By Sian Webb at Gapsquare, a tech start-up which uses data science to reduce the gender pay gap, compares the Conservative, Labour, Liberal Democrat, Green, UKIP and Women’s Equality Party election promises about pay disparity
The snap general election was mainly been focused on Brexit, yet all parties produced manifestos which will pave the way for policy and governance over the next five years.
Equality and diversity has ignited both the public and politicians alike, with women’s rights being at the forefront of activism, 2018 being the centenary of women’s suffrage and three formidable political leaders Sturgeon, Davidson and May seen as reaching the tipping point for equal gendered representation in politics. A McKinsey report published in 2015 stated that gender diverse companies are 15% more likely to outperform than their competitors, and ethnically diverse companies are 35% more likely to outperform, and so it is critical to understand what the political parties say about tackling equality and diversity within business.
The Conservative Party introduced this April, regulations that state that all companies over 250 employees have to report on their gender pay gap. Their manifesto continued the legislation requiring companies of over 250 employees to report. One of the main criticisms of the current legislation is that there are no penalties for companies that fail to report, or any incentive or penalty to reduce or tackle the gap. Their manifesto failed to address this criticism and there were no provisions for enforcement of the regulations.
They do however, go one step forward and promise actions which will ultimately reduce the gender pay gap:
- Improving the take-up of parental leave
- Helping companies to provide more flexible work environments for parents
- Providing parents or carers with the confidence to return to work after long periods of absence
The Conservatives also pledged to ask large employers to publish information on the pay gap for people from different ethnic backgrounds. The ethnicity pay gap has long been overlooked and creating legislation that addresses racial disparity is a great starting point in tackling racial inequality. However, this pledge lacked detail as to how it would work in practice.
The Labour manifesto discussed equal pay audit requirements on large employers and that by making the minimum wage a real Living Wage, it will benefit ethnic minority workers who are more likely to be on low pay. Labour’s focus was mainly on ethnicity, stating that they will implement the recommendations from the Parker Review. These look at increasing the ethnic diversity of UK boards. Labour’s only mention of the gender pay gap is that they plan to introduce a civil enforcement system to ensure compliance with gender pay auditing. We are already building in an automatic syncing with the Government Equalities Office so that reporting is even easier and we call on Labour to work with us to take this on step further to ensure that companies comply with the new regulations.
The Liberal Democrats went one step further past both Labour and the Conservatives with a pledge to extend the Equality Act to all large companies with over 250 employees, requiring them to monitor and publish data on gender, ethnicity, LGBT+ employment levels and pay gaps. At Gapsquare, we have already designed a tool that allows companies to measure their pay by ethnicity, and are building in other protected characteristics too. We call on both Liberal Democrats and Conservatives to work with us to make it simple and easy for companies to report on ethnicity pay gap.
The Green Party manifesto went even further, pledging to end the gender pay gap, although they don’t specify how they plan to do this. Considering the World Economic Forum stated that it will take 117 years for the gender pay gap to close, this is unlikely to happen in a five-year term. At Gapsquare, we have designed a tool that, by using data trends, and modelling recommendations, can narrow the gender pay gap by a century. This is still far off a five-year term, but has been designed to quicken the speed of change. We call on the Green Party to get in touch to work with us on how you can use technology to reduce the gap even further.
The UKIP manifesto failed to mention pay disparity both in terms of the gender pay gap and the ethnicity pay gap. To be frank, reading the manifesto was challenging both in terms of my personal feminist viewpoint but also equality and diversity more broadly.
Lastly, the Women’s Equality Party published a manifesto which called upon the other political parties to “steal” their ideas and policies and embed them into their own. Their policies in terms of pay disparity were the most comprehensive of the manifestos. They pledged to:
- Extend the gender pay gap reporting so that businesses over 50 employees have to report, and over 20 for businesses in Scotland
- Require reporting to be broken down by age, employment status, ethnicity, race, disability, industry and working hours – this is far the most detailed analysis of pay, and something that we at Gapsquare already undertake – companies who use our tool can break down their gap by these variables so that they can truly understand where their gender pay gap comes from and therefore, what they can do to eliminate it.
- Work with HMRC to gather similar date through PAYE and Self-Assessment forms to allow researchers to develop an understanding of disparity in pay. This allows for the vast numbers of women who are self-employed and begins to build up a true picture of pay inequality in the UK.
Speaking broadly across the political parties, the focus on truly reducing the gender pay gap appears somewhat translucent. Whilst reporting is a great starting point, the need to tackle the root causes behind both the gender and ethnicity pay gap remains crucial.
Measures to truly tackle workplace culture will ultimately reduce the gender pay gap, for example, moving away from the standard 9-5 working week and promoting flexible working for both men and women is a great starting point. As is improving legislation around parental leave so it is actually cost-effective for fathers to take responsibility for childcare.
Addressing occupational segregation will tackle both the pay gap as well as the skills gap. It is equally important that management move away from “locker-room promotions” and “decisions on the golf course”. We also know that unconscious bias plays a big part in inequality – we hire based on those who are “like us” and tapping into the potential of those who are different will echo the sentiment of the McKinsey report. Further, eliminating the gender pay gap will expand the UK economy by over 20%, which should be reason enough to tackle pay disparity head on.