07 April 2017

Gender Pay Gap reporting came into force yesterday (06 April 2017), requiring employers with 250 employees or more to publish figures on how much they pay female and male staff by April 2018.

The gender pay gap is currently at 18.1% and has been slowly reducing, but the Fawcett Society has reported that if it continues to narrow at its current rate, parity will not be seen for another 60 years.

Around 9,000 employers and more than 15 million employees – almost half of the UK's workforce – will be covered by the new regulations, which require organisations to publish their median gender pay gap, their mean gender pay gap, the proportion of men and women in each quartile of their pay structure, and gender differences in any bonus payouts.

Employers will be encouraged – but not required – to publish an action plan as to how they will improve their figures alongside the data. Moreover, there are no sanctions for employers who do not abide by the new laws.

If the gender pay gap were eliminated completely, it is expected £150 billion would be added to annual GDP by 2025, according to government figures.

Minister for Women and Equalities Justine Greening said: "Helping women to reach their full potential isn’t only the right thing to do, it makes good economic sense and is good for British business."

While the Institute of Employment Rights welcomes the move towards transparency over gender equality within the economy, we call for more strident policies to be put in place to hasten the elimination of the pay gap.

In our Manifesto for Labour Law – 25 recommendations for reform, the principles of which have been adopted by the Labour Party – we call for stronger trade union rights, and equality representatives in the workplace, to encourage employers to take action against the gender pay gap rather than just reporting on it.

As the TUC said in this week's blog on the subject, sectoral level bargaining – which the IER proposes in its Manifesto for Labour Law – is a robust means to raise poor pay in female-dominated sectors such as carework.

Click here to read more about the Manifesto for Labour Law and purchase your copy