In light of the Equal Pay Day 2020 report published by the Fawcett Society today which revealed that 43% of working women are worried about job or promotion prospects, Charlie Thompson, Employment Partner at Stewarts law firm discusses the continued issues of the gender pay gap in certain sectors and the potential for a rise in equal pay claims.
“After 3 years of compulsory gender pay gap reporting, the ONS reports that the pay gap across all employees in the UK continues to fall, slowly but fairly steadily (from 17.8% to 15.5% between 2018 and 2020). Among full-time employees, the gap is lower (7.9%). It also showed that amongst full-time employees under the age of 40, the gap is almost zero. However, above that age the gap is higher, and there remains a larger gap in hourly pay amongst higher earners.
“Whilst progress is being made, many of the old problems remain. Where employees reach a more advanced stage of their career or potentially have care responsibility or need to work part-time, the gender pay gap continues to be wider. In some sectors the problem seems to be particularly entrenched and indeed getting worse. BBC research earlier this year suggests that in financial services the average pay gap is rising, and is particularly wide in bonuses. Despite economic doom and gloom, some sectors have held up this year or even outperformed expectations, and where bonuses are awarded in the coming months, many women will be carefully scrutinising their employer’s decisions.
“The right to equal pay has been enshrined in law since the 1970s, and despite the introduction of compulsory reporting and the fall of the gap (albeit slowly), the number of equal pay claims submitted to the Employment Tribunal each year remains fairly steady. Whilst equal pay claims in the Employment Tribunal are subject to strict six month limitation periods, in other forums like the County Court and the High Court, the limitation period is 6 years, so there may be a large number of potential claims not registering on employers’ radars. With increased public awareness of the gender pay gap, and high profile stories such as Samira Ahmed’s successful claim against the BBC in January, more claims may be on the way.
“Failing to address the pay gap is not only a potential PR own goal, but can lead to expensive legal disputes, and one improperly-handled complaint can have a domino effect – even if it does not proceed to litigation or is settled. Employees are becoming increasingly less shy or embarrassed about discussing their pay with each other than they were a generation ago.”
Rebecca Hourston, Managing Director at Talking Talent, discusses the shocking reality of Equal Pay Day and what needs to be done in order for all workers to progress through their career as equals.
“The shocking fact that women in their mid-30s may never know equal pay in their working lives is unthinkable. And it clearly demonstrates that not enough is being done to close the gap and bring true equality to the workplace. Equal Pay Day should hit hard for all of us, as it serves as a reminder that our work is nowhere near complete. The global pandemic has certainly worsened the situation, as the recent Deloitte report shows, with 82% of women confirming their lives have been negatively disrupted by the pandemic – and nearly 70% of these women are concerned their career growth may be limited as a result.
“But this is no excuse. More needs to be done to support working women and close that gap for good. From this day until the end of the year, women effectively stop earning relative to men – this cannot be allowed to continue. When businesses put a plan of action in place to nurture, engage, enhance and invest in female talent, they will discover it’s not about a battle of the sexes. Temporarily targeting specialist areas within a company to capitalise on micro-coaching opportunities will help strengthen the whole.
“There’s no excuse not to champion women – and the businesses that do will realise the proven bottom-line and culture benefits as a result. As a society, we need to dial up our efforts and reverse this staggering trajectory, so that all members of this workforce progress on a level playing field.”