Minding the pay gap

OonaKing4x3.jpgOona King on the coach and horses about to trample around Parliament

Today we will see a coach and horses arrive at Parliament. Not so unusual, but on this occasion it will ride through the spirit of change left by the last Labour government. The Equality Act 2010 was a landmark piece of legislation which simplified, strengthened and extended protection from discrimination. One of the most persistent areas of inequality – first addressed by Labour over 40 years ago – is the gender pay gap.

The Equal Pay Act of 1970 sought to remedy the fact that women were systematically paid less than men. Yet last year, instead of narrowing, the gap actually widened slightly by 0.1%. This figure might seem small but not only are we riding in entirely the wrong direction, we are also witnessing significant hidden regional and sectoral variations. In London for example, women are now paid 13% less than men. And across the UK, women in full-time employment in the private sector are paid a staggering 20% less than their male counterparts.

So what is the Coalition government doing to address this blatant discrimination against women that often impacts hugely both on the children they care for, as well as pensioner poverty once they retire? Not a lot, actually. 

For a start, they've been dragging their feet over the important regulations contained in the Equality Act on Equal Pay Audits (EPAs). Regulations that finally come before Parliament today.

Such audits are an important mechanism to bring the gender pay gap to light. Essentially, where companies have broken the law around equal pay, EPAs switch the lights on, so employers and employees can see exactly where the problem lies. Cloaking pay structures in darkness (which is why this problem has dragged on so long) doesn't solve anything. It just increases a company's liability at some future employment tribunal. The best companies carry out voluntary EPAs. Most however, don't.

Ministers have decided to exempt micro-businesses (those with less than ten employees) who break the law on equal pay, from carrying out an EPA. Why? It can hardly be a burden on business: how hard is it to look at ten pay slips and compare job descriptions?

The Equality and Human Rights Commission estimates that for a business twice that size (20 people) with five job roles, an EPA takes half a day. So for a micro-business we're looking at about two to three hours work. The government is happy (quite rightly) to slap hundreds of hours of community service on individuals who break the law; yet if that individual owns a business and pays women less than men, Ministers are literally proposing that employment tribunals turn a blind eye. Continuing to hide behind a "burden on business" mantra, illustrates that they frankly don't care about the burden on women. 

Over a lifetime, the pay gap burden for women in full-time work stands at £361,000. The government's foot-dragging might be less insulting if we were making swift progress. While last Friday’s headline on The Evening Standard was ‘Pay gap widens’, it has been going this way since 2010. UK women are now missing out on an extra £177 a year in their pay packets because the Coalition has failed to make the same rate of progress to close the gap as Labour did in government.

For gender issues in general, the UK ranks 18th in the world – behind the Philippines and Nicaragua. Within this context it is shocking that the UK government takes such a laissez-faire approach towards the systematic under-payment of, and discrimination towards women.

So the air will be laden with irony in the Lords this evening, as we finish the debate on EPAs and move on to consider the ‘regret motion’ brought by former Commons speaker, Betty Boothroyd. The motion regrets that the Prime Minister is paying his Leader in the Lords - a woman, Tina Stowell –less than the man who preceded her in the job, Jonathan Hill. 

If a female Leader of the Lords is paid less than her male counterpart, what hope is there for those out in the real world, be they hairdresser, stockbroker or dinner lady? One thing's for certain: that coach and horses will be trampling around Parliament tonight.

Baroness Oona King of Bow is a Shadow Equalities Minister in the House of Lords

Published 28th July 2014

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