Labour proposes fines for gender pay gap

Written By: Chris McLaughlin
Published: March 11, 2018 Last modified: March 11, 2018

Labour has pledged to impose fines on companies which fail to close their gender pay gaps following evidence that top-paid men outnumber higher paid women by four to one.

The Labour action would go further than Government proposals aimed at encouraging employers to deal with a wide national disparity in average earnings and the higher paid.

New Government data has revealed that there are almost four times more men than women in Britain’s highest-paid jobs. The survey focuses particular concern on the City and among professionals with six-figure incomes, though it shows women are disadvantaged at all pay levels compared to male colleagues in similar posts.

Firms have proved slow to respond to Government calls for action to tackle the disparities. Companies with more than 250 employees are soon to be required under new rules to report their pay rates to the Government. The deadlines are the end of March for public firms and 4 April for the private sector. But only 1,600 out of 9,000 have reported so far.

The large gap in average earnings, which affect the greatest number of workers, revealed that male taxpayers had a median annual income of £25,700 compared to the equivalent female counterpart on £20,300. The figures do not take account of the fact that more women are in part-time or low-paid work and do not earn enough to pay income tax.

The official gender gap is 18.4%. Home Secretary Amber Rudd has written to employers asking for help to “drive forward this important change so that we can close the gender gap”.

Under a Labour government private and public companies would not only have to audit gender pay and publish figures but also prove they were taking action to close the gap. Failure to do so could trigger legal action with hefty fines as penalties. The party proposes compulsory certification every two years.

The shadow equalities minister Dawn Butler (pictured) said: “Some companies are using loopholes to get out of giving the full picture, and then there’s no real enforcement if you are found to have a huge gap. We don’t just want people to identify the pay gap. We want the pay gap to close.”

About Chris McLaughlin

Chris McLaughlin is Editor of Tribune