In the fight for gender equality, the prime minister will today reveal new measures that will force large companies to disclose the gap between the pay of male and female workers.
David Cameron will outline plans that will mean companies with over 250 employees will have to show differences between salaries. Once today’s initial consultation is completed, regulations would be introduced by early 2016. The plan is also expected to include a fine of up to £5,000 for non-compliance.
The aim behind this scheme is to put pressure on employers to improve women’s wages and to help to narrow the gender pay gap. The pay gap currently stands at 19.1% meaning, on average, women earn 80p for every £1 a man earns.
The ruling will hopefully be introduced by the first half of next year and will affect over 10 million workers. The full-time pay gap is at its lowest level since records began in 1997, but Britain still represents the sixth highest gap in the EU, behind Poland and Italy.
Speaking before the announcement, Cameron hopes that this scheme will, “cast sunlight on the discrepancies and create the pressure we need for change, driving women’s wages up.”
“Today I’m announcing a really big move: we will make every single company with 250 employees or more publish the gap between average female earnings and male earnings.”
Criticism of the scheme, however, has come from some business owners and political party members who are concerned by the increase in bureaucracy; increase in paperwork and forms; and of how the information could be misrepresented.
This comes as the announcement that the FTSE 100 has met the target to get a quarter of women in the boardroom within the UK’s biggest companies. The government also plans to create a National Living Wage for over 25s – a scheme that is said to mainly focus on and help women, who tend to be in lower paid jobs. The minimum wage is set to increase to £7.20 per hour in April, rising to £9 by 2020.
Michelle Mone, the founder of the Ultimo underwear company, described the announcement as “absolutely fantastic”, saying that “women should rightly have the same expectation of good pay and progression as men, wherever they choose to work.”
The scheme is hoped to encourage more young women to enter the workplace, and release their hidden potential. It will also highlight companies who are paying women less for equal work, as these would already be acting illegally.
Nicky Morgan, the education and equalities minister, is behind the consultation and is expected to be launching further measures this week, designed to tackle gender imbalances in the workplace. On the subject, she has said, “that to achieve gender equality, we need to continue to inspire young women and girls so that they can compete with the best in the world for the top jobs – and see that their hard work will pay off.”