Employee Engagement

All organisations with more than 50 employees should publish details of what they pay the men and women who work for them, MPs have said.

A report by the Business Committee called for the net to be widened to include smaller firms, saying there was evidence of wider pay gaps among them.

Currently, only firms of more than 250 staff must state the average pay difference between men and women. Committee chair Rachel Reeves said some of the biggest gaps were “obscene”.

The report said recently published gender pay figures had “shone a spotlight” on the issue of a gender pay gap and helped women raise any disparities.

However, only half of the UK’s workforce is covered by the present reporting requirements. The report said the new reporting regime was a “step forward”, but called for the government to be more ambitious.

Key findings from the data published in April included:

  • Gender pay gaps of more than 40% were not uncommon in some sectors
  • Almost four in five (78%) organisations reported gender pay gaps in favour of men

Labour’s Rachel Reeves, chair of the committee, said the biggest gender pay gaps of more than 40% were “obscene and entirely unacceptable”.

“Transparency on gender pay can only be the first step.

“A persistent gender pay gap shows that companies are failing to harness fully the talents of half the population. The penalties of working part-time, both financial and in terms of career progression, are a major cause.”

She said companies needed to “take a lead”, suggesting they could offer flexible working at senior levels.

The report calls for firms to publish annual progress reports, including action plans for tackling any wage gaps.

The government said the UK was one of the few countries in the world to require employers to publish comprehensive gender pay gap data.

The Government Equalities Office said it was publishing new guidance for firms on recruitment and the progression of women, and ways to close their gender pay gap.

Minister for Women and Equalities Penny Mordaunt said it was “appalling” that in the 21st Century there was still a big difference between men and women’s average earnings.

“We need to take action to ensure businesses know how they can make best use of their best talent and make their gender pay gaps a thing of the past,” she said.

Sam Smethers, chief executive of women’s rights group the Fawcett Society, said: “We have to move on from simply reporting the pay gap, to taking action to close it.”

The CBI, the UK business group, said companies with a diverse workforce and leadership perform better than those without.

Matthew Percival, from the group, said: “The gender pay gap is a societal challenge with a complex mix of causes.

“Businesses need to work in partnership with the government on improving careers advice in schools and offering affordable childcare for working parents.”

Although there was no requirement to report, 238 businesses with fewer than 250 employees voluntarily filed their pay gap figures by April.

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