Today is the deadline for gender pay reporting for private companies with over 250 employees. The Prime Minister has called the issue “a burning injustice” and the CBI’s Director-General Carolyn Fairbairn says there is no excuse for failing to report accurately and on time. She has also issued a call for a partnership approach between companies and Government to tackle the many causes of the gender pay gap that lie outside the workplace, for instance, attitudes to men and women sharing childcare, so that lasting change can be delivered.
At the end of last week the deadline passed for public sector organisations to report their figures. Some 1,643 public sector organisations did so. It is thought around 2,000 are required to report. It was reported that several had not reported with just hours to go until the deadline. The Equality & Human Rights Commission has said organisations that do not report in time will be sent a letter and warned that they could face unlimited fines. Labour MP Harriet Harman says the EHRC must be aggressive to force through changes that would reduce the gender pay gap.
The figures filed for public sector organisations show that women are paid on average 14% less than men despite the fact that women are more likely to work in the public sector than men due to a variety of factors, including the greater availability of flexible working at all levels of an organisation.
The figures makes for interesting reading, although there are clearly particular circumstances at play in different organisations. In general they show that organisations with few women in the top quartile [the figures are banded across four quartiles] have a larger gender pay gap. For instance, at the Bank of England women are paid on average 21% less than men and there are fewer women at the top. This trend is particularly marked if they also have a lot of women in the bottom quartile. However, in some cases women are still paid lower despite there being more of them in senior positions. Dr Sumita Ketkar, Senior Lecturer in Leadership and Professional Development at Westminster Business School, says: “In the rare cases where a larger proportion of women are in the top quartile, the median salary of men is still likely higher than of women. The rationale appears to be that there are so few men in these companies that they are be paid higher bonus and salaries in such companies in order to be retained.”
Birmingham City Council, which was at the centre of several equal pay claims, has an average gender pay gap of 9.1% although there are more women at the top level than men. Its figures also show there are more women than men at the bottom level. British Transport Police, however, has a 3.7% gap, but only 26% of those at the senior level are women. Nevertheless, it has fewer women at the bottom level and the women who get bonuses tend to get bigger bonuses than men. Meanwhile, at Barnet Council there is a 5% average gender pay gap in favour of women, although there are more men at the top level of the council. However, there are more women than men in the middle levels.
Some of those with higher reported gender pay gaps include Crossrail which has a 31.1% average pay gap. Only 16% of employees in the top quartile are women, compared to 52% in the bottom quartile. Women who get bonuses tend to be paid lower, which may be related to the role they hold. In the Civil Service, the Department of Transport has a 16.9% pay gap, in large part due to the lack of women at senior levels. Although women are more likely to get bonuses, their bonuses seem to be less generous. This compares to the Department for International Development where the average pay gap is 8.5%. Some 46.8% of those in the top quartile are women.
However, even when there are more women in all quartiles as occurs at Durham County Council the average gender gap for women is 3.4%. And at the Nursery and Midwifery Council there is a 1.9% gender pay gap despite women being more numerous across every quartile. There must, therefore, be particular issues at play.
Nevertheless, a few employers have reported a gender pay gap in favour of women. Redbridge Council announced in early March that its average gender gap is 3.2% in favour of women. It has more women than men in the top quartile and fewer women at the bottom. It says its data shows that the council has a very low ratio between the highest and lowest paid employee.
The data itself is very basic and that in itself has been the subject of much criticism, but when taken together there are some general themes that emerge which indicate a link between pay gaps and the spread of women/men across all levels ie it is not enough to have a balance of women at the top if the majority of those situated at the bottom are women. Moreover, it is important to pay attention to bonuses – not just who gets more bonuses, but whose bonuses are highest, although many in public sector organisations don’t receive them. This will be a more noteworthy figure in the private sector. Other factors which are likely to receive more attention include how performance-related pay impacts the gender pay gap and how large gaps between the highest and the lowest earners in an organisation affect the figures.
A cross-party group of MPs launched a campaign this week following up on the gender pay audits and encouraging women to keep up the momentum for greater equality at work.
Chloe Chambraud, Gender Equality Director, Business in the Community, said gender pay gap reporting on its own isn’t enough. She called for employers to be more transparent and inquisitive about their gaps and explain the reasons for those differences and what they can do to eliminate them. She stated: “Under-representation of women in senior roles continues to be an issue, partly due to the lack of progression to senior roles. Even though women outnumber men at university, women’s careers suffer as soon as they become mums because they take time out of the labour market and part-time work. The uneven distribution of caring responsibilities is the biggest barrier to women’s progression and this is why to help mothers, employers need to help fathers too.
“Ultimately, only calculating and publishing gender pay gap figures is not enough. To ensure their workplaces are truly inclusive, employers must understand the factors driving their pay gaps and the groups of women who are most affected. Employers must address the root causes of inequality, from reducing bias and increasing transparency in recruitment, appraisal and promotion processes to normalising flexible working, for men and women, and offer financially viable parental leave packages. Only then we will ensure that men and women have equal lives at work and home.”
*You can check the figures for different employers here. Workingmums.co.uk has been publishing its Best Practice Report for several years, highlighting how the most progressive employers are tackling the gender pay gap through innovative approaches to flexible working, family support, dads, women’s career progression and talent attraction.
**Figures in this article are based on statistics for the mean hourly rate. The mean gender pay gap is a measure of the difference between women’s mean hourly wage and men’s mean hourly wage. The gender pay gap includes a figure for mean hourly pay and for median hourly pay. The median gender pay gap is the difference between women’s median hourly wage (the middle paid woman) and men’s median hourly wage (the middle paid man).