Equal pay is still far-off for Britain, where the gender gap narrows at a glacial pace
New disclosure rules and more free childcare are to be welcomed, but the government must do more to ensure women earn the same as me…
Here we go again. The Equal Pay Act was introduced 46 years ago and yet from Thursday this week the UK’s female workforce will effectively be working for free until 31 December, due to the scale of the gender pay gap.
This year’s “equal pay day”, which highlights the difference between men’s and women’s salaries, is only one day later than it was last year. This reflects the glacial pace of change in reducing the gulf between the genders in earnings.
Average pay for full-time female employees is still 9.4% lower than for full-time male employees, according to the latest official figures. That gap is only slightly better than the 9.6% recorded in 2015 but at least an improvement on 17.4% back in 1997.
Women continue to be penalised with lower pay and fewer promotions when they return to work after taking time away to care for children and because they tend to work in jobs with lower salaries, such as caring and administration. There is also a penalty for working part-time where pay, on average, is less per hour than in full-time work. And a far higher proportion of women work part-time – 41%, compared with only 12% of men.
What’s more, when compared with other countries’ records on gender equality, the UK has slipped down the global rankings. It was the ninth most gender-equal country in 2006 but by this year had slipped to 20th place, according to tables compiled by the World Economic Forum.
At this pace, it will take decades to close the gender pay gap. On one estimate, equal pay will finally be achieved 99 years after the 1970 Equal Pay Act was enacted.
That’s bad news for a government that has vowed to close the gap within a generation.
To be fair, ministers have made some encouraging noises and even some meaningful changes. They include flexible parental leave and the national living wage, of which two-thirds of recipients are women.
The government is also increasing the amount of free childcare on offer to working parents and – in a bid to put pressure on employers – from April next year all those with more than 250 staff will have to publish their gender pay gap. There are also moves to get more women on boards.
Even so, rather than celebrating the latest marginal improvement in the pay gap, as ministers did when the figures came out, it is time to come up with more radical moves to stamp out workplace discrimination, support women’s careers and get more young women into higher-paying sectors.
At the moment, girls and boys are let down by inadequate careers advice, and when they get into the workplace they are let down again by a chronic under-investment in training that traps far too many people in low-paying, low-skilled jobs.
In placing employers under more scrutiny, the new rules in April should be helpful. But it is not enough to name and shame the worst offenders. Workers need more means to challenge those inequalities. Companies must be made to explain themselves.
The government could start by scrapping the tribunal fees that stand in the way of many women getting justice from employers who have discriminated against them.
In most cases, the pay gaps that come to light under the new disclosure rules next year will be down to the usual factors of more men than women being in the top jobs, as opposed to outright discrimination and men earning more than women for the same work. But if we accept those differences in seniority, we might as well give up on hopes of closing the pay gap. Instead, offending firms should be made to re-assess how they train and promote people, how they hire new staff and what kind of flexibility they offer.
Theresa May called for gender equality when she set out her pledge for a “Britain that works for everyone”. If she meant it, she must get tough on Britain’s stubbornly wide pay gap.
Green hardly the one to rule on BHS pension
Five months ago, the Guardian newspaper wrote that the BHS scandal was not about the failure of capitalism but the failure of people to recognise their basic moral duties.
Last week, as the Pensions Regulator started formal legal proceedings against Sir Philip Green and Dominic Chappell, the former owners of BHS, that statement is as pertinent as ever.
There has been much debate about how much Green has offered the regulator to support the BHS pension scheme, which has a deficit of £571m.
But really this does not matter. The Pensions Regulator is the organisation best placed to rule on how to financially support an ailing pension scheme – the key is in the name. Yet, Green cannot bring himself to meet the watchdog’s demands and is proposing a complex deal that would involve the BHS pensions becoming part of a new pension scheme that is not secured by a sponsoring company.
The billionaire promised to “sort” the problems facing the BHS pension scheme, but we are still waiting for a settlement. It is now clear Green wants to “sort” it on his terms, but as the size of the BHS deficit shows, he is not the ideal person to be dictating the terms of a pension rescue.
The Pensions Regulator and its boss, Lesley Titcomb, are fighting for their future after the criticism they have received because of the BHS scandal. This, and the febrile political atmosphere around Green, add an extra dimension to their work. But at least their remit is focused on getting the best deal for BHS pensioners, who will ultimately have to pick up the bill if it enters the Pension Protection Fund, funded by a levy on other schemes.
That is why the regulator is right to press ahead with formal action against Green, even if it could take years to resolve. In the meantime, hopefully Green will face up to his responsibilities to the 11,000 BHS workers who lost their jobs and agree to the regulator’s demands. It should not be forgotten that while they have lost their jobs and some retirement benefits, Green has only lost his reputation.
M&S faces bitter conflict on store closures
Get ready for a brutal battle between Marks & Spencer, MPs and trade unions. The high street retailer clashed with politicians and union leaders when it tried to make changes to pay and pensions, but wait and see what happens when it announces next week that is closing dozens of shops and downsizing its clothing offer in others.
M&S may no longer produce the lucrative profits it did in its heyday in the late 1990s, but its shops are still the bastion of high streets across the country. Each of its shops can employ more than 100 people, and they offer towns a reliable collection of high-quality food and clothing.
So, when M&S proposes shutting a shop it is a big deal. The company tried to close nine last year, affecting 430 workers, sparking petitions and rows in places including Aldershot in Hampshire.
Steve Rowe, the M&S chief executive, is right to take action – the company has way more shops and retail space than its rivals. But M&S is a British institution, and he won’t find this an easy task.