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Exploring the Gender Pay Gap

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This article has been submitted by NewLaw Solicitors

In this, the week in which we celebrated the centenary of the Representation of the People Act giving  women aged over 30 and “of property” the right to vote, we look at the issue of the Gender Pay Gap and how far we have come and how far there is still to go.

The struggle for equal pay has a long history; August this year will mark 100 years since the London Transport Women Workers’ strike and June will see 50 years since women machinists went on strike at the Ford Car Plant in Dagenham. While neither succeeded in achieving pay parity, both won victories and the latter contributed to the campaign for equal pay which led to the passage of the Equal Pay Act (1970).  However, while the Act was passed in May 1970 it was not implemented until January 1976; a delay which many believe allowed employers to adjust and/or regrade jobs for the purpose of avoiding their equal pay obligation.

Nevertheless, the Act meant men and women were entitled to equal pay/terms if they were engaged in the same or broadly similar work (equal pay). Job done! Society could give itself a collective pat on the back. Except while the Act did exactly what it said on the tin it did not address or resolve the inequities in a labour market that pays women less, on average, than men, irrespective of their job or position (the gender pay gap).

By 1997 (when the ONS first started collecting data[i]) the gap between what male and female full time workers earned (based on median hourly earnings) was 17.4%. To say progress since then has been snail like would be an insult to all shelled gastopods. The ONS stats put the gap between male and female full time workers at 9.1% in 2017. However, if you look at all workers, both full and part time, the median average gap is still 18.4% (having risen slightly from 18.2% in 2016).

The percentage varies across sectors and throughout the UK, with London making almost no progress at all over the last 20 years in reducing the gap. Ahead of the curve when Aqua released Barbie Girl in 1997 at 15.1% the gap has only narrowed to 14.6% in 2017. In London the streets may be paved with gold, but if you are a woman you should only expect them to get you 85% of the way home. While Wales itself has a lower than average gap at 6.3%, Blaenau Gwent must deal with the infamy that comes with having the greatest differential maintaining a 32% difference in the wages of male and female full-time workers. Northern Ireland on the other hand is the only region in the UK where the pay favours women over men. There women earn on average 3.4% more than men.

The causes of, and the factors that influence, the gender pay gap are oft debated and rarely agreed; to try and deal with each in a short article would be a fool’s errand. However, what is clear from the ONS statistics is that age is a key factor. There seems to be little difference between men and women in their 20s and 30s with the pay gap opening up as people enter their 40s.

Here, traditional gender divisions in respect of familial responsibility (care for children or elderly relatives), can result in time out of the labour market which can in turn affect earning levels upon their return. This can lead to occupational downgrading; women working below their potential due to a lack of flexible working practices or part-time work in higher skilled roles.

This is by no means the only reason for the gap; other factors include the undervaluing of women’s competences and skills, gendered education and career choices, occupational segregation and good old fashioned discrimination, be it conscious or unconscious, direct or indirect. In 2017 the BIS and the Equality and Human Rights Commission found that three in four mothers (77%) said they had a negative or possibly discriminatory experience during pregnancy, maternity leave, and/or on return from maternity leave[ii].

It is clear that the “part time penalty” has a substantial impact upon the figure; this is because 41% of female employees work part-time compared to 12% of male employees[iii], while the pay rates for part-time employees are much lower than full time employees. Here some seem to jump on the argument that women having children is a “lifestyle choice”. They then wrap themselves in the argument like it’s a warm misogynist comfort blanket, claiming that a pay differential is the natural consequence of that choice. By extension nothing can be done to rectify it so therefore they are absolved from even trying.   Having a labour market that in some contexts views those working less than a 40 hour week (plus overtime as needed) or those with caring responsibilities as less committed is, discrimination aside, detrimental to society as a whole.

The introduction of gender pay gap reporting legislation last year was a least an attempt to shed a light on the gender pay gap in organisations with over 250 employees, and we have started to see some companies facing public scrutiny for the differences in their pay. Of the 500 plus companies who have published gender pay gap reports the results varied widely, with Easyjet and Phase 8 coming in for particular criticism after reporting 51.7% and 64.8% differences respectively between men and women.

The equal pay campaign group the Fawcett Society have argued that, given the rate the mean average has decreased over the last five years, parity (0% gap) would not be achieved until 2117. By which time, if certain sections of the British press are to be taken seriously, all our jobs will be undertaken by robots in any event. Given the possibility of this persisting for another 100 years it is difficult to argue that there is not a pressing need for further action to spur on change and serious questions need to be asked.  Is naming and shaming companies is enough?

If we cannot come up with a better plan then I for one will welcome our robot overlords. At the very least any decision about whatever limited pay we do get will likely be based on logic alone.

[i] Annual Survey of Hours and Earnings: 2017 provisional and 2016 revised results

[ii] Pregnancy and Maternity – Related Discrimination and Disadvantage

[iii] House of Commons Women and Equality Committee – Gender Pay Gap