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It is 30 years since the implementation of the Equal Pay Act and Sex Discrimination Act, yet women in the UK still earn on average 18% less per hour than men (What is The Pay Gap and Why Does it Exist?, 2005). The rate of reduction in this gender pay gap has also slowed, as can be seen from the negligible change between the 2003 and 2005 figures (Towards Equal Pay, 2003).
The most obvious question to be answered is why does this ingrained pay gap exist? Is there a policy of discrimination against women by employers? Or, is just a case of the simplistic interpretation of a figure which disguises underlying socio-economic factors which employers have little to do with? This article is going to look at the role that discrimination legislation has had in addressing this, what recent developments have taken place in the area and what future changes in the law which might be beneficial.
It is important first to clarify what is meant by “equal pay”, because there are two separate but intertwined issues . The first, which we will call the micro pay issue, involves clear discrimination: where a man and a woman do the same job but the woman is paid less - the “equal pay for equal work” issue. However, there is also a second more complex issue and which we will call the macro pay issue. This encompasses all the broader socio-economic factors that may create the differences in averages.
The Micro Issue
It is easy for today's women to forget that open pay discrimination was a prevalent, and even accepted, practice into the 1970s. The Equal Pay Act 1970 (as amended), and other ancillary legislation, has proved very effective in eliminating such blatant discrimination. This legislation functions reasonably simply in that it bans pay discrimination based on gender. It does this by allowing those workers who believe they are doing the same work, but are paid lower rates - because of their gender - to bring an action at an Employment Tribunal. The tribunal will then decide if the workers are doing “like work” or “work of equal value” . This process has been made even simpler since the introduction of the Equal Pay Questionnaire (EPQ) in 2003.
The EPQ is a standardized questionnaire which allows the person who believes they are not receiving equal pay (the complainant) to fill in and present this form to her/his employer (the respondent). On this form the complainant must identify a person of the opposite sex who is doing the same, or similar work, of like value (known as the “comparator”) whom they believe is paid more. Pay in this case refers to the whole range of remunerative elements like holiday pay, sick leave, bonuses, and even redundancy.
Once this is presented to an employer they may just accept the argument and agree to the request for equal pay or fill in the required sections disclosing a comparator's salaries or possibly making their own counter-arguments. However, they are not required to answer the questionnaire. But, if the complaint brings an action and the employer does not respond to the questionnaire or does so in an “evasive or ambiguous” an adverse implication could be drawn . This is a very effective way to target remaining cases of sex discrimination. The aim is to make a workplace resolution of this issue possible and avoid costly and counterproductive litigation.
In the high profile Stephanie Villalba case against Merrill Lynch, Ms. Villalba attempted to use cross-border comparisons will male colleagues in international Merrill Lynch offices in order to demonstrate the inequality of her pay (McCormack, 2004) . And while she lost the case it does demonstrate that the boundaries are continually being pushed in this area.
The Macro Issues
The reason for the gender gap however is more complex than just blatant discrimination. The average hourly pay figure that is used commonly when referring to equality of pay is just an overall average of payments made to male and female employees for the hours they work. This figure encompasses much more than the “equal pay for equal work” issue because it is an average and so takes into account broader factors. Some simple detective work will reveal the nature of this issue. After the introduction of a mandatory minimum wage the gender pay gap decreased by 2%. The reason for this was that 70% of the jobs affected by the legislation were occupied by women (Making a Difference,2001) and so their average wages rose disproportionably to men and the gender gap fell. This clearly demonstrates that the second strand of the equal pay problem is that a large number of women occupy occupations/professions or take jobs that pay less. Why is this? In December 2001 The Government published the KingsMill Review (Kingsmill, 2001) and this is the best source of information we have to identify the relevant factors. These are:
Qualifications Gaps: historically men have held better qualifications that women, although this effect is clearly tailing off - or disappearing - as women's access to education has increased.
Continuity of Experience: women have tended to take breaks to have and to raise children. This can lead to lower continuous experience levels which is then reflected in pay.
Part Time Work: Women have tended to occupy more part-time jobs because they often try to balance work with childcare. These jobs tend to be in occupations which are lower paid and as such this drives down their average earnings.
Commuting: because of their need to jungle a job and childcare they are less able to commute long-distances and need to find employment locally. This affects their income because there is a lower pool of jobs open to them and more women are clustered around the same locations competing for those jobs.
Job Segregation: 60 percent of women work in just 10 occupations; and these tend to be the lowest paid occupations.
The question which must be asked is whether any of these issues can be addressed by the current laws or is legislation the wrong route to take. The pay gap is clearly narrowing, but it is also possible that the gap will never close because of large numbers of women voluntary choose to take lower paid work in order to raise a family. And legislation cannot be used to force this to change.
However, it is equally likely that some of the factors that were identified above can be reduced or eliminated with the use of more ‘carrot' and less ‘stick'. The effect of the minimum wage legislation was clearly quite effective in narrowing the gap even if this was not the main reason for the legislation. But this form of legislation may have its limits and a more subtle legislative interventions might be required. For example, a legal requirement for better workplace childcare so that women might not develop a gap in experience and be able to travel further to work. Alternatively the discrimination against part-time workers could be targeted, as it was with The Part Time Workers Regulation 2000; which is attempting to remove discrimination against such workers.
Some form of legislative female quotas for certain occupations might also be introduced - starting with the NHS. This is a draconian move but it could give women a once off “leg up”. On the other hand legislative intervention of the kind above is controversial and be counterproductive. The more rights granted to a woman the more likely might an employer might just stop hiring women in the first place for fear of the “costs” and difficulties imposed.
In the final analysis the solution to the search for equal pay will be a multifaceted approach that addresses all of the issues and does not become to focused on the belief that it is caused by blatant discrimination.
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