesses are only required to report on the gap across their workforce as a whole, without needing to break down the gap by job type. In this context, it is possible that some organisations have viewed gender pay gap reporting as simply a box-ticking exercise, and have attributed their pay gaps to societal or historical factors, such as the continued expectation that women take on the majority of childcare responsibilities in their families.
It is against this backdrop that some commentators have suggested that the gender pay gap regulations become tougher, with Sam Smethers of the Fawcett Society arguing that employers should also be required to set out a 5-year plan for addressing their pay gaps, and that progress against this plan should be monitored. While this suggestion is understandable it is difficult to see how it could work in practice. It is perhaps also unrealistic to expect gender pay gaps to narrow significantly in such a short period of time, particularly given that many businesses have implemented strategies which are likely to have more of a “slow-burn” effect, such as more favourable family-friendly policies and flexible working practices. The hope is that, over time, such practices will be adopted more widely and that this will have the effect of not only narrowing the pay gap but improving overall equality of opportunity and treatment in the workplace.