Fines for employers who fail to make progress on gender pay gaps

Woman working at a supermarket checkout


All large public and private employers will be required to prove their gender equality practices or face further auditing and gender pay gap fines under a Labour government, according to the Shadow Minister for Women and Equalities.

Dawn Butler MP says Labour will go further than the Government on gender pay audits. She says it will ensure that gaps are “not just being identified, but that necessary action is being taken to close them”. She adds that employers who meet the criteria will obtain government certification and will be considered for government procurement contracts.

Equal Pay Act

Butler said: “In 1970 Labour introduced the Equal Pay Act but nearly 50 years later, women are still paid on average over 14 per cent less than men.

“It’s time to close the gender pay gap once and for all. But to address these deep rooted inequalities, we need action, not just audits.

“The next Labour government will require all large employers to prove how they plan to tackle their gender pay gaps and prove they are equal pay employers.”

In an article in The Guardian she said that Labour would seek to adopt legislation similar to Iceland which became the first country in the world to require firms to prove what action is being taken to achieve equal pay.

Gender pay audits

Gender pay audits are a way of highlighting any gender pay gaps within an organisation. Legally, employers with over 250 employees have to report on their figures by 4th April. They are currently advised to publish a statement on what they are doing to address any gaps, but there are no sanctions for not doing so. Gaps can be the result of not enough women being in senior positions in an organisation as well as other issues.

They are not to be confused with equal pay which is about being paid the same for work of equal value.  There are currently a number of cases related to equal pay going through the courts.

France is considering introducing new legislation by 2020 to enforce equal pay. It is estimated that there is a 9 per cent wage difference between French men and women holding similar positions and with similar experience and education. It is proposed that software could be installed on company payroll systems to monitor unjustified pay gaps.

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