Early results show gender pay gap widening

With only weeks to go until the reporting deadline, four in 10 private companies that have published their latest gender pay gap are reporting wider gaps than they did last year, according to BBC analysis

From 2017, any organisation that has 250 or more employees must publish and report specific figures about their gender pay gap.  The deadlines for doing so are 30 March for public sector organisations and 4 April for businesses and charities.

The BBC's analysis of a company's median pay gap refers purely to private sector firms which had gender pay gap data and a consistent registration at Companies House for April 2017 and April 2018.

Only about 10% of businesses have reported their latest figures so far. Of these 1,146 companies the median gender pay gap reported is 8.4%, down from 9.7% last year.

However, a number of major employers, including Kwik Fit, Npower and Virgin Atlantic, have reported a wider pay gap than previously.

Kwik Fit moved from having a negative gender pay gap of minus 15.2% to a positive one of 14%.

A company spokeswoman said: ‘Last year most of our female employees were in our upper quartile of salary bands, however over the course of the last 12 months a number of these senior employees have left the company, a shift which has skewed our figures.’

The gap at airline and tour operator Virgin Atlantic also widened, from 28.4% to 31%, while at Npower it has grown from 13% to 18%. The energy giant partially attributed this to more female than male employees opting for a salary sacrifice benefits scheme.

In the financial services sector, the average gender pay gap at RBS was 36.8%, one of the biggest gaps reported by a firm with 5,000 employees or more, while at Lloyds Banking Group it was flat at 32.8%.

London Heathrow Airport was among the firms that improved, posting a gender pay gap of 0.6% compared with 6.5% a year earlier.

Of the companies that had reported by the morning of 19 February, BBC analysis shows 74% report a pay gap which favours men, 14% have a pay gap favouring women, and 12% report no pay gap.

The Equalities and Human Rights Commission said in a tweet: ‘Meaningful change will take time. It’s important not to look at #GenderPayGap figures in isolation and for employers to publish action plans setting out the context of their figures and steps they are taking to address them.’

Clare Parkinson, pay and reward manager at Croner, said: 'Although it is not a legal requirement to have reduced the gap over the last 12 months, employers may be worried about the reaction they may receive both from their internal workforce and externally if their gap has widened or stayed the same.

'Publically displaying that the gap has increased may have a negative effect on female workers in the company who may wonder why, after last year’s initial findings were published, the company has not only failed to improve the situation, but has in effect allowed it to deteriorate. It should be remembered that this remains a hugely scrutinised area and that taking steps to reduce the gap can help to encourage the retention of key employees, alongside the attraction of talented individuals who may otherwise not have shown interest.' 

Rachel Mapleston, legislation expert at MHR, said: 'The widening discrepancy in gender pay highlighted by the BBC analysis although alarming does not come as a great surprise. With this year’s reporting deadline based on snapshot dates of 31 March and 5 April 2018, employers that didn’t take the time to evaluate their results and start to implement changes were never going to see much of a difference.   

'Employers who identified a gap but chose not to act on this information may well be seen in a less favourable light than those with initially bigger pay gaps who have demonstrated they are working towards reducing them.

'As part of their inaugural report last year employers were asked to include a supporting narrative, outlining why their gap exists together with their plans to address it. If organisations have started to act on this then hopefully we will start to see the gaps narrowing in 2020, however this has been an issue since legislation was introduced in the 1970s, so it will likely take many more years to resolve.'

Report by Pat Sweet

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