Firms required to reveal gender pay gap

Under new plans announced by Nicky Morgan, minister for Women and Equalities, companies will be forced to reveal the number of men and women in each pay grade, revealing potential gender pay gaps.

According to official statistics, women in the UK still earn an average of 20 per cent less than men.

The new rules will apply to firms with more than 250 employees and is set to affect around 8,000 employers across the country. The regulations will be enforced from April 2018, meaning films will need to start calculating pay gaps from April 2017.

Employers will be required to publish their gender pay gap figures on their website and will be expected to report to senior executives annually to have the figures officially signed off.

Morgan said: “I’m calling on women across Britain to use their position as employees and consumers to demand more from businesses, ensuring their talents are given the recognition and reward they deserve."

Carolyn Fairbairn, CBI director-general, warned that league tables should not be used to ‘name and shame’ firms. She argued that data could only give a partial picture, with factors such as the mix of part-time and full-time workers, as well as sectoral differences, needing to be taken into account.

Fairborn advised: "The government should consult closely with business to ensure that this new legislation helps close the gender pay gap, rather than ending up as a box-ticking exercise."

However, Ann Francke, Chartered Management Institute chief executive, welcomed the plans. She said: "Publishing league tables will drive diversity, bringing benefits not just to women but to business. Closing the pay gap will open the talent pipeline, increase management quality and boost productivity."

According to figures from the Office for National Statistics (ONS), the gap between men and women’s pay for full-time work had decreased from 9.6 per cent in April 2014 to 9.4 per cent in 2015.