Frequent readers of the didlaw blog will know that we regularly focus on issues relating to inequality and discrimination in society and how this permeates through to the workplace. Disadvantage and less favourable treatment in employment can have such an impact on one’s career, mental health and earnings ability. The data remains of concern despite anti-discrimination laws being in place in England and Wales for decades. The good news for the didlaw blogger, however, is that we are never short of a current story to focus on, even in 2021.
It will therefore come as no surprise to many that the gender pay gap remains alive and well.
The latest headline focused on new research that female directors at the UK’s biggest companies are still being paid far lower than their male counterpart. According to research published by New Street Consulting Group last week, the average pay cheque for FTSE 100 female directors is £237,000 which is a quarter of the £875,900 paid to their male counterparts. A quarter! Put another way, for every hour a male FTSE director works, his female counterpart has to work four to achieve the same level of remuneration. This group of employees therefore represents among the largest gender pay gap among all industries and levels.
The good news is that the number of female directors at the FTSE 100 firms has surged by 50% in the last five years resulting in 34% of board roles now being held by women. But why the huge pay gap? One explanation provided for this is that the majority of female directors at UK FTSE 100 companies are holding non-executive jobs which attract lower salaries than the executive ones. Nevertheless this headline shouldn’t just pass us by without some focus from government and businesses alike.
Claire Carter, director at the New Street Consulting Group, commenting on how the inequality could be addressed said “the key to doing that will be ensuring that women have more executive responsibilities and are trained and prepared properly for taking on that responsibility. It will be a case of examining whether there are any barriers that are preventing females from reaching the very top at their organisation.”
It has been more than 50 years since the introduction of equal pay legislation in the UK but there remains a significant gap in earnings between men and women. Research published earlier this year by the Office for National Statistics shows that whilst the gender pay gap is decreasing in general, this remained at 18.1% in 2016.
There are likely to be many reasons for this – pregnancy and maternity, challenges for working mothers, obstacles relating to career progression, discrimination, or other factors such as personal choice. This is a constant topic of speculation, discussion, and controversy.
Since 2017 larger employers have been mandated to publish an annual report containing data on their gender wage gap. Reports from the 2019 data revealed that eight out of 10 British companies paid men more than women. In view of the COVID-19 pandemic, the government suspended the requirement for reporting in 2020 and 2021 to alleviate any additional pressure on businesses. As a result, only a quarter of UK companies who are normally obliged to report did so in April this year. Such a suspension on reporting and the lack of transparency on the gender pay is likely to mask inequality and delay progress in this area.
Mandatory reporting on the gender pay gap is expected to resume from October 2021 and we await the data with interest. This is important for all women, especially those on lower salaries struggling to make ends meet. Whilst those on healthy 6 figure salaries are unlikely to face the same financial challenges, the gender pay gap needs to be tackled from all angles and across all industries and levels. If we can’t tackle such discrimination in the boardroom, allowing the old boys club to continue to flourish, how are we likely to achieve any equality elsewhere?
This blog is by Caroline Oliver, Senior Solicitor, didlaw.
