Government’s gender pay gap move ‘like turning back the clock on progress’
The threshold for reporting has been raised from 250 to 500 employees, in a misguided bid to cut red tape.
UK gender pay gap figures don’t make for pleasant reading, and the narrative has shifted only minimally since reporting became mandatory in 2017.
But that only makes it more important to keep up the pressure, so we can build on the small amount of progress we’ve made so far.
However, a new government setback will make that mission even harder. The threshold for reporting has been raised from 250 to 500 employees, so that – in a misguided bid to cut red tape – thousands of companies have been spared from public scrutiny on equal pay.
The move feels like turning back the clock on progress, and it comes at a critical time: April’s pay gap report showed that the median gap in the communications industry had widened in the past year, so that women now earn only 83p for every £1 earned by a man. This compares with a 90p average across all industries.
WACL believes that measurement means management, which is why we fought so hard to have gender pay gap reporting reinstated after a suspension during the pandemic.
Reporting gives women the information we need in order to lobby for change, and we can’t let this go now.
Just because a legal requirement has been removed, it doesn’t mean the moral imperative is gone. Any company with fewer than 500 employees that stops sharing its pay gap figures will be opening itself up to criticism that it was no more than a box-ticking exercise all along.
Both Campaign’s School Reports and the IPA Census have led the way in publicising the pay gap figures for our industry; every year, gutsy agencies with fewer than 250 staff have been voluntarily reporting their numbers, and it’s important that our industry maintains momentum.
I have no doubt that Campaign will be keeping an eye out for any agencies that take this latest excuse to slip the net, just as it makes a point of celebrating the agencies that are making progress.
Ever since 2017, the figures have shown us why we need to keep the pressure up. The IPA Census reported that the pay gap widened from 22.7% to 23.3% in the year to September 2021, while among the agencies who shared figures with Campaign, the gap had narrowed from 16% to 14.4% – either way, progress is slow, which only goes to demonstrate that gender pay gap reporting is more important than ever.
As we come out of the pandemic and make the permanent shift to new, more flexible ways of working, there is a hope at WACL that the pay and status of women in our industry might be open to real improvement. Recent setbacks may be due in part to the way in which the lockdowns disproportionately affected women, but there is real opportunity now to set that right.
Gender pay gap reporting works, because it galvanises companies into having a strategy in place to improve its numbers. Research by McKinsey estimates a £150bn benefit to UK GDP if gender equality in all workplaces was raised to that of the best.
We know that more diverse teams perform more effectively, but that without reporting, we risk entrenching existing inequality instead of modernising for the benefit of all.
The government’s own Equalities Office surveyed 900 employers in 2019, and the majority believed that gender pay gap reporting increased focus on wider equality and diversity.
By moving the goalposts on gender pay gap requirements, the government is effectively undermining the exercise for everyone. It sends a signal that reporting is merely a red tape inconvenience rather than an essential tool for improving equality in the UK.
Gender pay gap reporting is a way to measure success and progress, and one that none of us can afford to discard. We already know that having a strategy in place to improve a company’s GPG, backed up by mandatory reporting, improves an organisation’s overall performance and helps deliver vital talent, diversity and inclusion strategies. A must as the talent crunch continues.
It has never been more important to challenge businesses to report their GPG, but also to support them to do so. WACL calls once again for mandatory action plans and more rigorous controls on reporting, beginning with all companies in the industry analysing their pay data
and developing quality action plans for employees.
The communications industry must show solidarity by continuing to report GPG, remaining transparent and keeping the dialogue open so we can all help each other to improve.
Visit here for WACL’s practical help on how to close your company’s gender pay gap.
This article, by organisational strategist and WACL Campaigning Committee Member Sara Tate, was originally published in Campaign Magazine on 2nd November 2022