Lynne
Featherstone: Forgive me, Mr. Benton,
but are we not on amendment 258?
The
Chairman: The Question is that clause 65 stand part of the
Bill.
Dr.
Harris: On a point of order, Mr. Benton. May I
apologise? The reason for the confusion is that we tabled an amendment
to leave out the clause, but that is not printed on the list. My hon.
Friend’s intention is to speak briefly to clause stand part,
because there is an argument to leave it out, if that would be
acceptable—despite the double attempt to move that
proposal. 11.45
am
The
Chairman: One grows used to such things. To clarify,
amendment 258 was not selected and therefore cannot be moved. However,
I will allow a discussion on clause 65 stand
part.
Lynne
Featherstone: Thank you, Mr. Benton, you are
very kind. I thank the Committee for its patience.
The threshold
for bringing an equal pay case is higher than for direct
discrimination—it is more difficult to bring a case. That is
because a person must find a real comparator against which they can
show that they are being discriminated against, which is not always
possible, and a person who discriminates can use the material factor
defence where one exists. Neither of those hurdles applies in direct
discrimination
cases. Being
paid differently because of gender is clearly a detriment. Rather than
impose a higher threshold to be able to take a case to end pay
discrimination, the Bill should make it easier to take action. The
scale of pay discrimination against women should make us favour
concrete measures that make ending such discrimination easier. Removing
the clause would enhance protection for people who face pay
discrimination because of their gender. Where they cannot find a real
comparator, or the discriminator finds a spurious material factor
defence, the door would still be open to take a direct discrimination
case. On that basis, I wanted to argue against the clause.
The
Solicitor-General: I do not know whether the hon. Lady
seeks to remove the clause on the basis that it would change the
existing law. The short answer is that it would not. That is our firm
conviction, and I am happy to explain why. I do not wish to put her in
a hot spot, but if she thought that the clause would change existing
law, I can explain why it would not outside the Committee if that is
quicker.
Dr.
Harris: It is not our suggestion that the clause would
change the existing law. We contend that the existing law has not
worked. The fact that one has to go through this route to make the
claim is one of the many reasons why it has not worked, and we know
that the Government share our concern.
The
Solicitor-General: Then I will set out how we think the
provisions work. The sex discrimination provisions of the Bill do not
apply where the equality clause or rule provisions operate. It is right
to ensure that a remedy for a particular wrong is a single specified
remedy rather than a matter of choice from a menu, and that is what the
clause achieves. We have already discussed our general approach to
equal pay in the Bill. Essentially, equal pay is contract-based,
achieved by modifying or reading in a term of an employee’s
contract of employment to ensure equality with a colleague of the
opposite sex doing equal work. We have maintained that position in the
equality clause provisions of the Bill.
In “A
Framework for Fairness”, we consulted on whether to maintain
that contractual approach, and a significant majority of respondents
favoured it, although I recognise that some take a contrary view. We
have tried to adjust the relationship between equal pay and the
discrimination provisions to ensure that there is no gap by allowing
claims of direct discrimination in respect of contractual pay. I think
that I said that in a previous debate as well. As we have already
discussed, we believe that doing away with the separate contractual
approach could lead to considerable uncertainty and
confusion. The
sex discrimination provisions listed in the table apply only to
non-contractual pay and benefits such as promotion, transfer and
training and to offers of employment or appointment to office, except
as provided
by clause 66 in respect of direct discrimination. For example, if a
company offers more training or promotion opportunities to men because
it believes they will stay longer than women, a claim of sex
discrimination by the women would come under the sex discrimination
provisions. If it is not clear—this might be what is concerning
the hon. Lady—whether a particular claim relates to benefits
that are contractual or non-contractual, it can be made, as is
currently the case, under both provisions, and the tribunal will, to
put it in technical language, sort it
out. The clause
also maintains the distinction between the provisions for equality in
terms of occupational pension schemes and the provisions that prohibit
sex discrimination in giving access to such a scheme. It is worth
pointing out that where a woman cannot identify a comparator doing
equal work and wants to make a claim involving contract terms not
relating to pay, such as promotion, the sex discrimination provisions
will apply to such a claim. Again, the position is the same as before.
I understand the change that the hon. Lady seeks, but the Government
see the clause as an essential aspect of the functioning of the Bill. I
hope that the Committee will therefore agree that it should stand part
of the
Bill.
Lynne
Featherstone: It is extremely helpful to have such a
cogent explanation of what the clause does and does not do, and what
the law would probably say and not say in interpreting it in future, so
I thank the
Minister. Question
put and agreed
to. Clause
65 accordingly ordered to stand part of the
Bill. Clauses
66 to 71 ordered to stand part of the
Bill.
Clause
72Discussions
with
colleagues Question
proposed, That the clause stand part of the
Bill.
John
Penrose: The clause is important and I wish merely to put
on the record my party’s support for it. As the explanatory note
says, it is
designed “to
protect people who discuss their pay with
colleagues” and
to ensure that if any firm seeks to impose a pay secrecy clause, which
might be a mechanism for covering up gender pay inequality, it does not
work and cannot be applied. I state on the record my party’s
thorough support for the clause. It will be particularly important when
we come to discuss the wider issue of gender pay audits in clause 73.
It is, in our view, a thoroughly sensible and proportionate way of
attacking part of the problems of the gender pay gap. It is entirely
reasonable and proportionate to the problem in hand. I just wanted to
ensure that it was on the record that my party is thoroughly in favour
of the clause and will support
it.
Lynne
Featherstone: I, too, welcome the clause. By introducing
it, the Government will have rolled back some of the disparities and
the secrecy that there has been around pay since time immemorial. That
is one of the great inhibitors to individuals being able to know
whether they have something to be aggrieved about. The clause is a
start but, when we come to the next clause, we shall expand on the
issue far more widely.
The
Solicitor-General: I am grateful that both Opposition
parties have said that they support the clause. The Government think
that it is necessary and a good move forward, as they do. For the sake
of clarity, I emphasise that the clause does not require anyone to
disclose their pay if they do not want to. It does not stop employers
preventing employees from discussing their pay with or disclosing it to
competitors or other people who are not colleagues of the employee, so
it should not have any unintended consequences. We think, as colleagues
do, that the clause is a useful tool to promote pay transparency and
hence
equality. Question
put and agreed
to. Clause
72 accordingly ordered to stand part of the
Bill.
Clause
73Gender
pay gap
information
Lynne
Featherstone: I beg to move amendment 248, in clause 73,
page 55, line 19, leave out ‘250’ and insert
‘100’. An
amendment to reduce the number of people an organisation must employ in
order to be subject to the gender pay gap clause
requirements.
The
Chairman: With this it will be convenient to discuss new
clause 23— Gender pay gap information
(No.2)— ‘(1) Subject to
the provisions of this section, no less than every three years a
designated employer shall publish information relating to the pay of
its employees for the purpose of showing whether there are differences
in the pay of male and female
employees. (2) The information
relating to pay which a designated employer shall publish
includes— (a) the
average hourly pay of male workers and the average hourly pay of female
workers within its
employment; (b) in respect of
each role within the
organisation— (i) the
average pay awarded to workers engaged in the
role; (ii) the percentage of
men and women engaged in that
role; (iii) the gap, if any,
between the average hourly pay of male and female employees in that
role; and (iv) the average
length of service of men and women engaged in that
role; (c) information
identifying— (i)
any descriptions of activities carried out in the
course of employment with the employer by any group of workers who are
wholly or mainly women; (ii)
any descriptions of activities carried out in the
course of employment with the employer by any group of workers who are
wholly or mainly women; (iii)
the relative values of the descriptions of activities falling within
sub-paragraphs (i) and (ii);
and (iv) in relating to
descriptions of activities within sub-paragraphs (i) and (ii) which are
judged to be of equal value to each other, the average hourly pay of
male workers and average hourly pay of female workers carrying on those
activities. (3) For the
purposes of this section, “pay” means the ordinary basic
or minimum wage or salary and any other consideration, whether in cash
or kind, which the worker receives directly or indirectly, in respect
of his employment, from his employer and includes the cost to the
employer of—
(a) any pensions contributions paid by the employer
in respect of the
worker, (b)
any bonus or other performance related or incentive payment,
and (c) any discretionary
benefit granted to a worker in connection with his or her
employment. (4) The Secretary
of State shall prescribe by regulations any further information which
employers must publish pursuant to subsection (1), the form in which
the information must be published, and the degree of publicity to be
made. (5) In make such
regulations the Secretary of State shall adopt best practice for
promoting awareness of the nature and causes of any pay gap between
persons of different genders as set out by the International Labour
Organisation from time to
time. (6) The Secretary of
State shall consult with the Equality and Human Rights Commission as to
how to ensure that the regulations shall contain best practice prior to
the making of the first regulations and no less than every five years
thereafter and shall amend the regulations as necessary to ensure that
best practice is
maintained. (7) Where an
employer fails to publish information in accordance with this section
then an employer shall not be entitled to submit a material factor
defence in accordance with section 64 in relation to any period for
which they are in breach of their obligations under this
section. (8) Where the
information published by an employer reveals that there is a difference
in the average pay of men and women doing relevant types of work as set
out in section 59, then in any proceedings to enforce a sex equality
rule or a sex equality clause it shall be presumed that there is such a
breach unless the employer can show a material factor
defence. (9) The regulations
may make provision for a failure to comply with the
regulations— (a) to be
an offence punishable on summary conviction by a fine not exceeding
level 5 on the standard
scale; (b) to be enforced,
otherwise than as an offence, by such means as is
prescribed. (10) The reference
to a failure to comply with the regulations includes a reference to a
failure by a person acting on behalf of an
employer. (11) An employer
shall publish information pursuant to subsection (1) within one year of
the coming into force of this
Act. (12) Where an employer (A)
is able to determine the terms and conditions of employment as between
another employer (B) and its employees, A shall publish the information
that B would otherwise be required to publish in a way which is
consolidated with the information for all other employees of A whose
terms and conditions A may determine, and where A publishes
consolidated information B shall not be in breach of this section if it
does not publish any
information. (13) A designated
employer means an employer who has more than 100
employees.’.
Lynne
Featherstone: The amendment is designed to probe the
Government on the decision that they have made on the number of
employees that an organisation must employ to be subject to the gender
pay gap clause requirements when they arise. The Government
refer to 250 employees in the private sector. I do not fully understand
why that number has been selected. In our evidence session, reference
was made to a reduced number. Women Like Us said that organisations
with 100-plus employees often have dedicated human resource departments
or facilities, so issues would not be too onerous as such departments
should be able to contribute their experience of auditing. It was also
said that the reference to 250 employees leaves out of the gender pay
audit requirement a huge proportion of businesses in the United
Kingdom. About half the people in the United Kingdom are employed in
businesses with fewer
than 250 members of staff, so huge sectors of the population would not
be provided with protection under the Bill, when the regulations come
into force. Given that 80 per cent. of the population are not employed
in the public sector, will the Minister explain why the figure of 250
employees has been
chosen? I
am saving some remarks to the end of the debate, but I now move to new
clause 23. It would extend the period for publishing information to
three years. That is a reasonable timetable. It would not be too
onerous, nor would it be so irregular as to be out of date.
Subsection (2) of the new clause deals with the information
that must be published and would distinguish the differentials between
male and female pay in an organisation. The information published under
paragraph (c) would highlight discrimination in the types of work
undertaken wholly or mainly by women so that we can see what is being
done and by whom, how that work is valued, whether it is of equal value
and whether the pay demonstrates an unjustified differential or a
legitimate aim subject to the defence of a material
factor. In
our evidence session, we heard from the Fawcett Society that, if we are
to eradicate discrimination and unequal pay, we have to evaluate the
skills and experience that are required for jobs and check whether
individuals in equivalent jobs are being paid equivalent salaries. That
is why new clause 23 proposes publishing both the levels and types of
work. Women’s work is often undervalued and major cases have
involved equal value in the public sector. That undervalue has
delivered low pay for women for decades. It has not been adequate
simply to have provisions that make that illegal, which is why pay
audits are necessary they make sure that checks are in place so that
people are not discriminated
against. It
is only by seeing how people are treated compared with others at levels
and types of work that we will ever be able to bring a case to a
tribunal to right those wrongs. If we cannot find that out, the gagging
clauses that we referred to earlier, while they are extremely welcome
and helpful—for which I say, “Well done” to the
Government—will not give the overall picture to enable an
individual to make a judgment about a company’s relative pay or
jobs. The
Conservative amendment of only imposing mandatory pay audits when there
is a finding against a company will not work. It seems to be logical to
punish when there is something judged to be punishable, but the reality
is that such a policy will not address unequal pay because the
individuals cannot get the evidence to bring the matter to a tribunal
to get the judgment. As I understand it, the company would be required
to publish mandatory pay audits thereafter. That will not address the
issue in the first place. It will not provide the
evidence.
12
noon
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