BUSINESS AWARDS: Firms will have to take action on gender pay gap

David Poddington, the firm’s head of employment law, discusses the impact new rules on gender pay reporting may have on local businesses’ ability to attract and retain staff.

Sheffield City Region has a number of fantastic businesses in the manufacturing and engineering sectors, including many Taylor&Emmet is proud to call clients.

A consistent message I hear from these organisations is that enticing and retaining employees with the right skills, particularly in specialist engineering, is becoming increasingly difficult.

Real strides are being made to address this skills’ gap through a range of initiatives, including the promotion of apprenticeship schemes, but these will take time to bear fruit. In the current climate, it is clear no business can afford to exclude any section of society from its recruitment drive, not least women who represent the majority of the UK population.

While some attempts are being made to engage girls at school in science, technology, engineering and mathematics and promote a career in advanced manufacturing, the government’s new law on gender pay reporting may present a challenge and an opportunity for employers.

Average pay for men is greater than for women. Last year, the gender pay gap was 9.4 per cent for full-time employees, the lowest since records began in 1997. However, the gap for all employees was 19.2 per cent, which takes into account the large proportion of women who work part time (41 per cent compared with 11 per cent of men). On average, part-time workers of both genders earn less per hour than their full-time counterparts.

On October 1 this year, new regulations on gender pay reporting come into force and will apply to private and voluntary sector organisations with 250 employees or more.

These guidelines are expected to require businesses to publish, among other things, their overall gender pay gap and information on the difference between men and women’s average bonus pay.

Employers will have an option to explain any inequalities and set out what action they will take to close them. All of this information will need to be available on the company’s website.

So how does this relate to attracting the brightest and best young talent? The full impact of the new law remains to be seen, but it is easy to imagine league tables ranking employers by gender pay gap.

The cause of a pay discrepancy can be quite complex and does not necessarily equate to sex discrimination. For example, it may be due to the proportion of men and women in certain jobs, often for historical reasons.

Nevertheless, it is likely, in my view, that in demand, skilled young women will be checking an organisation’s gender pay gap before accepting a job offer and if you don’t compare favourably with competitors, you may lose out.

Organisations need to address now any gender pay gap, if indeed they have one, with a view to eliminating it if possible. At the very least you need to comply with the new law and demonstrate you offer an environment in which talented women can progress and receive fair reward for doing so.

To find out more about Taylor&Emmet’s employment law services, contact (0114) 218 4000, visit www.tayloremmet.co.uk or follow the firm on Twitter, @tayloremmet.