Proposed legislation will also cover public sector
From next year, employers will be required to include information about bonuses awarded to men and women, in their compulsory gender pay gap reports, under new measures announced by the government this week.
The proposals to compel large companies to reveal the difference in pay for male and female employees in their organisation will also be extended beyond private and voluntary sector employers, to include the public sector, Prime Minister David Cameron and women and equality minister, Nicky Morgan, have announced.
The new measures aim to eradicate gender inequality in the workplace and remove barriers to women’s success, the government said in a statement.
Morgan added that the government would also work with businesses to eliminate all-male boards in the FTSE 350.
Earlier this year, UK organisations hit Lord Davies’ 25 per cent target for women on boards. He is now preparing his final report which will include recommendations for achieving gender equality in the workplace.
Ann Francke, chief executive of the Chartered Management Institute (CMI) said: “Bonuses are where gender bias can creep in easily as they are amongst the least transparent forms of pay.”
“There’s a tendency to reward those in our own image or to think that because men may be the ‘main breadwinners’ they deserve higher bonuses. And men often negotiate harder or trumpet their achievements more readily,” she added.
“Clearer employee data, improved recruitment and a reinvigorated focus on business culture will help unblock the talent pipeline and support more women to become senior managers and leaders,” Francke said.
The pay gap between men and women is currently 19.1 per cent, the narrowest it has been since records began in 1997. But the UK still lags behind its European counterparts, according to reports.
Results of a consultation on how, when, and where gender pay data should be published is expected by the end of the year, but Neil Carberry, director for employment and skills at the CBI said reporting should be bespoke to each company to stop it becoming a “box-ticking exercise.”
“To continue progress, we need to challenge occupational stereotypes by encouraging more women into male dominated industries and strengthening careers advice,” he said.
Frances O’Grady, TUC general secretary added: “Employers need to look at why women are still being paid less than men and do something meaningful about it.”
She said mandatory pay gap reporting should be extended to medium-size companies and organisations that don’t comply should be fined.
Kathryn Nawrockyi, gender equality director at Business in the Community (BITC) welcomed the added “rigour” of the government’s new measures.
“Extending plans for compulsory gender pay gap reporting to include private, public and voluntary sectors will go some way towards to illuminating the impact occupational segregation has on women’s pay,” she said.