Susan Dalgety: Progress since introduction of Equal Pay Act

It is 46 years since the Equal Pay Act was introduced. Susan Dalgety looks at the progress of this '˜historic advance'

The 1968 protest about unskilled jobs which was recreated in Made in Dagenham led, in part, to the Equal Pay Act introduced by Barbara Castl

WHEN the Equal Pay Act was introduced in 1970, it was lauded as an “historic advance in the struggle against discrimination in our society”. Speaking in the House of Commons, the Labour government’s Employment Secretary Barbara Castle – the driving force behind the legislation – went on to describe the concept of equal pay for equal work as “self-evidently right”, and reminded MPs that the Trade Union Congress had first endorsed the principle of the same wages for the same work in 1888.

Castle’s “historic advance” would appear to have stalled somewhat. Nearly five decades after she asserted that her bill would bring about the end of the financial exploitation of women’s work, the pay gap remains stubbornly in place.

In Scotland, the 2015 Annual Survey of Hours and Earnings showed the median gap between what men and women earn when working full-time currently stands at 7.3 per cent, with the overall UK gap even wider, at 9.3 per cent.

When you examine the gap between women who work part-time with men’s full time hourly rates, the gap become becomes dizzyingly wide. The 2015 ASHE figures showed a median gap of 35 per cent.

Some sectors have a pay gap that would make Castle despair. Research by the Law Society of Scotland last July shows, at its worst, a 42 per cent pay gap among its members.

Janet Hood, convener of the society’s equality and diversity committee, said the gap was a major concern for the profession: “Quite simply, it is not something we can afford to ignore, for either ethical or business reasons.”

The corporate pay gap is also striking, particularly in bonuses – a central feature of financial services. Research by the salary benchmarking website Emolument shows that men take home almost twice as much in extra rewards as women.

The public sector has a marginally better record. There are single status agreements in place for councils, the NHS, and elsewhere, which should ensure that, at least in theory, all staff receive equal pay for work of equal value.

It definitely works in the higher echelons of the Scottish civil service. A few weeks ago, the Scottish Government published statistics that showed Scotland’s senior civil service has the smallest difference between men and women in top public sector jobs.

The gap in Scotland’s senior civil service is just 0.6 per cent in contrast to UK government departments where women are, on average, paid 6.3 per cent less than men.

Further down the public sector career ladder, the picture is less positive. There are currently up to 50,000 equal pay tribunal cases pending, brought by women working in jobs such as social care, catering and cleaning.

A recent assessment of local authorities by Close the Gap – the organisation that supports businesses and others achieve equal pay – showed that the gap ranges from 0.9 per cent to a staggering 19 
per cent, with Close the Gap suggesting the higher figure is probably more accurate.

This continuing disparity prompted the Scottish Government in January to extend the requirement on public authorities to publish information on their gender pay gap and equal pay statements.

If passed by the Scottish Parliament this month, public authorities with more than 20 employees will be required to disclose gender pay gap information and statements on equal pay.

The UK Government has also introduced a requirement for private sector companies – and public bodies – with more than 250 employees to publish pay gap information – a measure which will cover more than 10 million workers across the UK.

Under these plans, from April 2018 the UK government will publish pay league tables detailing the best and worst companies, by sector.

First Minister Nicola Sturgeon explained the thinking behind the Scottish Government’s move at a Unite conference in January.

She said: “One way to challenge the gender pay gap is to shine a light on it and to force organisations to look at how they determine pay and who is paid what.

“The regulations go further than elsewhere in the UK and are a further recognition that the gender pay gap has no place in a modern and equal society.

“The Scottish Government, and the wider public sector, must lead by example in its elimination.”

But why does closing the gender pay gap matter so much? And won’t increasing the pay bill cost businesses money?

Quite the opposite according to Anna Ritchie Allan, Close the Gap project manager, who says the business case for taking action is obvious: “The pay gap doesn’t just affect women, employers are missing out on women’s under-used skills and talents.

“The business case for taking action on the pay gap is clear: companies that make small changes to their employment practices are able to recruit from a wider pool of talent, enjoy a reduction in turnover and training costs, and experience higher productivity through improved employee motivation. 

“If women’s employment levels equaled that of men’s it would add up to £600 billion to the UK economy. And that’s good for everyone.”

Business in the Community argues that eliminating the pay gap would help companies attract the best talent and boost their bottom line, which is why equal pay is one of the three priorities of its Opportunity Now campaign to remove the barriers to women participating fully in the labour market.

The campaign cites research by the Chartered Institute of Personnel and Development (CIPD) which shows that fair pay is the biggest factor people consider when thinking about moving to a new job, with 54 per cent of employees saying the main reason for wanting to change employers is to boost their salary.

Forty-six years ago, in the same speech where she lauded the Equal Pay Act as an historic advance, Castle said she could think of “no reason why this bill should not be the means of bringing to an end an era of financial exploitation of women’s work”.

Morag Hutchison, employment partner with Burness Paull, is clear that the main reason why the pay gap persists – despite the Equal Pay Act and its successor, the 2010 Equality Bill, is that “unconscious bias” remains widespread.

She says: “Most of it does come down to gender issues – employers often say it’s down to the type of jobs or seniority, but we need to ask why more females than males are associated with jobs that attract a lower salary. Why have more males than females got to that position – yes, it is to do with issues like the division of care falling much more on females, but for me, it is unconscious bias which underpins the gender pay gap.

“Things will change over time as women dominate certain professions at entry level, but the main issue has to be tackling unconscious bias among people who are making the decisions – men and women.”

Hutchison suggests no-name CVs could be useful tool to tackle bias against women and she welcomes the drive by both the UK and Scottish governments for more transparency by businesses on the pay gap.

She also highlights a major equal pay claims case due to be heard later this year.

“There is a very interesting test case coming to the courts involving Asda, where women working on the shop floor are bringing a claim because they earn less than men in the distribution department and warehouses.

“Although the jobs are different, the argument is that they are jobs of ‘equal value’. There have been similar cases in the public sector, but this is the first main private sector challenge on this scale involving a large number of claimants.”

Whether the Asda women become as famous as the Made in Dagenham pioneers, whose 1968 strike in protest at their jobs being classed as “unskilled” led, in part, to the Equal Pay Act, remains to be seen.

Perhaps we are in sight of finally achieving the “historic advance” that Castle promised all those years ago.

In November, the Prime Minister David Cameron described the gender pay gap as “a standing rebuke to our society” and promised to “end it in a generation.”

As Business in the Community argues in Food for Thought, its business case for gender equality at work: “when it comes, it will be good for women, good for employers, good for society and good for the UK economy.”

This article appears in the Spring 2016 edition of Vision Scotland. An online version can be read here. Further information about Vision Scotland here.