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Kate Palmer from employment law experts Peninsula outlines some of the issues for employers around pay transparency after the Fawcett Society’s call for women to be allowed to know male colleague’s salaries.
The Fawcett Society is calling for women who suspect pay discrimination to be allowed to know what male colleagues doing a similar job are earning. It says this call for greater pay transparency is backed up by a survey it has conducted which shows 79% of people support it, including three quarters of men.
Employers will understandably fear that being forced to disclose pay practices will open up a ‘can of worms’ and leave them open to additional tribunal claims from disgruntled staff. However, providing pay practices remain fair, an increase in transparency may help disprove any suspicions that female staff have and guard against further unrest.
There is generally no requirement for employers to announce specific salaries to their workforce and, given that money can often prove disruptive at work, some businesses actively look to prevent any discussions by using pay secrecy clauses. Equal pay law already allows staff to ignore these restrictions if the reason for their discussions relates to concerns over unlawful pay practices.
Forcing employers to confirm to female staff exactly what their male counterparts earn will certainly cause businesses to re-think the way they distribute salaries. Employers will need to be able to justify how salaries are decided and rely on a lawful reason for any significant differences.
With this in mind, employers are increasingly being encouraged to avoid asking candidates about previous salaries during job interviews, as critics suggest using these responses to decide wage offerings could have a detrimental impact on women and perpetuate the gender pay gap.
It is also a positive sign that such a large percentage of male employees appear to be on board with this suggestion, as they may be forgiven for feeling somewhat uncomfortable at the prospect of having their salaries disclosed to female colleagues. However, if the UK is to succeed in reducing the gender pay gap, it is clear that support is needed from all quarters.
Many organisations already use a banding system for working out staff salaries to ensure wages remain fair for staff working in similar roles. Naturally, there may be some slight variation, depending on an employee’s responsibilities or experience. However, introducing bandings where possible may generally reduce concerns over unequal pay based on gender.
*Kate Palmer is Associate Director of Advisory at global employment law consultancy, Peninsula.