Credit: Jeff Fenton/Flickr

Gender pay league tables are a blunt instrument

Education secretary Nicky Morgan has announced that Britain's largest firms will be forced to publish data on their pay gaps.

by Rebecca Smith
Last Updated: 30 Mar 2016

If there’s one thing likely to get the backs up of big corporations, it’s forcing them to act against their own wishes. So the new approach to tackling Britain’s gender pay gap is interesting for that reason alone – the government will make the UK’s largest firms publish detailed information about gender pay imbalances in their workforces. When all else fails, why not try some old school naming and shaming?

The proposals were announced last year, but in rules published today, employers are in for a nasty shock as they’ll have to disclose quite a bit more data than they had been expecting.Those with 250 employees or more will have to publish their mean and median gender pay gaps for salaries and bonuses, as well as announcing the number of men and women in each salary quartile.

Government being what it is, businesses won't actually have to start sharing information until April 2018, so there’s still some time for hasty amendments to pay packets if need be (or to trim employees to get below 250 if things are that drastic...).

There are also going to be league tables ranking whole sectors against each other according to their average pay gaps. The UK’s very own oppression Olympics. Firms are likely to be squirming for the time being as the government hasn’t yet decided whether league tables will also be published for individual companies.

Recent figures suggest that the gender pay divide hasn’t budged much – the total gap in median hourly pay is unchanged since last year at 19.2%, according to the Office for National Statistics’ Annual Survey of Hours and Earnings. It’s a record low for full-time workers, standing at 9.4%, but that’s still only 0.2% less than last year.

These latest measures have some appeal, but it is tricky publishing data like this without considering wider context – it’s not as cut and dry as men being paid more than women. Women in some sectors may be more likely to work part-time than men; which then in itself could spark off a separate debate over just why that is.

Carolyn Fairbairn, the CBI director-general, warned that, ‘Data will only be able to present a partial picture,’ and the naming and shaming approach was an unwise one. ‘Where reporting can be useful is as a prompt for companies to ask the right questions about how they can eradicate the gender pay gap.’

A new Glassdoor report surveying over 8,000 people Europe-wide, revealed that 76% of UK employees feel men and women are paid equally, so the publication of pay data could raise some eyebrows. Particularly when 76% of female employees surveyed said they were unlikely to apply to a firm where they believe a gender pay gap exists.

While it still only served as a small part of improving equality at work, the Davies Review achieved its goal and did so through setting a voluntary target. Forcible measures may shine a light on glaring inconsistencies, but they also have the potential to backfire.

Then there is the bureaucratic burden of compiling the figures in the first place, an addtional expense which might be more readily borne if this new 'name and shame' approach was also backed up with some more nuanced long term measures...

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