Companies that are failing to address the gender pay gap will be highlighted in new league tables as part of plans to be unveiled by Women and Equalities Minister Nicky Morgan today.
Building on the Prime Minister’s pledge to end the gender pay gap in a generation, Nicky Morgan will today announce that the government is pressing ahead with legislation to force companies with over 250 employees to publish their gender pay gap data, and taking action to make sure that thousands more girls are studying STEM (science, technology, engineering and maths) subjects at school.
The moves are all part of the government’s plan to secure real equality for women and further reduce the pay gap – making sure they have the skills they need to get into highly paid professions – and are rightly paid properly when they get there.
On top of the plans announced by the Prime Minister last year (to force companies with over 250 employees to publish their gender pay gap and bonus pay gap details), Nicky Morgan will announce that the government is going even further by forcing companies to publish how many women and men are in each pay range. To highlight where the gap needs tackling, the government plans to publish the pay gap by sector – in a league table that will allow women to see where the gap is being addressed and where more action must be taken.
Minister for Women and Equalities Nicky Morgan said:
In recent years we’ve seen the best employers make ground breaking strides in tackling gender inequality. But the job won’t be complete until we see the talents of women and men recognised equally and fairly in every workplace.
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.
At the same time I’m calling on women across Britain to use their position as employees and consumers to demand more from businesses, ensuring their talents are given the recognition and reward they deserve.
Today’s announcements come after a consultation on requirements for employers to publish their gender pay gap. Today the government will be pressing ahead with the plans by laying draft regulations to make sure they come into force as soon as possible.
New legislation to make employers publish their gender pay gap
In addition to publishing their average gender pay gap and bonus pay gap, around 8,000 employers across the country will have to publish the number of men and women in each pay range – to make clearer than ever where the pay gap is at its worst and needs to be tackled.
Every employer must also publish their gender pay gap on their website – so employees and consumers can see the scale of the problem. Companies will have to report every year, and senior executives will be expected to personally sign this off.
Funding to help businesses introduce the new regulations
The government is announcing a new £500,000 support package to help companies implement the regulations, including UK-wide conference events, free online software, targeted support for male dominated-sectors such as STEM, and the publication of a report highlighting those business trailblazing in this area.
Government plans to shine a light on sectors not closing their gap
The government will recognise those employers making progress to close the gap and those that are not by publishing a league table of the pay gap by sector. The first official publication is set to be in 2018. The tables will help women see how sectors compare and will help make sure that employers that are not taking action do so.
Work to get thousands more girls into the careers where the gap is still too big
With just 24% of girls’ entries to A levels being in maths and sciences compared to almost four in ten for boys, and the gender pay gap in sectors such as engineering among the worst across business, the government is taking action to tackle the root causes that stop girls entering careers in these well-paid sectors. This includes an ambition to see 15,000 more entries by girls to maths and sciences by 2020 – around a 20% increase on current numbers.
A new ministerial group spanning the whole of the UK to look at addressing the pay gap and better opportunities for women
The Sawers Review on the role of women in the Scottish economy advocated a more joined up approach to drive equalities forward. The ministerial group will look at how the government supports women into work and help them to progress once there through sharing data on equalities, sharing learning and evidence of what works well and less well, and engaging business, the third sector and civil society.
Ann Francke, Chief Executive of the Chartered Management Institute said:
Publishing league tables will drive diversity, bringing benefits not just to women but to business. Closing the pay gap will open the talent pipeline, increase management quality and boost productivity.
Also announced today are plans to expand the Women’s Business Council to ensure every sector is represented. The seven new members represent key sectors such as energy, defence, engineering, manufacturing, construction and media and television across the UK.
This work builds on decisive action this government has already taken to help women in work. The fact is, women remain far less likely to enter senior positions, often as a consequence of taking time out to have children. That is why we have taken steps to help parents combine a career with their family, including the introduction of shared parental leave, the right to request flexible working and delivering on our commitment to provide 30 hours of free childcare to working parents of three- and four-year-olds – with some areas set to receive the free offer as soon as this September.
The government has also published its response to the Sawers Review on the role and contribution of women in the Scottish economy which includes the establishment of a new cross-government Devolved Administrations Working Group.
Notes to editors:
For more information please call Press Office on 020 7783 8300.
The government received nearly 700 responses to its first consultation on the gender pay gap with overwhelming support for the implementation of the new rules.
To make sure we narrow the gap further and faster, employers could be expected to calculate their pay gap from as early as April 2017 with the first official publication being in April 2018.
Additional stakeholder quotes can be found below.
David Sproul, Senior Partner and Chief Executive at Deloitte UK, said:
Today’s announcement is an important step in achieving greater gender parity, for pay and representation, at all levels within big businesses. Being able to access information about a company’s gender pay gap will enable people to make better informed decision about potential employers, while companies will also be able to consider gender pay when selecting suppliers.
At Deloitte, we are open and transparent about the issues we face in tackling gender diversity. We reported our gender pay gap last year and, looking across our organisation as a whole, our gender pay gap stands at 17.8% (around 1.3% below the national figure). However, within each grade the pay gap is significantly lower, at 1.5% on average. This illustrates that for Deloitte, the issue is far less about how we pay our people and more about the number of women employed at more senior grades. In FY14, we set an ambition that 25 per cent of our partner group would be women by 2020 and 30 per cent by 2030 and we are clear as to the steps that we need to take to achieve that.
Pay parity is one part of the equation; we also understand that achieving meaningful and sustained change will need a combination of culture change and targeted actions. So alongside programmes such as our Return to Work Internship for women who have been out of the workplace but wish to re-enter it, we have been working hard to ensure that we provide a working environment that enables women to balance a successful career with family life. We are midway through our journey, but reporting our gender pay gap has helped us to make progress.
Geof Stapledon, Vice President Governance at BHP Billiton said:
At BHP Billiton, we take gender pay bias seriously and we fully support transparent reporting of gender pay gaps, as our experience shows that those items that get measured and disclosed are better understood and acted upon. We believe there should be a focus on disclosing gender pay gaps for total pay as, while base salary will always be important, bonuses are a key part of the way pay is structured in the modern world.
Neil Murray, regional Chairman for Sodexo UK & Ireland said:
Sodexo fully supports gender pay transparency and is committed to publishing a breakdown of our gender pay gap variances and addressing any unjustifiable discrepancies. Our internal research reinforced the business case that gender balance in management positions results in better performance across a range of measures.