In 2007 the UK had a National Gender Pay Gap of 16%. Despite changes in legislation and numerous successful Governments introducing measures to claim down on wage discrimination based upon gender the gap has continued to widen.
On average, women today earn £5,000 less per annum than their male counterparts: That’s a difference of more than £369,000 during their working lives. As we celebrate national women’s day today, and given the tough measures introduced to combat the practice, it’s clear that message is still being largely ignored by many employers.
The gap between salaries for men and women first increased in 2008 – a time when the financial crisis began to bite. Freezes in public sector salaries, the credit crunch and universal job cuts as organisations in both the public and private sectors began to tighten their belts accordingly may all offer some clues, but it’s perhaps worth noting that the pay gap is prevalent across all sectors, despite what might be presumed about ‘gendered’ roles such as those in Engineering and Nursing:
- Banking, Insurance and Pensions: 41%
- Health and Social Work: 32%
- Manufacturing: 19.5%
- Hotels and Restaurants: 17%
- Construction: 12%
- Education: 12%
So what does the Law say?
- 1975: The Equal Pay Directive established a right to equal pay for work of equal value and marks the first legislative move towards closing the pay gap
- 2004 The Equal Pay Act Amendment allows back-pay for up to 6 years to be paid where a claim is founded, meaning the risks for an employer are huge.
- 2015: Tribunal compensation pay for discrimination claims, including those related to gender, are uncapped. As a result of this, the average pay out in 2015 was a massive £7500 excluding the cost of back pay, injury to feelings and legal fees
- 2017: Gender Pay Gap Reporting. Coming into effect from April, these new rules make it mandatory for all employers with 250+ staff to audit publish their pay gap. For more details, visit: http://thehrexperts.co.uk/?p=234
The message is clear: salary discrimination based upon Gender is not only illegal, but can potentially be extremely costly for business if not properly identified and address. Back pay, tribunal fees, and damage to reputation makes unequal pay a costly error.
EOC, Facts about Women and Men in GB, May 2006
Office for National Statistics (ONS)