If my inbox is any indicator of the current level of interest in this topic, then yes, it is: there’s a strong searchlight currently shining on employers and looking at how salaries and bonus payments are decided – in much the same way, as, a few years ago, there was a lot of attention paid, in the wake of the Davies Review, to the issue of women on boards.
In advance of some forthcoming sponsored content from employment law firm Nationwide Employment Lawyers who will summarise the details of the legislative approach to closing the gender pay gap, here’s my round up of some of the current news stories on this topic.
New (UK) rules published last week revealed that employers will have to disclose far more data on pay levels than they had expected. Companies have been waiting for these rules with trepidation and some fear they will be hit with big lawsuits from female employees when they publish the data. However, employers will not have to publish any information until April 2018, giving them more time to prepare than many had feared.
Companies with 250 employees or more (about 8,000 firms) will have to publish both their mean and median gender pay gaps for salaries and bonuses. They will also have to publish the number of men and women in each salary quartile. The government said it will use the data to produce sectoral league tables that rank whole sectors against each other according to their average pay gaps. As reported in the FT, a government spokesman said they had not decided whether to also publish league tables of individual companies.
Employers must also publish their gender pay gap on their websites. They will have to report every year and senior executives will be expected to sign off the figures personally. However, I find myself agreeing with Frances O’Grady of the TUC when she notes that:
“It is a real shame that bosses won’t be made to explain why pay gaps exist in their workplaces and what action they will take to narrow them.”
If you’ve ever wondered what the pay gap might look like as it relates to your job, here’s an American (but I imagine the model is similar for UK roles) calculator from the Motto newsletter. And the New York Times reports that President Obama has announced a similar approach to the UK aimed at closing the American gender pay gap.
Meanwhile, Adzuna, a job search site, has released data suggesting women in the UK are much more likely to be underpaid than men. Three out of five women could be earning less than their ‘market value’ compared to just two in five men, highlighting a clear gender divide. While only 17% of women surveyed earned over £50,000 per annum, almost double that percentage (32%) of male workers were paid at that level. At the other end of the scale, more women (20%) than men (13%) reported earnings under £20,000 per year. The research analysed self-reported actual salaries of over 20,000 UK workers to highlight salary variations across genders, 20 industries and 12 UK regions.
However, some companies are taking matters into their own hands: Intel claim to have closed their gender pay gap and Swiss bank UBS is reviewing its compensation to look for—and address—instances where male bankers are paid more than their female colleagues.
Reuters have examined how the (US) gender pay gap hurts women’s retirement plans (clue: it means working for an additional ELEVEN years). And, in case you were wondering if this gap was due to having had a career break at some point, mid-career – nope:
“A woman who works full-time over a 40-year period loses $435,480 in lifetime income (today’s dollars) due to the wage gap, according to the National Women’s Law Center (NWLC), a nonprofit legal and advocacy group. Put another way, the typical woman needs to work 11 years longer than a man to achieve accumulated income parity.”
However, equal pay for millennials is a boost for equal parenting, trumpets the FT. So it’s all good for future generations – in theory, at least.
To all of this, we can add the recent news stories in which we learned that, not only do women tend to earn less, they also have to pay more for the same items – here’s the BBC’s take on the gender price gap, where we can see that, at its most simplistic, pink stuff costs more than blue stuff.