Companies could face court over failing to report gender pay gap
Head of Equality and Human Rights Commission says firms which miss 4 April deadline would be named and shamed
The head of Britain’s equality watchdog has warned companies that they could be pursued through the courts if they fail to report their gender pay gap.
Issuing a stark warning to the 5,000 companies that have yet to provide data on the difference between the amount they pay male and female employees, Rebecca Hilsenrath, chief executive of the Equality and Human Rights Commission, said those that failed to make the deadline on 4 April “can’t row back” and would be named and shamed.
For the first time this year, all companies and public bodies with more than 250 employees are legally obliged to publish their gender pay gap, their bonus pay gap and to reveal the proportion of men and women in each quartile of their business.
“Let me be very very clear: failing to report is breaking the law,” Hilsenrath said. “We have the powers to enforce against companies who are in breach of these regulations. We take this enormously seriously. We have been very clear that we will be coming after 100% of companies that do not comply.”
Around 3,700 companies have revealed their gender pay gap on the Government Equalities website, but with only 10 days before the cut-off around 5,300 are yet to do so. Hilsenrath said 25% of the 9,000 companies that by law must report their gender pay gap before the deadline had yet to register to do so.
The EHRC will immediately write to companies that do not make the deadline. Those that continue to avoid the statutory requirement could ultimately face a summary conviction, an unlimited fine and be forced to publish the data under a court order.
“If that happens it will be the case that the company has been found to be in breach of the law and you won’t be able to row back from the publicity of that fact once the deadline has past,” said Hilsenrath.
Asked whether companies would be named and shamed, Hilsenrath said: “There will be a list and this is will made public. We will be conducting a statutory investigation and that requires us as a matter of law to publish the terms of reference. So this is going to be very public and there won’t be any way to hide the figures. Whether they are all published on the same day as 7,000 other people it won’t get you out of the problem.”
A spokeswoman for the Government Equalities Office said she could not confirm whether a list of companies that fail to make the deadline would be made public on the government portal.
Hilsenrath said she was confident that the majority of companies would publish, comparing the delay to the last-minute rush to file tax returns. But when asked if she had a message for companies who had not yet filed, she said: “It’s the law, don’t break it – just like you wouldn’t break any other law. Secondly I would say stop wasting your money talking to consultants who might be advising you about legal loopholes. It’s an ill-informed and ill-judged gamble.”
She added: “But above and beyond all of that, I would say – look at the women who work for you and ask yourself if they don’t deserve a better deal. There is a huge moral element to this. We as a society know that there are legal and social implications for the fact that half the human race is responsible for giving birth for the continuation of the human race. Lots of the people running these organisations have daughters. It’s not good enough.”
The pay gap reporting requirement has already revealed significant discrepancies in the differences between the amount men and women get paid in industries from finance to beauty, and shone a spotlight on how men dominate the highest-earning senior roles in many companies.
In banking, HSBC’s median pay gap was 29% and bonus gap 61%, Barclays International revealed a 43% pay gap and 73% bonus gap, while at Goldman Sachs the figures were 36% and 67% respectively.
At L’Oréal, where 69% of the workforce are female, the figures were 32% and 35%, with men holding 70% of senior roles. In education, the Guardian’s analysis of data has revealed that at a string of multi-academy trusts women face median hourly pay deficits of more than 50%, with the median gap above the national average in the majority of cases.
Hilsenrath said the requirement was “a really important endeavour” which had revealed that the UK was not doing “quite as well as we thought”. She said the government and companies had to focus on action to tackle the gender pay gap.
“I think this is a very welcome light being shone on a problem that we know has existed for a very long time,” she said. “But I think the most important thing is how businesses react to those pay gaps, how many of them take proper action to address them.”