The gender pay gap is a very hot topic, not just among policy makers but also for companies that will have to comply with gender pay reporting rules due to come into effect in April 2017.
A recent report from the Institute for Fiscal Studies (IFS), The Gender Wage Gap, highlighted that gender wage differences are still very substantial. The Fawcett Society, a leading charity on gender equality, believes it will take over 50 years to close the gap given the current rate of progress. All this despite the Equal Pay Act being introduced over 45 years ago.
On average, the hourly wage for women in the UK is 18% less than that of men. While the pay gap has been closing, research suggests that progress has stalled. Various factors contribute to gender pay disparity:
- Certain types of low paid jobs – such as care and leisure – are more likely to be done by women.
- Having children gives rise to a continually widening gender pay gap. The IFS report shows that by the time the first child is aged 12, women’s hourly wages are a third below men’s. According to the Equality and Human Rights Commission, around 5,400 women a year are being forced to leave their jobs following pregnancy or upon their return from maternity leave.
- Women play a greater role in child care, or caring for elderly or disabled relatives. Therefore more women work part-time and are likely to be on lower pay.
It doesn’t make sense that despite being increasingly better-educated, women are still not achieving higher pay.
What are your legal rights?
Under the Equality Act 2010 (the Act), employers must give men and women equal treatment in the terms and conditions of their employment contract. It stipulates that women have the right to the same pay as a man, where they are doing:
- ‘like work’ – this means work that is the same or broadly similar as a male colleague;
- ‘work rated as equivalent’ – this refers to work rated as equivalent under a job evaluation scheme; and
- ‘work of equal value’ – this covers work which is different to a male colleague but of an equal value in terms of effort, responsibility, decision making and the skill involved.
The Act prohibits disparity not just in terms of wages but contractual terms generally. This means there should be parity in respect of contractual bonuses, other performance related benefits, overtime rates, annual leave entitlements and, hours of work. Here, I’ve used ‘pay’ as a shorthand to refer to such contractual benefits.
What steps can you take?
Under the Act, it’s unlawful to prevent employees from having discussions to establish if there are differences in pay. But the reality is that people tend not to talk about their wages or the level of bonus they received, so it’s often difficult to find out if your pay is fair compared to colleagues.
Often information is disclosed inadvertently in the pub or at office parties, and can lead to a disgruntled employee demanding their boss redresses the balance by awarding a pay rise. But you need to tread carefully and gather as much information as you can.
Identify your comparator
You must be able to identify an actual comparator. This will be a man doing the same, similar job or job of an equal value but whom receives better pay. It does not matter that there might be another man doing the same job and who is paid the same as you. The comparator does not have to be employed at the same time as you, it can be your predecessor or successor. You can choose as many comparators as you want. It is not unusual to find a woman in a predominantly male team being paid less than her male colleagues.
Consider possible reasons for the difference in pay
In equal pay cases, employers often try to put forward a defence that the difference is justified because the work carried out by the comparator(s) is ‘different’.
Employers may point to factors such as the male colleague having a more senior or different title, managing staff or possessing particular qualifications. These factors will not necessarily allow your employer to argue that the work is different. What needs to be looked at is the substance of the work being done.
To head off such responses, try to gather evidence that will support you. For instance, find a copy of the job description or advertisement for your comparator’s role. Consider the work you do and your responsibilities as compared to your comparator, in addition to any potential differences.
Bear in mind that your employer might use such differences to justify the pay gap and be prepared to counter your employer’s arguments. For example, if your employer says that your colleague earns more because he has particular qualifications, if those qualifications are not relevant to the role, you can challenge that as a reason to pay him more. An employer may defend a claim if it can show that the reason for the difference is due to a genuine factor and not based on your sex.
Make your employer aware of your concerns
The first step should be to speak with your manager or HR. Outline your concerns, in particular setting out why you feel that your job is the same as, similar to or of equal value to your colleague.
If a chat does not lead to a satisfactory resolution you should raise a written grievance. In raising your grievance, follow the ACAS Code of Practice on Disciplinary and Grievance Procedures (the Code). If your claim succeeds but you failed to comply with the Code, the tribunal could reduce your compensation by up to 25%.
Serve a questionnaire on your employer
This will help you obtain information and facts relating to your complaint. ACAS has prepared useful guidance on ‘asking and responding to questions of discrimination in the workplace’.
Take legal action
Ultimately, you can enforce your legal rights by bringing a claim against your employer. You should take advice at an early stage as sometimes it can be tricky to identify whether your claim is for sex discrimination or equal pay. It is important to get this right as the time limits are different.
You can bring a claim in the employment tribunal:
- while you are still employed;
- within six months’ of the end of your employment;
or in the High Court or county courts within six years’ of your employment ending.
Equal pay claims can be of significant value, as you are entitled to receive interest and pay, backdated for up to six years. It is now mandatory to go through the ACAS conciliation period prior to submitting a claim in the employment tribunal.
Things can only get better?
Regulations due to come into effect in April 2017 will require private and voluntary sector employers with 250 or more employees, to publish their gender pay figures and to provide details of an pay gaps as well as set out proposals for closing them.
Affected employers will be required analyse their gender pay gap and publish a report within 12 months and annually thereafter. The report will be published on the employer’s website and will be accessible to anyone.
However, the regulations do not contain any enforcement provisions or sanctions for non-compliance. The government has said it will run checks to assess compliance and publish tables to ‘name and shame’ those companies that fail to comply. At this stage it’s difficult to see how effective the regulations will be in closing the pay gap. Let’s hope we don’t have to wait 50 years.