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An overview of the gender discrimination in the workplace

United Kingdom February 7 2018 More than ever, issues of gender equality and pay and sex discrimination in the workplace are at the forefront of public consciousness. Against the backdrop of significant momentum behind the MeToo movement and other gender equality campaigns in the United Kingdom and elsewhere, we take a look at some of the key themes around women in the UK workplace, the legal framework currently in place, and proposals for change. In the UK, we have witnessed in the press the widespread condemnation of the Presidents Club following serious an overview of the gender discrimination in the workplace of harassment at their recent fundraising dinner.

The focus is turning now to companies reporting their gender pay gap, with a 4 April 2018 deadline looming for private sector and voluntary employers with 250 or more employees 30 March 2018 for public sector employers to publish their reports. In the current climate, and particularly in light of the abolition of employment tribunal fees in the UK last summer, allegations and claims of harassment and discrimination whether explicit or unconscious are likely to be made against many employers in the coming months and years.

Whilst the Fawcett report acknowledges that significant progress has been made toward gender equality, it emphasises that much remains to be done. The report provides a comprehensive review of current sex discrimination laws, focusing on the areas of pay, family friendly rights, workplace harassment, violence against women, and access to justice.

The Fawcett Society advocates introducing civil penalties for noncompliance with gender pay gap reporting and enhancing the powers and resources provided to the Equality and Human Rights Commission EHRC to carry out enforcement activity to provide a more immediate impact on companies that are noncompliant with the Gender Pay Gap Reporting Regulations. Fawcett also recommends that the regulations be amended to break down the gender pay gap by age, disability, ethnicity, sexuality, and part-time status and that by 2020, the regulations should apply to employers with more than 50 employees.

The report further recommends the reintroduction of Equal Pay Questionnaires and the introduction of mandatory equal pay audits every three years for employers with over 250 employees. In respect of workplace harassment, the report suggests the reintroduction of Section 40 of the Equality Act 2010 to guarantee legal protection against harassment by third parties, and the extension of protection from harassment under Section 26 5 to pregnancy and maternity as well as marriage and civil partnership status.

Whilst some critics of the report have questioned the practicability of implementing a number of its recommendations, the report undoubtedly contributes to the discussion on gender equality in the workplace and progresses the conversation about equality more broadly.

Employers should be prepared for further changes to the legal and enforcement framework and should ensure that the issue of equality remains an important topic on board agendas. Many big names such as Deloitte, Airbus, and Weetabix have already published, but a significant majority have yet to do so. To date, limited data has been reported by the banking sector, where it is estimated that the pay gap is significantly higher overall than the national average gap of 17.

However, in its narrative, the bank makes a case for the positive gender diversity initiatives it is implementing and the progress it intends to make. In the retail sector, the reports published demonstrate even greater hourly pay gaps.

Madeline E. Heilman and Suzette Caleo

One fashion retailer has reported a 64. At the snapshot date, the retailer employed 1,710 female employees and 44 male employees. Of the 44 male employees, 39 were employed in the corporate head office.

  • Notably, the Financial Times has already analysed data reported by companies to date, querying statistics published which seem improbable;
  • This data will no doubt be used by employers to demonstrate their commitment to equal opportunities for other purposes, including in response to pitch opportunities and requests for proposals RFPs;
  • The EHRC will initially focus its enforcement work on employers which fail to publish the information required by the regulations;
  • In the current climate, and particularly in light of the abolition of employment tribunal fees in the UK last summer, allegations and claims of harassment and discrimination whether explicit or unconscious are likely to be made against many employers in the coming months and years.

By removing corporate staff from the gender pay gap calculation, the company was able to demonstrate that it has a negative gender pay gap i. In the pharmaceuticals industry, few employers have yet published. One prominent company in the sector reported a 10.

  1. The report provides a comprehensive review of current sex discrimination laws, focusing on the areas of pay, family friendly rights, workplace harassment, violence against women, and access to justice.
  2. The EHRC will initially focus its enforcement work on employers which fail to publish the information required by the regulations.
  3. Clarity from the EHRC on its proposals in this regard would be welcome.
  4. Once again, it is difficult to see how the EHRC will be able to assess the accuracy of information published by any particular company without exercising its investigative powers in the first place. Helping employees and potential future recruits to understand the pay gap and encouraging them to participate in related initiatives also will be of critical importance in procuring employee engagement, reducing the potential for complaints and employee turnover, and mitigating the risk of potential claims.

Notably, the Office of National Statistics ONS has concluded in new analysis published on 17 January 2018 that, contrary to popular belief, the majority of the gender pay gap in the UK cannot be explained by differences in characteristics between men and women and the types of jobs that they do.

The study focuses on the median rather than the mean gender pay gap and finds that only one-third of the pay gap can be attributed to observable differences in the characteristics of men and women and the jobs they do—such as differences in average age, job tenure, company size, and occupation. With regard to the unexplained remainder, the ONS states that more analysis is needed on family structures, education, and career breaks.

  • However, in its narrative, the bank makes a case for the positive gender diversity initiatives it is implementing and the progress it intends to make;
  • As a further step, if it has capacity to do so, the EHRC intends to take enforcement action against employers for publication of inaccurate data;
  • Any pay disparity identified should be investigated and measures taken to address inequality before claims arise;
  • Fawcett also recommends that the regulations be amended to break down the gender pay gap by age, disability, ethnicity, sexuality, and part-time status and that by 2020, the regulations should apply to employers with more than 50 employees;
  • The study focuses on the median rather than the mean gender pay gap and finds that only one-third of the pay gap can be attributed to observable differences in the characteristics of men and women and the jobs they do—such as differences in average age, job tenure, company size, and occupation.

Until that is done, the ONS stresses that the unexplained element should not be interpreted as a measure of discriminatory behaviour although it concedes that this may play a part. The draft policy sets out a range of activities that the EHRC plans to undertake, including promoting awareness and educating employers, monitoring compliance in conjunction with the Government Equalities Office, and publishing compliance rates.

It also intends to resolve noncompliance through informal resolution where possible, followed by formal enforcement action where necessary.

This will range in escalation starting with investigations, followed by the seeking of formal agreements and, where agreement is not ultimately reached, proceeding to unlawful act notices. The EHRC will initially focus its enforcement work on employers which fail to publish the information required by the regulations.

However, it is unclear exactly how the EHRC intends to identify in-scope companies which have not reported. Whilst in many cases it may be obvious, there will be hundreds of employers which hover around the 250-employee mark which may be in or out of scope depending on entity structure and employment relationships. It is difficult to see how the necessary information to allow the EHRC to assess whether an employer should be in scope will be accessible to the EHRC without the Commission using its investigative powers, which, based on the current proposals, are only available after the informal resolution stage.

As a further step, if it has capacity to do so, the EHRC intends to take enforcement action against employers for publication of inaccurate data. Once again, it is difficult to see how the EHRC will be able to assess the accuracy of information published by any particular company without exercising its investigative powers in the first place.

Clarity from the EHRC on its proposals in this regard would be welcome.

  • The focus is turning now to companies reporting their gender pay gap, with a 4 April 2018 deadline looming for private sector and voluntary employers with 250 or more employees 30 March 2018 for public sector employers to publish their reports;
  • Whilst the Fawcett report acknowledges that significant progress has been made toward gender equality, it emphasises that much remains to be done;
  • Any pay disparity identified should be investigated and measures taken to address inequality before claims arise.

Notably, the Financial Times has already analysed data reported by companies to date, querying statistics published which seem improbable. The potential impact on reputation and brand as a result of such public scrutiny is therefore as significant as the risk of potential enforcement measures.

This should act as an added incentive for employers to ensure that the data they publish is accurate and stands up to scrutiny. Broader Impact on Businesses Whilst Fawcett focusses heavily on enforcement and the need for the law to be progressive in relation to equality, it does appear that most of the employers which have already published gender pay gap statistics understand the broader impact on their businesses—particularly in relation to company brand, pipeline talent, employee engagement, and business growth.

Of the companies that have published reports to date, most have taken the opportunity to educate readers—who will include employees, clients, customers, and shareholders—on the difference between unequal pay and the gender pay gap, emphasising that the latter is due to unequal distribution of men and women in the workforce as opposed to any element of direct discrimination.

Many have also an overview of the gender discrimination in the workplace in the narrative to set out details of efforts being undertaken to address and close the gap and to measure and report progress on an ongoing basis.

This data will no doubt be used by employers to demonstrate their commitment to equal opportunities for other purposes, including in response to pitch opportunities and requests for proposals RFPs. Helping employees and potential future recruits to understand the pay gap and encouraging them to participate in related initiatives also will be of critical importance in procuring employee engagement, reducing the potential for complaints and employee turnover, and mitigating the risk of potential claims.

Watch This Space Whilst we are able to identify some themes from the reports published to date, it is clear that most employers are waiting until closer to the reporting deadline to publish their reports. These companies are likely planning to assess the trends emerging from employers which have released their statistics early, in order to learn from what and how early reporters published.

UK Diversity Matters: The Gender Pay Gap and Gender Equality at Work

We are expecting to see a significant increase in activity in the weeks running up to the deadline and will issue further updates as more data is published. Also likely to gain momentum is the Fawcett report and its recommendations. Whilst lacking the direct ability to change the law, the report is well timed to benefit from the momentum of rising media interest in sexual harassment, equal pay, and other important equality issues. For employers, prevention is better than cure. Any pay disparity identified should be investigated and measures taken to address inequality before claims arise.

Policies dealing with harassment and discrimination should be reviewed and enforced, with regular training given to employees.