APPENDIX 5
Memorandum by the Equal Opportunities
Commission
SUMMARY
The average hourly earnings of women
working full-time is 82% (a gap of 18%) and 60% for part-time
employees (a 40% gap). There are three main causes of the pay
gap discrimination, including pay discrimination, occupational
segregation and the effect of caring on earnings. These factors
closely inter-relate to and impact on each other.
Using its statutory powers the EOC
launched an investigation into the segregation of men and women
in training and work, focusing on apprenticeships and work experience
in relation to construction, plumbing, engineering, ICT and childcare.
An initial report was published last year. Its final report will
be published shortly. The investigation has found that, despite
the fact that women have crossed major occupational barriers in
professions like medicine and the law, has been little or no change
in the sectors studied over the last 10 years and that apprenticeships
were perpetuating rather than tackling segregation. The pay in
childcare, dominated by women, is generally half or less of that
in the other sectors considered. The investigation has found a
clear correlation between areas where men predominate and skills
shortages. As well as damaging an individual's life choices, and
leading to lower pay for women, occupational segregation damages
the competitiveness of the UK economy by failing fully to recoup
our investment in education and training; and by ignoring opportunities
to improve competitiveness by drawing from the full pool of talent
available. It causes employers to miss out on a huge potential
pool of labour with which to cure their skills shortages, and
create a better gender mix in the workforce to meet the needs
of consumers.
In the first phase report, the EOC
called for national strategies to tackle gender segregation to
be developed for England, Scotland and Wales, linked to key economic
and skills strategies and with effective incentives for change.
The planned overhaul of the Apprenticeship scheme should include
actions to address the systemic barriers to taking on atypical
recruits. Other recommendations included that Schools and Connexions
should help to widen choice for young people by providing more
information on options and pay.
The second phase of our investigation
has found that there is considerable enthusiasm for change amongst
young people and support from employers. Only 20% of girls said
they would not be interested in considering a non-traditional
job. However, girls and boys at school are still ending up in
overwhelmingly segregated employment. Our final investigation
recommendations are therefore likely to focus on ways in which
choice can be opened up through work experience and an agenda
to challenge stereotyping in schools.
In addition to these main findings
the investigation has also identified how the Government could
take a lead role in this through procurement mechanisms which
should require contractors to demonstrate a commitment to tackling
the barriers to gender segregation in their workforce.
Recent research commissioned by the
EOC shows that 36% of the pay gap is caused by gender differences
in life-time working patterns. Rigidities in the labour market,
including those that concentrate women into particular occupations
mean that they are more likely to work in smaller and non-unionised
firms, account for a further 18% of the pay gap. 38% is due to
other factors associated with being female, including discrimination
and differences in the labour market motivations and preferences
of women as compared with men. All three of these factors will
contribute to occupational segregation. For example, women often
work in low paid sectors because it is only in these sectors that
they can access part-time working. The remaining 8% of the pay
gap is accounted for by educational attainment, since the average
woman has less years of education than the average man.
The current lack of good quality
flexible and part time jobs therefore constricts the choices women
have. Our forthcoming report on flexible and part time work is
likely to include three key recommendations for opening up access
to flexible workextension of the right to request flexible
working to parents of older children and carers; national strategies
on skills and occupational segregation to include opening up new
opportunities for flexible workers and trainees; and an effective
infrastructure of support for parents and carers, including effective
childcare and care services and financial support.
An important aspect of occupational
segregation is that women tend to work in lower paid sectors:
the 5 "c"sclerical, cleaning, catering, caring,
and cashiering. The 2001 census confirmed that women make up 84%
of employees in personal services; 78% of employees in administrative
and secretarial work and 71% of employees in sales and customer
services. The equal pay for equal work provisions of the Equal
Pay Act provides some capacity to tackle the under-rewarding of
women who work in jobs of equal weight to men; although there
are limitations to its use in practice. However, the Equal Pay
Act is not an instrument which can be used to tackle most of the
barriers described above and will not therefore, in itself, close
the pay gap.
At present, there is no statutory
duty for employers to undertake pay reviews and the EOC and others
work with them on a voluntary basis to encourage them to do so.
(16% have currently done so and a further 27% are the process
of or have plans to complete a review.) A pay review should highlight
the overall pay gap in an organisation; and it is open to employers
to take action to tackle all the causes of that pay gap, not just
pay discrimination.
The Government has set up the Women
and Work Commission to look at what action is needed to close
the pay gap and it will be reporting later this year. The EOC's
Chair, Julie Mellor, is on the Commission. A new public sector
duty to tackle gender equality is also likely to be introduced
in the next few years, which provides a more proactive model for
employers to tackle the issues they face. The Commission for Equality
and Human Rights is also expected to be established in the next
few years. The EOC has joined others in calling for a review of
equalities legislation to improve the tools available to the new
body. The time is therefore ripe for fresh thinking on the statutory
framework for closing the pay gap. A range of options are available
for consideration from a strengthening of the equal pay for equal
value provisions through to mandatory pay reviews, with encouragement
to tackle all causes; through to a proactive, general duty on
employers to promote equality and close the pay gap.
INTRODUCTION
1. The Equal Opportunities Commission (the
EOC) is a statutory body whose duties are to work towards the
elimination of sex discrimination and to promote equality of opportunity
between men and women generally. The EOC's top priority is to
close the gender pay gap and we therefore welcome the Trade and
Industry Committee's inquiry, with its specific remit to examine
the impact of occupational segregation on the gender pay gap.
STRUCTURE
2. In this submission we shall:
Consider briefly the different factors
that cause the gender pay gap and the relationship between them.
Examine in some detail the impact
of occupational segregation on the gender pay gap. This evidence
will draw heavily from evidence gathered during our general formal
investigation into the segregation of men and women in training
and work, that has been conducted using our statutory powers under
section 57(1) of the Sex Discrimination Act. [12]
We will go on to consider the impact
that a lack of access to good quality flexible and part time jobs
has on occupational segregation and finally consider the inter-relationship
between pay discrimination and occupational segregation by considering
the under-rewarding of women's work in gender segregated occupations
and the extent to which the Equal Pay Act can be used to tackle
this.
BACKGROUND
3. In March 2001 the EOC Equal Pay Task
Force reported on the findings of its year long investigation
of the gender pay gap. The Task Force had commissioned research,
consulted experts, held a public consultation, met key stakeholders
and prepared a prototype model process for carrying out equal
pay reviews. The Task Force narrowed the causes of the gender
pay gap down to three main factors: [13]
Occupational segregation.
The effect of caring on earnings.
4. A fourth factor, unequal educational
qualifications, had all but disappeared, with girls and young
women mainly outperforming their male peers. The Task Force noted
that while women themselves had taken the initiative to increase
their participation in education and to become continuous, or
almost continuous, participants in the labour market, women were
unable to change the structure of employment or the structure
of pay and reward. This makes it all the more important to come
up with ways of ensuring that pay systems are free from sex bias,
tackling levels of occupational segregation and improving access
to good quality flexible and part time work.
5. By pay discrimination we mean
paying women less than men for doing work of equal value. Pay
discrimination can be either direct eg paying a woman less than
a man for doing the same job, or indirect, eg unjustifiably paying
a woman recruit a lower starting salary than that of a man. The
EOC Code of Practice on Equal Pay recommends that employers carry
out an equal pay review as the best means of identifying and eliminating
pay discrimination in the workplace. Pay discrimination also occurs
in the wider economy, as when the rate of pay for jobs being done
by women is undervalued relative to the skills and experience
required to do the work, for example, in the childcare and home
care sectors.
6. By occupational segregation we
mean women working in jobs dominated by women and men working
in jobs dominated by men, with women being clustered into a much
narrower range of jobs than men. In some sectors, particularly
those with lower levels of pay, there are disproportionate numbers
of women, for example, almost all childcare workers are women.
In better-paid skilled trades, the situation is different. Only
8% of employees in engineering occupations are women and very
few plumbers are women. Occupational segregation has costs not
only for women, in that it channels them into low paid jobs, but
also for employers. There is a clear correlation between the sectors
experiencing skills shortages and the sectors in which women are
under-represented in the workforce. [14]
7. By the effect of caring on earnings
we mean that women, and some men, often choose to take a career
break or to work part time, because of their family responsibilities.
An extensive body of existing research reveals why women work
part-time. These reasons include: the need to combine paid employment
with caring for children or adult dependents; the lack of affordable,
accessible childcare that would enable them to work full-time;
the lower educational levels of older women and the restricted
job opportunities offered by local labour markets. These circumstances
and conditions channel women into low paid part-time work.
8. These factors have an impact not only
on current income, but also on the income that women receive in
retirement, with women currently in receipt of 57% of the pension
that men receive. [15]
9. The Equal Pay Task Force made a number
of recommendations to Government, to employers, to trade unions
and to the EOC itself. Among the key recommendations were that
the EOC should develop a model process for carrying out equal
pay reviews and that this should be incorporated into a code of
practice. The EOC acted upon these recommendations, publishing
the Equal Pay Review Kit in July 2002 and the Code of Practice
on Equal Pay in December 2003. The EOC also began a programme
of research aimed at tracking the progress of equal pay reviews
and at finding out more about the factors that contribute to the
gender pay gap.
10. Since the Equal Pay Task Force the EOC
has been working proactively across all three causes of the pay
gap. In addition to our work on pay discrimination the EOC launched
a General Formal Investigation (GFI) into occupational segregation
in May 2003 and has forged an alliance of 37 organisations, the
Parents and Carers Coalition, to highlight the issues for parents
and carers and to lobby for change. In July 2004 the EOC also
launched a GFI into flexible and part-time working.
THE FACTORS
THAT CONTRIBUTE
TO THE
GENDER PAY
GAP
11. There has been little change in the
full-time gender pay gap since the mid 1990s and in the female
part-time/male full-time pay gap since the mid 1970s. The gender
gap in hourly earnings for those employed full-time in Britain
in 2003 was 18%, while that between women working part-time and
men working full-time was 40%. Research commissioned by the EOC
used the British Household Panel Survey, a sample of around 10,000
adults, to break down the components of the gender pay gap and
has shed light on the importance of the different factors. [16]
12. The research clearly shows that the difficulties
women face in combining care and paid employment accounts for
more than a third of the pay gap. The remaining gap is largely
due to the effect of discrimination and the segregation of women
into particular occupations, with two contributing factors shown
in the pie chart below. These factors are first, the direct impact
of lower pay for "women's work," including work in non-unionised
and smaller firms as well as particular occupations dominated
by womenfor every 10 percentage points greater the proportion
of men in the workforce, the wages are 1.3% higher, even after
other factors are taken into account. The second factor is discrimination
and the other choices that women make about their career, which
can be affected by indirect discrimination as well as lack of
information. The research also shows that the fact that on average
women have spent fewer years in full time education than men accounts
for a relatively small but significant 8% of the gap. Women are
now excelling in education so the impact of this will decline,
but it is still important in limiting the opportunities of older
women and those returning to work.

13. In many instances the factors that go
to make up the gender pay gap are related to each other. For example,
the occupations with higher female participation in which women
are concentrated will often be those where a particular working
pattern, such as part-time work, is prevalentfor example,
hotel and catering; retail and distribution.
OCCUPATIONAL SEGREGATION
14. Employment in the UK remains strongly
delineated by gender, involving both "horizontal" and
"vertical" segregation. Horizontal segregation crowds
women into female-dominated occupations and industries, while
vertical segregation limits career development within industries
that would enable women to earn more by moving up into higher
paid jobs. Either way, gender segregation means that men are more
likely to work with other men and women with women.
15. On average, the occupation a man is
employed in is 68% male, while that for a woman is 32% male. Men
are more likely than women to work in a large firm: 32% of men
work in a firm of 50-499 workers, compared with only 23% of women;
and 15% of men work in a firm of 500 or more workers, compared
with only 12% of women. [17]The
higher the proportion of males in an occupation, the higher the
wages, so the fact that women are more commonly in occupations
with fewer males means that their average wages are lower.
Vertical segregation
16. The effects of horizontal and vertical
segregation are different and require different solutions. There
are a number of possible solutions to the problem of vertical
segregation which include:
There is a need to continue the improvements
being made to maternity and parental rights so as to enable a
more equal sharing of parental responsibility, thereby enabling
women to maintain their position in the labour market. This should
be underpinned by an effective infrastructure of childcare.
In order to enable both women to
make the best use of their skills and talents we need to ensure
that recruitment and selection practices are open and unbiased,
and, where appropriate, to use positive action to encourage women
to apply for jobs in which they are under-represented.
Across the UK some 20% or employees
have access to flexible working. As this figure includes employees
working part-time, this means that the type of flexibility that
enables people to balance their responsibilities at work with
those at home is available to only a minority of workers. There
is therefore a need to open up senior level jobs to flexible working
so as to enable both women and to balance their work and caring
responsibilities. As well as a benefit to women increasing access
to flexible working will also enable employers to retain skilled
staff within the business.
Discrimination within the workplace
may mean that, even where women are present in roughly equal numbers
to men, they do not gain promotion as quickly as men. Monitoring
the progression rates of women and men within the organisation
is therefore essential.
Horizontal segregation
17. The problem of horizontal segregation
is more complex, but it is important to recognise that the most
disadvantaged women experience both horizontal and vertical segregationthey
are segregated into low grade jobs in low paying sectors and are
then unable to make any further progress. While the numbers of
university-educated, mainly middle-class men and women entering
professions such as accountancy and law have more or less equalised
over the past decade, there has been no such opening up of opportunities
for the vast majority of the working population. Girls leaving
education at 16 or 18 still overwhelmingly end up in "female"
sectorschildcare, hairdressingwhile boys continue
to go into jobs in male-dominated areas, like the building trades
or engineering. Traditional notions about "men's" and
"women's" work limit their choices.
The productivity implications of occupational
segregation
18. Our investigation into occupational
segregation focused on horizontal segregation in areas of skills
shortage. We found a strong correlation between a high degree
of gender segregation and skills shortages in key areas. We conclude
that occupational segregation benefits no one. Occupational segregation
is a class as well as a gender issue, denying choice and opportunity
to girls from lower socio-economic groups especially, and hindering
social mobility.
It traps many women and girls in
low-paid, low-status jobs that do not give them the opportunity
to improve the quality of their lives, or to provide a decent
income and future for themselves and their families.
It denies young people the chance
to achieve personal or professional fulfillment by doing jobs
they would love and be good at.
It damages the competitiveness of
the UK economy by failing fully to recoup our investment in education
and training; and by ignoring opportunities to improve competitiveness
by drawing from the full pool of talent available.
It causes employers to miss out on
a huge potential pool of labour with which to cure their skills
shortages, and create a better gender mix in the workforce to
meet the needs of consumers.
19. Phase 1 of the investigation, on which
we reported last May, focused on gender segregation and inequality
within the Apprenticeship system and had the following findings:
There was a clear correlation between
a lack of women in the workforce and skills shortages.
There was a lack of data about the
breakdown by gender of those in training, and no data on Apprenticeship
pay rates.
There was marked systemic gender
segregation in all occupational sectors across all three countriesall
were heavily male-dominated except childcare, which was heavily
female-dominated. The exception was ICT in Scotland and Wales,
where women are almost equally represented on apprenticeships
(they account for only 15% in England).
While there were many specific initiatives
across Government and by employers to increase the numbers of
workers in non-traditional areas, these efforts were often insufficiently
joined up and sustained.
There were no national or local targets
for the number of women entering male-dominated areas via Apprenticeships,
although some sectoral organisations had set targets.
A bottleneck shortage of Apprenticeship
places existed in sectors with a high proportion of small businesses
and self-employment, because employers lacked adequate incentives
to offer training.
Apprenticeships perpetuated segregation
because of the lack of places, inflexibility, and a lack of childcare
support.
Pay in childcare, the only female-dominated
sector, was generally half or less of that in construction, engineering,
plumbing or ICT.
20. The report went on to make two initial
recommendations:
National strategies should be
developed for England, Scotland and Wales, driven by a high-level
alliance across Government and linked to key economic and skills
strategies, to ensure a consistent approach from all relevant
parties to tackling gender segregation in training and work. The
Scottish Executive and the Welsh Assembly should lead this work
in their countries. The strategies should incorporate effective
incentives for levering real change, including targets for measuring
progress. These strategies should provide the framework for acting
on the recommendations of both phases of this investigation.
The UK Government's planned overhaul
of the Apprenticeship scheme should include actions to address
the systemic barriers to taking on atypical recruits. In Scotland,
this should be done as part of the Scottish Executive's ongoing
review and evaluation of the "success" of the Apprenticeship
scheme. As part of this, the scheme should be made more transparent
through better data collection, and immediate action should be
taken to put all gender data on Apprenticeship frameworks and
pay in the public domain.
Other recommendations were that:
Schools and careers services should
help to widen choice for young people by providing more information
on atypical work sectors and putting more focus on promoting non-traditional
subject choices.
Learning and Skills Councils and
Local Enterprise Councils should publish annual data on Apprenticeship
frameworks, and set national and local targets to reduce segregation.
Sector Skills Councils should make
gender targets an integral part of sector recruitment targets,
rather than an add-on; audit pay rates across apprenticeship sectors;
and develop project-based apprenticeship groups for small employers
as an alternative to single employer placements.
AN APPETITE
FOR CHANGE
21. Through the course of our investigation
we talked to both young people and employers. Many people want
things to be different and there are higher levels of interest
in non-traditional work than has been recognised. There is considerable
enthusiasm for opening up the world of work among . . .
. . . Young People
Only 20% of girls said they would
not be interested in considering a non-traditional job.
A quarter of boys in England said
caring sounded interesting or very interesting, and a fifth in
Wales. Seventeen per cent of girls in England showed an interest
in technical and engineering work, and 19% in Wales; 12% and 11%
were interested in construction.
Females have stronger views
than males on whether jobs can be done by both sexes: 81% of girls
in England and 82% in Wales said males and females could be equally
good at plumbing, compared with just over half of boys in England
and 61% in Wales.
Many girls and generally a majority
of boys said they could be tempted to train for a non-traditional
job by: extra money for training; better pay rates than for jobs
normally done by their sex; the opportunity to try working in
the job before making a final choice; encouragement from others;
more information about the type of work; and more of their sex
making the same choice. [18]
At least 36% of girls would
like to try a non-traditional placement. [19]
. . . Adults
More than nine out of ten we
surveyed said they wanted children who are about to enter the
workforce to be able to make job choices free of stereotyped ideas
about men's and women's roles. [20]
Many believed more male role
models would have a positive influence on the lives of children
being cared for in nurseries.
Women in focus groups all reported
high levels of job satisfaction and that their choice of non-traditional
work had improved the quality of their lives.
Many of these women had always
wanted to do this type of work but had been put off when young.
. . . Employers
Seven in 10 England-based employers
in engineering, childcare and IT, and six in 10 in construction,
thought typical workers were a way of meeting skills shortages.
Across all sectors, 64% of employers in Wales agreed.
70% of employers in England
thought typical recruits could bring positive benefits to the
business, and eight in 10 said a better gender mix would create
a better range of skills and talents. In Wales, a smaller majority
(57%) shared this view. [21]
Employers in Scotland strongly
identified with a growing demand for female tradespeople, particularly
in construction and plumbing.
There is evidence of pockets
of flexible, women-friendly employment practices across all sectors,
including construction, mainly in response to a perceived business
need.
Employers are generally opposed
to any intervention that would require or coerce them to recruit
more atypical workers, such as targets or ring-fencing, though
they would back efforts to market non-traditional careers more
effectively. More Welsh than English employers46% versus
35%said they would be persuaded by extra funds to recruit
more atypical workers.
Barriers to change
22. Despite this appetite for change there
remain many policy, practical, attitudinal and social barriers
to building on this momentum for change:
Delivery and practice in education, careers,
and training:
No agenda is being set for schools
and Connexions to widen opportunities, challenge traditional choices,
or address young people's natural fears and concerns about working
in non-traditional areas, in contrast to the way that raising
achievement is on the agenda for all schools. So front-line practitioners
are not supported or resourced for this work and many operate
according to a freedom-of-choice model of equality that perpetuates
and even strengthens the division of opportunities, not just between
the sexes but between different social groups by failing to take
positive action to open up wider choices.
Few children are given the chance
to explore the impact of different choices on their future pay
and progression.
There is a lack of strong links
between education and industryhalf of employers we surveyed
in England and only 29% in Wales had links with secondary schools,
while only 6% in England and 14% in Wales had links with primary
schools. This means young people are not encouraged or enabled
to make the connections between what they do at school and their
occupational opportunities.
Careers information on particular
sectors is often given out only to the traditional sex, and often
presents an inaccurate or out-of-date image.
No agenda set for schools to promote and widen
opportunities through work experience:
Work experience placements,
which should be playing a crucial role in allowing young people
to test and develop ideas about non-traditional work, are in reality
reinforcing gender, class and race divisions. The onus is on individual
youngsters to find their own placements, which favours white,
middle-class children who have the resources, knowledge and contacts
to create less predictable opportunities.
Those children who cannot find
suitable placements are often allocated a vacancy in a sector
perceived as suitable for their gender, and sometimes whether
or not they have expressed interest in it.
The lack of strong education-business
links (see above) also means there is a shortage of suitable placements
for atypical candidates.
Young people's attitudes and fears:
A range of traditional attitudes
about what men and women can or should do are influencing children's
choices without being challenged.
Young people's decisions are
also affected by fears about how they may be perceived and treated
if they go into non-traditional sectors. Two thirds of male respondents
and around a third of females said they didn't want to "stand
out from the crowd" and feared the way they would be perceived
and treated.
Few boys view childcare as a
viable career, largely because of the low pay and poor employment
conditions associated with the job, and its low professional statusit
is often viewed as an extension of the "mothering" role.
This undervaluing of traditional women's work impacts negatively
not only on the pay and progression opportunities for the current
childcare workforce, predominantly women, but also makes childcare
unattractive for both sexes at a time of government expansion
of childcare services. In Scotland, girls (18%) were more likely
than boys (0%) to be studying social care, social work, youth
and community care and childcare.
Though we found limited evidence
that parents were consciously discouraging their children from
making non-traditional choices, and in some cases were supporting
them, their influence could operate in more subtle waysfor
example, there is a tendency for children from less well-off backgrounds
to follow their same-sex parent's choice of career.
Both parental aspirations and
cultural attitudes were found to be important for young people
from black and ethnic minority groups and a significant barrier
to widening their vocational choices.
There is still strong prejudice
against vocational training as a routeway into good jobs, particularly
amongst girls. In a Welsh survey of 15 and 16 year olds, only
4% of girls and 7% of boys said they would consider doing a work-based
training course at 16. The Scottish 2003 survey of school leavers
found that girls were more likely than boys to study full-time
as their main activity whereas boys were more likely to study
part-time while in a job or on a training programme. 7% of boys
were in a MA scheme, compared to 2% of girls.
Employer attitudes and practices:
Many employers in the sectors
we investigated said girls were just not interested in working
in their industries, and they were reluctant to put effort into
a "lost cause"though there was little evidence
of effort to attract or encourage non-traditional recruits.
Negative, dismissive and discriminatory
employer attitudes and practices were found to be widespread.
Both Scottish and English research uncovered perceptions, for
example, that women made unreliable trainees due to their reproductive
roles, and that employers' wives would be uncomfortable with them
having a mixed workforce.
Our research found strong evidence
that some childcare employers did not recruit men because they
thought users of their services would be suspicious of male workers'
motivationsthough all the available literature says this
concern is unfounded.
Many women in non-traditional
sectors face isolation and a culture of machismo, bullying and
harassment, often with little or no support.
Difficulties in retraining:
Adults who wish to retrain in
a non-traditional area face many barriers, which often mirror
the difficulties faced in the workplace itselfsuch as isolation,
lack of support, and no recognition of caring responsibilities.
The current funding system for Apprenticeships
favours 16 to 19 year olds so female apprentices, who tend to
be older, face further disadvantage in securing training of their
choice. Indeed this system bars both men and women from making
career changes via Apprenticeships.
Many atypical trainees said
they encountered prejudice, inflexibility and ageism from employers
when they applied for work placements, and many received no support
or practical help.
Best practice currently takes
place in women-only training centres, which tend to take a more
flexible and holistic approach, but reliable, mainstream funding
is needed to ensure their continued existence.
RECOMMENDATIONS
23. The final report of our investigation
due to be published in February is likely to make the following
recommendations. The complete draft set of recommendations is
contained in the Annex[22]
and the final report[23]
will be sent to the Committee as soon as it is available.
The Department for Education
and Skills (DfES), the National Assembly for Wales Education and
Lifelong Learning Division and the Scottish Executive Education
department in partnership with the Lifelong Learning Group, should
put in place a new national agenda for schools that promotes real
opportunity and choice and challenges the myths and stereotypes
that form from an early age.
The DfES, the National Assembly
for Wales and the Scottish Executive Education Department with
the Lifelong Learning Group, should introduce a new strategic
focus in work-related learning on widening opportunity.
The DfES should take steps to
improve policy, delivery and practice of the new 14-19 vocational
options to ensure that atypical choices are promoted and tackling
gender stereotyping should be addressed within the National Assembly
for Wales 14-19 Learning Pathways review.
The DfES, National Assembly
for Wales and the Scottish Executive Enterprise, Transport and
Lifelong Learning Department should pilot interventions that girls
and boys said would encourage them to choose atypical apprenticeships.
The Skills Alliance partners:
Confederation of British Industry (CBI), Trades Union Congress
(TUC), and Scottish TUC, Wales TUC, Learning and Skills Councils,
Local Enterprise Councils, training providers, Sector Skills Councils,
Small Business Service, the Apprenticeship Task Force and Careers
Scotland should promote the reduction of occupational segregation
not just as an equality issue but also as a business and productivity
issue, and target employers in the sectors covered by this investigation
to.
Business leaders and major employers
should work with trades unions, Learning and Skills Councils,
Local Enterprise Councils, and Sector Skills Councils to support
and promote better, more flexible employer practices that would
help and encourage more women to enter male-dominated sectors.
Trade unions should expand their
efforts to challenge occupational segregation by increasingly
including this on the agenda in collective bargaining.
Companies should be required
to report on measures taken and progress towards gender equality
and maximising human capital as part of their annual reporting.
Learning and Skills Councils,
Local Enterprise Councils, and Sector Skills Councils and training
providers should work together to develop and support training
schemes designed to meet the needs of atypical trainees, using
best practice identified through this investigation.
National procurement policy
and in particular the Office of Government Commerce and the Office
of the Deputy Prime Minister's sustainable communities agenda,
should include challenging segregation.
The Treasury Initiative to promote
women in enterprise should include a focus on attracting and supporting
women into sectors experiencing skills shortages.
The UK Government with the Scottish
Executive and the Welsh Assembly, should highlight in the national
Childcare Strategy the benefits of attracting more men into childcare
and address the gendered nature of the current workforce, including
attitudinal and practical barriers as a key objective for the
development of the new infrastructure for the national Childcare
Workforce.
The UK Government through the
Skills Alliance and the Scottish Executive through the Enterprise,
Transport and Lifelong Learning department, should identify dedicated
ring-fenced funding and resource support for the delivery of the
recommendations in this report as part of an effective national
strategy and action plan on occupational segregation.
PROCUREMENT
24. Both phases of the investigation identified
that the Government could take a lead though use of procurement
mechanisms. The phase 1 report called for greater accountability
on equality in the public sector by requiring contractors to signal
their commitment to supporting and delivering equality in apprenticeships
through their supply chain and the final report is likely to identified
the need for the National Procurement Strategy for Local Government
and the nine regional centres of procurement excellence to provide
mechanisms for building in action on procurement.
25. Every year the Government spends billions
of pounds on goods and services. Recent statistics show that the
Government spends an estimated £13 billion on civil procurement
and an additional £10 billion on defence. [24]In
England local authorities spend an additional £42.2 billion
on purchasing through private contractors. [25]
26. The legal framework in this area is
complex with both UK law and EU regulations to be considered.
However, the Local Government Best Value order 2001 and ODPM guidance
2003 make clear that local authorities may take into account the
practices of potential service providers in respect of equal opportunities
where it is relevant to the delivery of the service under the
contract.
27. The EOC would like to see that, in advance
of the forthcoming public sector duty to promote gender equality,
a more permissive approach be taken to using procurement procedures
in this way. Such an approach could be used to require contractors
to demonstrate a commitment to tackling the barriers to gender
segregation in their workforce.
28. Following the interim report of the
GFI both Secretaries of State at the DTI and the DfES responded
positively to the recommendation for a national strategy and at
a meeting of the Skills Alliance, a cross-government grouping
of Ministers and Social and Economic Partners, directed the WEU
to work with the DfES and other governments departments to draw
up a plan based on the recommendations in the EOC Phase 1 report
and to include action based on Phase 2 recommendations when available.
These plans so far include:
Careers advisors offering more
information about traditionally male jobs to schoolgirls and advising
those who want to work in these sectors.
New drive to increase the number
of female entrepreneurs starting up their own business.
Funding for universities to
help female science and engineering graduates find jobs in those
industries.
Adult education "taster
courses" for men and women in non-traditional subjects, such
as plumbing for women, and childcare for men; and
Better information for school
leavers about jobs that are dominated by one sex.
POSITIVE ACTION
29. Bringing women into manual jobs that
have traditionally been regarded, as "men's work" cannot
be achieved overnight. Women may be wary of being in a minority;
men may feel that their status is being undermined and more employers
need to be persuaded of the potential benefits to their business.
It is because of difficulties such as this that the Sex Discrimination
Act contains positive action provisions that enable employers
to take special measures to recruit and train women (or men, as
for example, in the case of childcare) for work in which they
are currently under-represented. In the past local authorities
have been leaders in the field of positive action and there is
a body of good practice that can be drawn upon. Our experience
is that a positive action programme succeeds best when:
It involves close co-operation
between the authority and the relevant trade unions.
It is well-planned and executed.
It is designed to meet a skill
shortage.
The training provided is of
a high quality.
Realistic targets are set and
their attainment monitored.
It is accompanied by the introduction
of flexible working patterns (experience in both local government
and the private sector shows that women tend to drop out once
they have started a family).
OCCUPATIONAL SEGREGATION
AND FLEXIBLE
AND PART-TIME
EMPLOYMENT
30. While working full-time is associated
with increased wages, working part-time is notnot even
pro-rata. Rather, experience of part-time employment is
associated with a reduction in wages.
For each year of part-time employment,
hourly wages decrease by 1% (in addition to missing out on the
3% gain that each year of working full-time brings);
For each year of interruptions
to employment for childcare and family care work, hourly wages
decrease by 1% (again, in addition to missing out on the 3% gain
from each year of full-time employment); [26]
31. These findings challenge the typical
assumption in human capital theory, that experience of employment
increases wages by increasing human capital. Rather, whether or
not employment experience leads to increases in wages depends
on the location of that experience within a gender differentiated
labour market. The differential impact of years spent working
part-time, as compared with full-time, has serious implications
for both women's wages and UK productivity and is worthy of policy
intervention, whether discrimination is the whole cause of the
difference or not.
32. The association between occupational
segregation and part-time work is well documented. [27]Part-time
jobs are concentrated in the less skilled sectors and occupations.
Women experience a pay penalty for working part-time and the prevalence
of women working part-time in the UK economy is a key factor affecting
the gender pay gap. The clustering of women into low paid part-time
work, and the associated under-utilization of women's skills are
key issues to be tackled if the gender pay gap is to be eliminated.
33. Research is currently being conducted
for the EOC to explore why significant proportions of the women
who work in low paid, part-time jobs do so even though they have
the potential to work in more skilled, higher status, better paid
jobs. [28]
34. The research is still ongoing. However,
an analysis of interviews conducted to date with 160 women working
part-time in 13 different workplaces indicates that about a third
have previously worked in jobs requiring more qualifications,
skills or experience than are required for their current job.
41% had previously worked in a job involving more responsibility
for supervision or management of staff than their current job.
35. The reasons for this are largely an
outcome of limited labour market and workplace opportunities and
the absence of support to enable women retain their status in
the labour market and to flourish and advance in the workplace.
Two key factors have been identified as underlying the under-use
of women's skills and experience. First, labour market conditions
can severely restrict employment opportunities for women seeking
work on a part-time basis. Second, workplace conditions and practice,
including the overly conventional approach taken to the design
of jobs; the lack of on the job training for part-time workers;
their lack of access to promotion and/or full-time employment;
and the intensity of full-time work. At present it requires considerable
resources and determination for women to break out of the low
paid sector once they become located in it.
36. Our forthcoming report on flexible and
part time working is likely to include the following recommendations
for opening access to flexible work:
The existing right to request
flexible working should be promoted to both men and women and
that the right should be quickly extended to parents of older
children and carers.
In England and Wales implementation
of the National Skills Strategy and the national strategy and
action plan on occupational segregation should specifically address
the needs of people working flexibly or part-time.
In Scotland, a national strategy
to tackle gender segregation in training and work should form
part of the key Scottish Executive economic and skills strategies.
This would complement the work being done to ensure that employers
have the right skills to support the success of their business
and individuals have the skills they need to be both employable
and personally fulfilled.
All governments major economic
and labour market policy proposals should include an equality
impact assessment. This should be done before and during the design
of the policy, not as a bolt on after policy has been formulated.
We welcome the government's
recent commitments to improve access to childcare in a more coherent
way and to increase funding for parental leave. But these changes
need to be implemented as part of a coherent package of support
for familiesthe National Family Strategy to support working
families through a nationwide infrastructure of childcare and
care services, and enhanced paid leave arrangements for parents
and carers.
OCCUPATIONAL SEGREGATION
AND THE
EQUAL PAY
ACT
37. An important aspect of occupational
segregation is that women tend to work in lower paid sectors.
The 2001 census confirmed that women remain concentrated in the
five lowest paid employment sectors and 60% of women work in just
10 occupational groups. Women make up 84% of employees in personal
services; 78% of employees in administrative and secretarial work;
and 71% of employees in sales and customer services. There are
only 9% in skilled trades; 17% as machine operatives; and only
34% are managers, senior officials and professionals. So far we
have just considered how women can be drawn into new areas of
work but we also need to consider the aspect of occupational segregation
that relates to the under-rewarding of women's work.
38. The definition of equal pay derives
from the equal pay legislation, and in the context of this Inquiry,
it is important to recognise that the Equal Pay Act was specifically
designed to deal with the under-rewarding of women's work in gender
segregated jobs. The concept of equal pay for work of equal value
(see footnote) enables comparisons to be made between jobs that
are entirely different. [29]This
means that any organisation, or part of an organisation, that
has work done predominantly by men and work done predominantly
by women, is liable to equal pay claims if one group is earning
more than the other and if the lower earning group perceives the
work as being of equal worth. While recruiting one or two employees
of the under-represented sex will not provide an organisation
with a defence against an equal pay claim, in the long-term breaking
down occupational segregation will reduce the likelihood of equal
pay claims being brought. There are, however, limitations on the
ability of the Equal Pay Act to deal with occupational segregation
and we look at these below.
39. As we have seen, the definition of the
gender pay gap derives from national and workplace level statistics.
Calculating the gender pay gap from national data produces a statistical
definition that is unlikely to reflect the gender pay gap within
a particular industrial sector, or within a specific workplace.
However, the headline statistics mask the incidence of occupational
segregation and are unable to give any indication of the existence
or whereabouts of high-risk areasthe gender pay gaps that
are most likely to give rise to equal pay claims.
40. Employers are responsible for providing
their employees with equal pay and for ensuring that pay systems
are transparent. The EOC recommends equal pay reviews as the most
appropriate method of ensuring that a pay system delivers equal
pay free from sex bias. [30]Equal
pay reviews are also a means of identifying patterns of occupational
segregation within an organisation eg women clustering in some
jobs and men in others, or women not progressing beyond certain
levels of responsibility. Whatever kind of equal pay review process
is used, the essential features are the same:
Comparing the pay of men and
women doing equal workthis includes an assessment of equal
value.
Explaining any equal pay gaps.
Eliminating those pay gaps that
cannot satisfactorily be explained on grounds other than sex.
41. At present, there is no statutory duty
for employers to undertake pay reviews and the EOC and others
work with them on a voluntary basis to encourage them to do so.
(16% have currently done so and a further 27% are the process
of or have plans to complete a review). [31]A
pay review should highlight the overall pay gap in an organisation;
and it is open to employers to take action to tackle all the causes
of that pay gap, not just pay discrimination.
The relevance of equal value to occupational segregation
42. Comparing jobs on the basis of equal
value means that jobs that are entirely different in their nature
can be used as the basis for equal pay claims. Job comparisons
can be made both within a particular pay/grading structure and
between different structures.
43. Equal value is likely to be relevant
where, as for example, in local government, men and women are
in the same employment or service but are segregated into different
types of work. Local government claims have succeeded in a wide
range of equal value comparisons, including: classroom assistants
and van drivers; nursery nurses and archivists; and kitchen assistants
and refuse workers. Occupational segregation is both about women
being paid less for work that is of equal value and about fewer
women being employed in higher paid jobs. Higher paid jobs are
not necessarily more senior jobs; they may also be jobs that attract
additional payments, such as productivity bonuses. Local government
employees, aided by unions with an understanding of how the equal
value provisions can be used to tackle the impact of occupational
segregation on women's pay, have made good use of the equal pay
legislation, and will continue to do so until the underlying issue
of occupational segregation has been tackled.
44. However, there are severe limitations
on the ability of the Equal Pay Act to tackle the undervaluing
of women's work:
The Equal Pay Act deals with
individual instances of discrimination when they occur, but it
is not geared to tackling the underlying causes of inequality
in a systematic way.
A woman is unlikely to be able
to succeed in an equal pay claim brought against a man in a post
senior to her own in terms of the demands of the job, and thus
the equal pay legislation does not provide a means of tackling
vertical segregationfewer women being employed in more
senior posts.
A woman can only bring a claim
in respect of a comparison with a man in the same employment as
her. Women working in female dominated workplaces are unlikely
to be able to find a male comparator; this is especially true
of women working part-time. It is only where (as in local government)
the workforce is sufficiently large to provide a range of comparators,
that women are able to make use of the Equal Pay Act to challenge
the unequal pay associated with occupational segregation.
Young people are generally unaware
of the rates of pay for different jobs. This makes it unlikely
that they would know that they could, in some circumstances, be
able to ask for equal pay.
CONCLUSION
45. It is in our individual, business, and
wider economic and social interests to do things differently.
Abolishing gender segregation will not be an easy task. It is
a challenging and complex issue that goes right to the heart of
our economy and society. But we believe the momentum for change
is building. We believe that some of the difficulty in closing
the pay gap stems from the fact that the issue of equal pay has
been separated from that of occupational segregation but as we
have demonstrated there is an clear link between each cause of
the pay gap and action of all causes is necessary to deliver change.
46. Policy makers, employers and trade unions
need to recognise the connection between the different factors
and to take action to open up opportunities to both women and
men. Women need to be able to maximise their earnings and their
hours of work, and to be enabled to reach their full potential;
men need to be able to make the trade-off between earnings and
hours of work that is currently often only available to women
with access to part-time jobs; men and women to combine work with
their domestic responsibilities, whatever their level of seniority.
47. Employers can use equal pay reviews
not just to look at pay discrimination but to go beyond the scope
of the law and use a review to examine all of the causes of the
gender pay within their own organisations to ensure that they
are maximising the potential of their whole workforce. Government
should also take national, strategic action of all three causes
of the pay gap and we have highlighted in this paper some of the
ways in which this agenda can move forward. This will reduce skill
shortages and increase productivity and UK competitiveness.
48. The Government has set up the Women
and Work Commission to look at what action is needed to close
the pay gap and it will be reporting later this year. The EOC's
Chair, Julie Mellor, is on the Commission. A new public sector
duty to tackle gender equality is also likely to be introduced
in the next few years, which provides a more proactive model for
employers to tackle the issues they face. The Commission for Equality
and Human Rights is also expected to be established in the next
few years. The EOC has joined others in calling for a review of
equalities legislation to improve the tools available to the new
body. The time is therefore ripe for fresh thinking on the statutory
framework for closing the pay gap. A range of options are available
for consideration from a strengthening of the equal pay for equal
value provisions through to mandatory pay reviews, with encouragement
to tackle all causes; through to a proactive, general duty on
employers to promote equality and close the pay gap.
31 January 2005
The same, or broadly similar, (known
as like work)
Different, but which is rated under the
same job evaluation scheme as equivalent to hers, even if the
evaluations were carried out at different times (known as work
rated as equivalent), or is
Different, but of equal value in
terms of demands such as effort, skill and decision-making, (known
as work of equal value).
12 The investigation, launched in May 2003 will publish
its findings in February 2004. The investigation focused on five
sectors (construction, engineering, plumbing, Information and
Communications Technology and childcare) but makes the case for
addressing stereotyping and segregation more widely in our economy.
The evidence base for the investigation included: A BRMB survey
of attitudes towards jobs traditionally done by women or men,
research amongst employers, young people, women in non-traditional
training and work and key stakeholders including Learning and
Skills Councils. Back
13
Just Pay: the report of the Equal Pay Task Force EOC 2001. Back
14
Plugging Britain's skills gap: challenging gender segregation
in training and work May 2004. Back
15
Based on women's median income in retirement, ONS 2004. Back
16
Modelling gender pay gaps; Wendy Olsen (University of Manchester),
Sylvia Walby (University of Leeds), EOC Working Papers series
No 17, 2004. Back
17
ibid. Back
18
Statistics from survey of 1,281 year 10 pupils in eight schools
with varying characteristics and performance and Wales. Back
19
Statistics from work experience survey of 566 pupils in 20 schools
in England. Back
20
Survey of 1,100 adults aged 16-59. Back
21
Survey of 140 apprenticeship employers In England and Wales. Back
22
Not printed. Back
23
The final report was published in March 2005 and is available
from the EOC's website: www.eoc.org.uk/segregation. Back
24
"Modernising Procurement" (1999) and DASA, Defence
Statistics (2001). These cover every aspect of procurement including
determining the need for goods and services as well as buying
delivering and storing them. Back
25
Estimates vary widely. Local Government Procurement Taskforce,
Delivering Better Services for Citizens, July 2001. Back
26
ibid. Back
27
See for example, Fourth Report of the Low Pay Commission. Back
28
Low paid part time work why do women work below their potential?
Linda Grant et al, forthcoming. Back
29
Claiming equal pay. The Equal Pay Act 1970, as amended, gives
women (or men) a right to equal pay for equal work. An employer
can pay a man more than a woman for doing equal work, but only
if there is a genuine reason for doing so which is not related
to sex. The Act entitles a woman doing equal work with a man in
the same employment or service to equality in pay and terms and
conditions. It does so by giving her the right to equality in
the terms of her contract of employment. The man with whom she
is claiming equal pay is known as her comparator. A woman can
claim equal pay for equal work with a comparator doing work that
is: Back
30
EOC Code of Practice on Equal Pay. Back
31
Monitoring progress on equal pay reviews, Brett and Milsom, EOC
2004. Back
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