Commons committee to analyse gender pay gap reporting

gender pay gap


A Commons select committee is to investigate the gender pay gap amid concerns around the compliance of businesses with reporting requirements on the gender pay gap, such as whether the regulations are properly capturing the salaries of staff, and what steps companies are taking to address the pay gap.

The Business, Energy and Industrial Strategy Committee will also look at measures to be taken against companies which do not comply with reporting requirements.

The Committee will also investigate executive pay levels, checking on the implementation of the Prime Minister’s undertaking to crack down on excessive executive pay. It will look at progress in simplifying the structure of executive pay and pay reporting, and the role of remuneration committees, institutional investors and shareholders in curbing excessive pay.

The Committee is likely to examine the use of ‘clawback’ provisions to recover cash and share bonuses in the event of poor performance.

Rachel Reeves, Chair of the Business, Energy and Industrial Strategy Select Committee, said: “Excessive executive pay and gaps in gender pay are at root an issue of fairness. Pay awards for top bosses which vastly outstrip worker pay and which owe little to building genuine long-term value in a company are impossible to justify and damage the social contract between business and the public.

“Unjustified executive pay awards are the most corrosive influence on public trust in business and businesses must face up to their responsibilities and tackle this problem. If businesses don’t step up on executive pay, Government will need to step in.”

She added: “Nearly fifty years on from Barbara Castle’s Equal Pay Act it is completely unacceptable that women are not fully rewarded for their jobs they do. Businesses must pay both women and men fully for the work they do and if they fail to do so they undermine public trust in how they operate.

“Transparency on gender pay is only the beginning. We need to examine why these pay gaps persist, why within the same sector there may be companies with wildly differing pay-gaps, and what remedies are needed to tackle them.”

On gender pay gaps, the Committee is specifically inviting written evidence on the following questions:

  • Whether the annual information related to pay required under the Equality Act 2010 is sufficient? Should any further information be required?
  • What is the extent of compliance? Is the information accurate?
  • How effective are the sanctions for non-compliance with reporting requirements?
  • What requirements, if any, should there be on companies to address gender pay gaps?

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