28 Oct 2014

Here’s why there’s every reason to get radical on equal pay

It’s not often that Rwanda’s record on women’s rights surpasses Britain’s. But, shamefully, when it comes to the gender pay gap, the UK has been deemed a worse place to be female than African countries like Burundi and Rwanda.

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Figures from the World Economic Forum show Britain slipping far down the league table to a humiliating 26th place.

Surprised? You shouldn’t be.

We’ve known for a while that women here get paid less than men (20 per cent, on average), and progress has been depressingly slow. Companies have been under pressure for a while to up their game, but few seem to be doing any more than paying lip service to a desire to solve the problem.

I remember aeons ago, when I was working for the Financial Times, I discovered that a male reporter the same age as me but in a more junior role was getting paid £10,000 more than me. I challenged the boss class, and was told “you don’t have a mortgage or a family”. (Neither did my male colleague, by the way, but that hadn’t held him back.) The look of astonishment on my face was enough to secure me the pay rise.

But it seems that since then little has changed – and it’s a problem that permeates British society.

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David Cameron was content to pay a female cabinet colleague – Baroness Stowell of Beeston – £22,000 less than her male predecessor. So maybe the absence of women in parliament is part of the problem. According to figures from the Inter-Parliamentary Union, Rwanda comes top on that, with 51 per cent of its parliamentarians female, by contrast with the UK, in 64th place, with just 22.6 per cent.

There’s every reason, then, to get radical. Labour and the Liberal Democrats now want to force big firms to reveal their pay gap, in the hopes that naming and shaming them will finally effect change. Under the last government, section 78 of the equality act required companies employing more than 250 people to publish pay details, but the coalition junked that line in the legislation, so women have no way of knowing if they’re getting underpaid.

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From my experience, the voluntary approach now in operation doesn’t seem to be working. I did a ring round of top banks to find out about pay bands for their female staff. Not a single one was able to answer my questions, although Nomura helpfully pointed out that disclosing pay was not a legal requirement under the equality act.

Banks and other companies will continue to hide behind the law until it changes. In response to the figures from the World Economic Forum, the women and equalities minister Nicky Morgan said: “We are committed to delivering a long-term economic plan that works for everyone.” Fair enough, but maybe it’s time she also caught up with Labour and the Lib Dems on the need for transparency.

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