Lesley Murphy: Push for equal pay hindered by employees’ reluctance to talk about salary with colleagues

SALARY. Historically, one of the most sensitive topics of conversation for individuals in the UK.

As society has progressed with increasing measures being taken to improve equality, it was envisaged that such social taboos would gradually dissipate. However this does not appear to have happened with a recent Scottish Widows survey indicating that almost half of UK employees do not want to discuss salary details with their colleagues.

To some extent, this practice had been encouraged by employers who, for obvious commercial reasons, did not want their employees discussing their respective earnings. It is not uncommon to find clauses in employment contracts which effectively gag employees from discussing their salary.

With the introduction of the Equality Act in October last year, the practice of “gagging” is not completely banned, but in some circumstances employers are prevented from relying on the gagging clauses they have in their contracts. The Act provides that any restrictions on employees making or seeking a disclosure regarding terms of work in order to make a relevant pay disclosure are now unenforceable. It also goes further in that it also permits the government to introduce legislation which would require larger employers to publish employee pay information with a view to uncovering any gender pay gaps.

It appears the government anticipated these measures would stimulate greater transparency in the equal pay arena and encourage individuals to discuss their terms of work with others. However, it may be doubted whether these provisions will have any practical value given the population’s continuing reluctance to discuss financial matters and the fact that no blanket ban on pay secrecy clauses has been enacted.

Under the Equality Act, such clauses are unenforceable only where the employee makes or solicits a ‘relevant pay disclosure’.  This is a disclosure made to enable an employee to determine whether any pay disparity may be discriminatory on grounds protected by the legislation on equality at work. This effectively means that employees will have to consider or suspect that they are being paid differently due to their gender, race, religion etc before asking a colleague about their terms of work in order to be protected. For example, two female colleagues of similar age, race etc who discuss salary and bonus provisions are unlikely to be covered by section 77 and accordingly, their employer could enforce any pay secrecy clause in respect of such a discussion. 

An employee may also face practical difficulties in leading evidence that any salary discussion was a “relevant pay disclosure”. Given the sensitive nature of the topic, it may be unlikely that an employee when requesting or disclosing such information will explicitly suggest to a colleague that they believe their employer is acting in a discriminatory fashion. In these early days, it remains to be seen what will be considered sufficient to show a relevant disclosure.

The measures brought in by last year’s Equality Act therefore arguably lack the teeth to introduce real change in the way that people view discussing salary.  Certainly recent statistics show that to date, the legislative changes have not loosened lips.

• Lesley Murphy is a Partner at Harper Macleod LLP