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By Ali Qassim
March 3—British companies with more than 250 employees will be required to publish their gender and bonus pay gap details under new laws the government plans to introduce by October, Education Secretary and Minister for Women and Equalities Nicky Morgan announced Feb. 12.
The plans to introduce Gender Pay Gap Information Regulations 2016 in the Equality Act 2010 follow majority support among the 700 responses to a consultation—a call for public comment–launched last year.
According to the Office for National Statistics' latest annual survey of earnings (based on data though April 2015), men working full-time earned an average 567 pounds ($823) a week and comparably employed women 471 pounds ($683), a 17 percent gap. Among the top 10 percent of earners, the pay gap is 20 percent.
“That’s why I am announcing a raft of measures to support women in their careers from the classroom to the boardroom, leaving nowhere for gender inequality to hide,” Morgan said.
The Government Equalities Office, which Morgan heads, also unveiled plans to publish data breaking down the pay gap by sector and showing which companies are addressing the gap and which need to do more.
Under the proposed draft regulations, an estimated 8,000 employers representing the largest businesses will have six months from the projected October passing of the legislation to prepare a preliminary data snapshot in April 2017.
To ensure employers have sufficient lead time to introduce the necessary systems and processes to analyze their gender pay gaps, release of full data will not be required until April 2018, the Equality Office said. At that time, employers will be required to:
David Sproul, senior partner and chief executive at accounting firm Deloitte UK, which already reports its gender pay data, welcomed the measures, which he said “will enable people to make better informed decisions about potential employers.”
While Ann Francke, chief executive of the Chartered Management Institute, said publishing data by sector and employer “will drive diversity,” Carolyn Fairbairn, director general of business lobby Confederation of British Industry, said that these data “should not be used to name and shame firms.” Data “will only be able to present a partial picture, particularly given factors such as the mix of part-time and full working and sectoral differences,” Fairbairn said.
The Trade Union Congress, which represents more than 5.5 million workers in 52 unions, was “disappointed” that firms have until 2018 to publish their gender pay gap data and warned against employers treating the rules as a “tick-box exercise.” According to the TUC, the full-time pay gap fell by 7.3 percentage points between 1997 and 2010, but the rate of decrease slowed to just 0.7 percentage points between 2010 and 2015.
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The government’s consultation on the Gender Pay Gap Information Regulations 2016 is available at https://www.gov.uk/government/consultations/mandatory-gender-pay-gap-reporting.
For more information on British HR law and regulation, see the U.K. primer.
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