There have been a lot of new stories and discussions recently surrounding the UK gender pay gap; what it is, what it isn’t and why it matters. This year, just in time for International Women’s Day and for the first time, all public and private sector organisations in Great Britain with more than 250 employees will have to reveal the difference between what they pay men and women. Around 9000 companies and public bodies will have to report their pay and according to the Guardian, as of March 7 2018, 1,187 companies have been revealed as paying men more. Surprised? I reckon it may only going to get worse…time to ready up and make sure you know your stuff on what the gender pay gap is.
What is the gender pay gap?
The gender pay gap is the difference between the median hourly earnings of full-time women and men, with the figure expressed as a proportion of men’s earnings. According to the Office of National Statistics (ONS), the gender pay gap is around 14.1% and has been stuck at that level for three years. The ONS also reported that the median UK gender pay gap was 9.1% in April last year, which meant men were paid on average £1.32 more an hour than women! This figure has fallen dramatically from the 17.4% gap recorded in 1997, the year the ONS began collecting this data, but is still a huge gap. It means that from November 10th every year, women effectively work for free whilst men keep getting paid.
But, isn’t it illegal to pay men and women differently?
Well, under the 1970 Equal Pay Act, men and women in the same workplace must be given equal pay for equal work. The gender pay gap, however, takes all pay into account regardless of the roleor workplace. So what that means is, a company would have a gender pay gap if the majority of the high paid roles went to men, or if more of the women worked part-time.
Why does it matter?
The UK gender pay gap matters because it is a reflection of the inequalities and discrimination present in the labour markets which affects both men and women and impacts on how families operate, too. A report from PwC notes that closing the gender pay gap in the UK could boost women’s wages by £90bn and increase women’s annual wages by £6,300 a year.
The gender pay gap means that women are more likely to experience gender-based discrimination surrounding pregnancy, maternity leave, and childcare with reports showing that one in nine new mothers is dismissed, made redundant or unfairly forced out of their role, according to the Equality and Human Rights Commission. Low skilled and part-time roles also have a higher proportion of women, with just 8% of skilled trade roles being filled by women. As a result, women not only earn less than men, but they also experience less progression in their careers. The ONS noted the pay gap for 22-29-year olds is 2.2% compared to a huge 16.2% for 50-59-year olds. Furthermore, a man who has worked for a company for 1 year will earn 5.3% more than his female colleagues, but this will jump to 11.9% after 20 years! All this means that women are more likely to fall into poverty or financial difficulty, particularly in later life.
Why does the gender pay gap exist?
There are a number of reasons that people don’t believe in the gender pay gap. One argument is that both genders often have comparable starting salaries and that the pay difference over time is explained by differences in education and experience. Others suggest that women actively choose low skilled or flexible roles, and so are not victims of discrimination. And, some argue that the gender pay gap is insignificant in comparison to ethnic pay gaps, which studies suggest is as high as 37% between white and ethnic minority workers. A large body of statistical evidence, however, suggests that there is a gender pay gap in the UK.
What can I do?
The government has introduced legislation which requires companies with 250+ employees to publish annual gender pay data to improve the visibility of the UK gender pay gap. This information will soon be publicly available, and it is hoped the increased scrutiny will encourage employers to close the gap. You can use this information to start a conversation about gender pay with your colleagues and employer, if you want to raise issues. The Fawcett Society, a charity campaigning for gender equality and women’s rights, suggests asking your employer about your company’s pay gap, asking for flexible working hours or discussing pay with your male colleagues. You can also campaign with the charity for new measures including penalties for employers who do not report their gender pay gap, targets for apprenticeships, increased maternity leave and extended free childcare. Speak up, share information and hopefully, we’ll close this gap in the near future.
Originally written for and published by GoThinkBig.com.