Addressing the gender pay gap: Government and social partner actions – UK
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In 2001 a report into equal pay in the UK found that there had been insufficient coordinated and concerted commitment from employers, trade unions and government. Today there is still disagreement among the social partners as to the underlying causes of the problem. Employers believe that the best way to close the gender pay gap is to remove barriers to equality of opportunity and have resisted calls from the unions for compulsory equal pay audits and greater transparency in pay. But the government’s new Equality Bill will make secrecy clauses unenforceable and enable the government to require employers with at least 250 employees to publish equal pay data.
1. The gender pay gap: national data
1.1. Please provide the reference details (see fact-sheet below), including a brief summary, of the main studies and research on the size and the determinants of the gender pay gap in your country published in the period 1999-2009.
The UK gender pay gap has narrowed steadily between 1997 and 2008, but only by a small amount, fewer than five percentage points.
| National studies on the gender pay gap | Fact-sheet no. |
|---|---|
| Title | The Gender Pay Gap In The UK |
| Authors | Debra Leaker |
| Year of publication | 2008 |
| Bibliographic references | Economic & Labour Market Review, Volume 2:4, April 2008. |
| Link to electronic copy of the report | . |
| Coverage (nation-wide, sectors, occupations, regions, etc: please specify in detail) | Nation wide. |
| Time span (e.g. 1995-2003) | 2007 |
| Data-set (official, ad-hoc survey or study, etc: please specify in detail) | Annual Survey of Hours and Earnings, the Labour Force Survey and the New Earnings Survey panel data set. |
| Type of analyses performed on the data-set (methods, e.g. Blinder-Oaxaca decomposition) | Bi-variate analysis. |
| Main results. Unadjusted gender pay gap (W/M%*): please indicate both levels and trends | Hourly earnings excluding overtime for full time employees. Measure used is median hourly earnings –87.4%.Reduction of the gender pay gap by 0.2% on 2006. Part-time employees: 103.4%. Little change in pay gap over 10 year period. Occupation: Full time women earn less than men in every occupation. Widest pay gap is in male dominated skilled trades major group, such as painters and decorators: 74.6%. Managers and senior officials 77% Professional Occupations: 96.2% Sales and Customer service occupations: 94.1% Part time: Highest paid occupations Skilled trades and occupations: 69.5% Professional Occupations: 95.7% Lowest paid occupations Elementary Occupations: 99.3% Occupations in which women earn more than men Full time – secretarial and related occupations 105.8% Part time – health and social welfare associate professionals 122.5% Age: 18-21 year olds, same on entry. Pay gap emerges after about 10 years. 40-49 year olds: 79.7% 50-59 year olds: 81.7% Educational Attainment: relatively small impact. Narrowest gap at GCSE level 87.3%, widest gap at ‘A’ level: 80.7%, closely followed by those educated to degree level: 81.4% Family Characteristics: Men and women who are not married or cohabiting: 101.1% Men and women who are married or cohabiting 85.5% Number of children in the family: 1 child 87.7% 4 or more children 64.5% Job tenure: 6 months to 1 year in post 98.4% (same figure in 1997 was 85.1%) 2 years or more in post 86.6% 20 years or more in post 91.7% Company size: Full time employees Companies with less than 25 employees: 87.6% Companies employing between 25 and 49 employees: 81.6% Company size: Part time employees Women are more likely to work in companies with less than 25 employees. Pay gap is 88.7%. Women are more likely to earn more than men in larger firms (more than 500 employees) 104.85% |
| Main results. Adjusted gender pay gap (W/M%*): please indicate both levels and trends | |
| Main results. Please list the individual and/or workplace variables taken into consideration in the adjusted gender pay gap (e.g. education, age, seniority, working hours, occupation, region, sector, firm size, etc.) | . |
| Main results. Which ‘institutional’ or policy variables (qualitative or quantitative) have been taken into account in the study? Is there evidence (i.e. in multi-national studies incorporating your country, or when observing a national switch in policies such as, for instance, the introduction of sectoral minimum wages) that certain institutional factors or policies have tended to affect (narrow) the gender pay gap? | The study does not take into account trade union membership or collective bargaining, the main institutional variables in industrial relations. The introduction of the minimum wage resulted in a narrowing of the gender pay gap of nearly 2% between April 1998 and 2000. |
| Main results. The determinants of the gender pay gap: please provide a brief summary | The position of women working full time has improved when compared with full time men. However, the gap varies depending upon: the number of dependant children, type of occupation and company size. Results show that in 1975 the gender pay gap was visible when comparing the hourly earning of men and women from 18 years of age. In 2007 this pay gap was not evident until the age of 34. |
| Main results. Policy recommendations: please provide a brief summary | None |
* Female pay as a percentage of male pay.
| National studies on the gender pay gap | Fact-sheet no. 2 |
|---|---|
| Title | First Release: 2009 Annual Survey of Hours and Earnings |
| Authors | Office for National Statistics |
| Year of publication | November 2008 |
| Bibliographic references | First Release: 2009 Annual Survey of Hours and Earnings, Office for National Statistics, November 2008 |
| Link to electronic copy of the report | . |
| Coverage (nation-wide, sectors, occupations, regions, etc: please specify in detail) | Nationwide |
| Time span (e.g. 1995-2003) | 1998-2008 |
| Data-set (official, ad-hoc survey or study, etc: please specify in detail) | Offical data set |
| Type of analyses performed on the data-set (methods, e.g. Blinder-Oaxaca decomposition) | Frequency Distributions |
| Main results. Unadjusted gender pay gap (W/M%*): please indicate both levels and trends | Median Mean 1999 83.6 79.5 2000 83.7 79.8 2001 83.6 80.0 2002 84.5 79.9 2003 85.4 80.6 2004 85.6 81.9 2005 86.0 82.9 2006 87.2 82.5 2007 87.5 83.0 2008 87.2 82.9 |
| Main results. Adjusted gender pay gap (W/M%*): please indicate both levels and trends | None |
| Main results. Please list the individual and/or workplace variables taken into consideration in the adjusted gender pay gap (e.g. education, age, seniority, working hours, occupation, region, sector, firm size, etc.) | None |
| Main results. Which ‘institutional’ or policy variables (qualitative or quantitative) have been taken into account in the study? Is there evidence (i.e. in multi-national studies incorporating your country, or when observing a national switch in policies such as, for instance, the introduction of sectoral minimum wages) that certain institutional factors or policies have tended to affect (narrow) the gender pay gap? | The study does not take into account trade union membership or collective bargaining the main institutional variables in industrial relations. The introduction of the minimum wage resulted in a narrowing of the gender pay gap of nearly 2% between April 1998 and 2000. |
| Main results. The determinants of the gender pay gap: please provide a brief summary | The stronger growth in full time men’s hourly earnings excluding overtime compared with women’s has meant that the gender pay gap has increased to 87.2% up from 87.5% between 2007 and 2008. |
| Main results. Policy recommendations: please provide a brief summary | None. |
* Female pay as a percentage of male pay.
1.2. Are there any studies published in the 1999-2009 period, possibly using qualitative methods, which investigate the social processes which contribute to determining the gender pay gap through selection, occupational segregation, discrimination, and the like? Is there any research on the development of pay gaps during the life course? Do pay gaps emerge at the beginning of the individual careers of women or do they become significant at later stages of professional development? Because of different gendered career paths or because pay gaps tend to increase as the professional career advances (i.e. higher gaps at higher organisation positions)?
Employment and earnings in the finance sector: A gender analysis. Hilary Metcalf and Heather Rolfe, National Institute of Economic and Social Research. Published by the Equality and Human Rights Commission (EHRC) 2009. ISBN 978 1 84206 112 1
http://www.equalityhumanrights.com/uploaded_files/download__finance_gender_analyis_research.pdf
This study was commissioned by the EHCR to investigate gender discrimination in the finance industry. The Inquiry revealed that for women working as full time employees there was a pay gap of 45%. This compared to the economy-wide gender pay gap of 72%. The research revealed that bonuses are a significant factor behind the gender pay gap, with men receiving five times the performance pay of women, an average of 14,554 GBP in annual performance related pay compared to the female average of 2,875 GBP (based on full-time equivalent earnings). The survey showed that women in new jobs received lower salaries than men. The report highlights how a lack of transparency over pay and working conditions, direct discrimination, long working hours and the difficulties faced by those with caring responsibilities all contribute towards the significant difference between what men and women earn.
1.3. Are there any studies in your country on how gender differentials of pay have been affected by the current economic crisis?
In February 2009, the EHRC and the government announced a joint programme to monitor the impact of the recession. The report concluded that at this stage young people, men and those in deprived areas are suffering the greatest impact, with a cautionary note to the effect that the report is just a snapshot and that the effects of the downturn could easily spread.
2. Government initiatives to address the gender pay gap
2.1. In light of the current economic crisis, has the national government taken any steps to assess and monitor the impact of the current economic downturn on gender pay inequalities? If yes, please briefly illustrate them, including the results of such assessment. Has the government started any initiatives to prevent or address the possible widening of the gender pay gap because of the economic downturn?
The Government Equalities Office ( GEO) commissioned research on the impact of the economic downturn on women and families. 80% of women and 70% of men were concerned about the impact of the economic downturn on their family life. Forty per cent of women and 33% of men were worried about unemployment. Just under half of men and women (48%) said that the downturn had no effect on their working hours. Many women expressed deep-seated concerns about job prospects, the threat of redundancy for themselves and/or their partners, and the pressure both on the individual and the household. Men tended to focus primarily on concerns about job loss per se, not the impact on the family and tended to focus more on who to blame for the downturn.
The government is in the process of introducing an Equality Bill. See 2.2 below.
2.2. Please illustrate the major government initiatives to address the gender pay gap put in place since 2005. Since there is extensive legislation on gender equality, interventions are usually of an indirect nature.
Women and Work Commission
The Women and Work Commission (WWC) brought together employers, unions and experts in a wide range of fields to tackle the problem of the gender pay gap . This resulted in a Government Action Plan to increase the availability of quality, part-time work, introduce a public sector gender duty and to ensure career guidance was free from gender stereotyping, amongst other things.
In 2009 the WWC was reconvened to assess progress. It found that reasonable progress had been made in supporting women in access to skills and training and in the public sector, but was disappointed by the lack of action to break down stereotypes in the education system, particularly for children below 14 years of age.
Gender Equality Checklist
The GEO, Trades Union Congress (TUC), the Confederation of British Industry (CBI), the Chartered Institute of Personnel and Development (CIPD) and the Equal Opportunities Commission (EOC) have worked together to develop and pilot a gender equality checklist to help make employers more aware of the implications of some of the practices they have in place.
The Work and Families Act 2006 came into force in April 2007. It extends the scope of flexible working law to give carers of adults the right to request flexible working. In addition, statutory maternity pay, maternity allowance and statutory adoption pay have been extended from 26 weeks to 39 weeks for babies born on or after 1st April 2007, or adoption placements from that date.
The Equality Bill was introduced in the House of Commons on 24th April, 2009. It is expected that subject to the approval of both Houses of Parliament the Bill will receive Royal Assent in Spring 2010.
2.3. Please illustrate the main initiatives by the government to address the gender pay gap since 2005 in the public sector. Here the government acts as the employer and can intervene more directly, even if often the rules on compensation leave less room for pay differentials.
The Equality Act 2006, which came into effect April 2007, introduced a gender equality duty for all public authorities. This requires public authorities to promote equality of opportunity and eliminate unlawful harassment and gender discrimination
3. Social partner initiatives to address the gender pay gap
3.1. In light of the current economic crisis, have the social partners, whether unilaterally or jointly, taken any steps to assess and monitor the impact of the current economic downturn on gender pay inequalities? If yes, please briefly illustrate them, including the results of such assessment. Have the social partners started any initiatives to prevent or address the possible widening of the gender pay gap because of the economic downturn?
No.
3.2. Please indicate whether the gender pay gap has figured prominently on the trade union agenda since 2005. Have the trade unions initiated in this period any specific initiatives to address the gender pay gap? Please illustrate the most important of such initiatives.
For instance, these could include:
- Awareness-raising campaigns
- Starting organising efforts targeted at low-paid occupations/sector where female employment is particularly high
- Including the issue of the gender pay gap in collective bargaining rounds
- Training initiatives to fight gender segregation
The WWC recommended that good quality, thorough training for equality representatives (reps) was imperative and should be supported by 5 million GBP. Unite the Union (Unite) was one of the first unions to take full advantage of this scheme, being awarded funds in 2006 for a project to develop guidance and support for union equality reps. One of the most recent awards goes to the TUC for a one year project which will employ a worker to liaise with the different unions and develop a targeted training programme for tutors and national officers so that they can train other in their unions and improve their ability to bargain over equality issues. The TUC believes that union equality reps are going to represent one of the biggest developments for unions. However, the current lack of statutory recognition for equality reps weakens their effectiveness as few receive paid facility time and some employers refuse to deal with them.
Unison, the largest union in public services, which represents more than one million women in town halls, schools and hospitals as well as police and utilities is currently supporting nearly 35,000 equal pay tribunal claims. Most of these are multiple claims against NHS and local government employers. The GMB is also supporting some 25,000 claims.
3.3. Please indicate whether the gender pay gap has figured prominently on the employer associations agenda since 2005. Have the main employer associations initiated in this period any specific initiatives to address the gender pay gap? Please illustrate the most important of such initiatives.
The CBI believes that the best way to close the gender pay gap is to remove barriers to equality of opportunity between men and women in the workplace – for example, improving child care facilities, promoting flexible working patterns, providing better quality careers advice and breaking down gender stereotypes. Examples of individual employer involvement in such initiatives include the Employers for Work-Life Balance Alliance, set up by the government, which involves 22 employers committed to promoting good practice to other organizations. See also 4.
3.4. Please indicate whether multi-employer collective bargaining has contributed to address the gender pay gap since 2005. Has multi-employer collective bargaining introduced specific clauses or instruments to address the gender pay gap? Please illustrate the most important of such clauses or instruments.
Agreements have been negotiated between unions and employers in Local Government (National ‘Single Status’ Agreement) and the National Health Service (Agenda for Change). In both instances the underlying aim of the agreement has been to bring all employees within a common, equal grading and pay structure. However, both agreements have subsequently led to large numbers of equal pay claims. Similar problems have arisen in the civil service. See sections 3.2 and 3.6.
3.5. Please indicate whether single-employer collective bargaining and social dialogue practices at company level have contributed to address the gender pay gap since 2005. Has single-employer collective bargaining introduced specific clauses or instruments to address the gender pay gap at company level? Please illustrate the most important of such clauses or instruments.
The share of the workforce covered by collective bargaining in the UK is one of the lowest in Europe. Outside the public sector collective bargaining is limited and takes place primarily at the individual company or plant level. If a successful claim for equal pay is made in one company there are no mechanisms for extending the benefits of this advance to female workers in similar jobs or companies.
3.6. Has the issue of the gender pay gap been particularly important in certain sectors? If yes, please indicate the sectors involved (up to three), the main reasons of such relevance and its most significant expressions and achievements (up to three for each sector - unilateral actions by employers or unions, joint initiatives, collective bargaining).
In 2007/8 equal pay replaced unfair dismissal as the most frequent cause of complaint conciliated by the Advisory, Conciliation and Arbitration Service (ACAS). The EHRC estimates that the total number of equal pay cases could rise to over 150,000 in the coming years. Most of these cases are in local government and the health service.
In 1997 a Single Status Agreement was entered into between local government and trade unions to streamline pay scales for all local government workers into one single pay spine putting equal pay for equal work at the centre of future negotiations. A job evaluation scheme was developed to take account of the full range of jobs within the scope of negotiations. The process of implementing the single pay scale was to be completed by July 2007. However, to date less than half of councils have completed pay review schemes and three in ten councils in England and Wales face equal pay cases. Implementation of the new single status agreement should have drawn a line under pay inequality, leaving only historic equal pay claims. However, where pay protection has been introduced as part of the process this has not happened. Employers unwilling to meet the costs of “equalising up” pay across the new structure so that there are no losers have instead negotiated a period of pay protection for those will lose out with the unions.
Claimants who do not have the benefit of pay protection have sought to claim equal pay with employees on the same grade who do enjoy the benefit of pay protection, and thus continue to receive higher pay. This has major implications for the balance between collective bargaining and individual rights when it comes to reaching agreements over equal pay (UK0808029).
Within the private sector the finance sector has come under particular scrutiny. See 1.2 for full details.
4. Good practices
4.1. Since 2005, have there been any major initiatives to identify, collect and disseminate good practices on equal pay or more generally on gender equality in employment?
Opportunity Now, in partnership with the GEO has identified over 100 Exemplar Employers who are doing innovative work to address occupational segregation, equal pay and opportunities for women in the workplace. The organisations have all committed to sharing their best practice with other organisations in the future. The initiative comes in response to the WWC report (see 2.2) Opportunity Now have tracked each organisation’s progress and documented their work in the form of case studies describing the action they have taken and the impact it has had on both women and workplace culture.
5. Commentary
5.1. Please provide your own assessment and comments on the initiatives to address the gender pay gap covered by this comparative study, including any further information that you consider important to illustrate the state-of-play of pay equity in your country.
While there are some initiatives underway there is a long way to go to successfully deal with the gender pay gap in the UK. The problem of down-grading jobs which have increasingly become the preserve of women is an on-going problem. The traditional view of caring and service and largely female jobs as inherently inferior (less skilled, less valuable, lower paid) to ‘wealth creating’ financial, technical and manufacturing largely male jobs needs to be challenged more forcefully. Men are much more likely to be promoted into managerial positions and thus more likely than women to progress in their careers. There is also a long-established view that certain jobs – senior managerial posts, skilled manufacturing jobs, key service industry posts – are unsuited to part time and flexible working. Providing women with a choice of high quality, well paid part time work remains a problem. This requires changes in the attitudes and aspirations of men as well as women. Much may depend upon the impact of the Equality Bill currently passing through its committee stages, especially the prospect of mandatory equal pay audits in the private sector. But women may feel that the TUC is right when it argues that the government should have been bolder (UK0904029).
Helen Newell, University of Warwick