End ‘Monstrous Injustice’ of U.K. Gender-Pay Gap, Lawmakers Urge

(Bloomberg) -- The U.K. must do more to close its gender pay gap, which is one of the widest in Europe, a panel of lawmakers said in a report that called for tighter reporting requirements for companies.

Some 10,000 employers with more than 250 employees in the U.K. were required to report the average hourly pay differential between men and women in their organizations for the first time this year, with more than three quarters revealing wages skewed in favor of men. Analysis in the report by the House of Commons Business Committee published Thursday found that pay gaps of 40 percent are “not uncommon” and 1,377 firms had a gap in excess of 30 percent.

“Gender pay reporting has helped to shine a light on how men dominate the highest-paid sectors of the economy and the highest-paid occupations within each sector,” Committee Chair Rachel Reeves said in a statement. “The gender pay gap must be closed, not only in the interests of fairness and promoting diversity at the highest levels of our business community, but also to improve the country's economic performance and end a monstrous injustice.”

Reeves called pay gaps of 40 percent “obscene and entirely unacceptable.” That's a category that would include Goldman Sachs Group Inc., whose data revealed the bank pays its female staff on average 56 percent less than men.

New Guidance

In a statement Wednesday, the Government Equalities Office said that all 10,000 companies required to submit pay-gap data had now done so. In new “What Works” guidance, the office set out strategies to help firms improve the careers of women and ensure they are paid the same as men for comparable jobs.

“It is appalling that in the 21st century there is still a big difference between the average earnings of men and women,” said Minister for Women and Equalities Penny Mordaunt. “We need to take action to ensure businesses know how they can make use of their best talent and make their gender pay gaps a thing of the past.”

In its report, the Business Committee urged the government to expand the scope of pay-gap reporting, as well as its coverage. Its recommendations include:

• Existing guidance be clarified to eliminate areas of ambiguity
• Employers should accompany their reporting of the pay gap with an action plan spelling out how they intend to reduce it, including specific targets
• The government should publish a list of firms required to report their gender pay gap
• Legal action must be a tool to enforce reporting of the gap
• Differentials should be published for both full-time and part-time employees
• The threshold for compulsory reporting should be cut to 50 employees from 250

To contact the reporter on this story: Alex Morales in London at amorales2@bloomberg.net

To contact the editors responsible for this story: Flavia Krause-Jackson at fjackson@bloomberg.net, Andrew Atkinson, Lucy Meakin

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