Business, Innovation and Skills CommitteeWritten evidence submitted by Public and Commercial Services Union (PCS)

Background

The Public and Commercial Services Union (PCS) is one of the largest trade unions in the UK, with over a quarter of a million members. We are organised throughout the civil service and government agencies, as well as in the private sector, usually in areas that have been privatised.

PCS is a democratic organisation, run by our members, for our members. We campaign for fair pay and conditions, decent pensions for all and equality in the workplace and beyond. Equality is at the heart of everything we do.

Women in the Workplace

1. Do the Gender Equality Duty and the Equality Act go far enough in tackling inequalities, such as gender pay gap and job segregation, between men and women in the workplace?

Gender Equality Duty and Equality Act

The Gender Equality Duty (GED) was a useful tool to hold public bodies to account on gender equality. The GED, which came in to force in April 2007, created new legal requirements for public authorities. It was brought into being because existing legislation was insufficient to eradicate the persistent and systematic discrimination against women.

The GED was superseded by the Equality Act 2010 in April 2011 and specifically by the Single Public Sector Equality Duty (PSED).

1. The Equality Act 2010 is a fairly new piece of legislation and as such it may be too early to evaluate its effectiveness. However, the changes introduced to the specific duties appear to have been designed to reduce challenges to public authorities compliance with their general duty (PSED), such challenges often triggered by evidence published by the authorities themselves of obviously inadequate engagement with the duty, in particular in the equality analysis.

2. PCS is concerned though that the message coming from government is that these types of legislation are a burden on business efficiency—something that PCS does not accept.

We are particularly concerned by:

The Prime Minister’s announcement to the CBI that the government intends to end equality assessments in war on “red tape”

Weakening the Equality Act

Reform, including very damaging budget-cuts, of the Equality & Human Rights Commission.

PCS represents over 250 staff at the Equality and Human Rights Commission—an independent body responsible for enforcing equality legislation on age, disability, gender, race, religion or belief, sexual orientation or transgender status, and encouraging compliance with the Human Rights Act.

In its first two years the Commission:

ensured protection for 6 million carers against discrimination in employment;

answered over 70,000 contacts a year to the Helpline;

resolved 80% of enforcement cases without the need to go to court;

advised 136,000 businesses about upholding equality during the downturn; and

distributed £10 million in grants to 285 different voluntary groups delivering frontline services across the country.

The work of the EHRC is now under threat. The government plans to slash its budget by 68% (compared to when it was set up in 2007).

It is likely to:

lose more than half its workforce;

reduce its legal enforcement ability;

close its Helpline to the public, business and the public sector;

lose its regional offices; and

end its grants to charities or projects disability groups and community organisations that are often the first port of call for victims of discrimination and harassment.

At a time of unprecedented cuts that will hit the most vulnerable in society hardest, the EHRC is more vital than ever.

3. It is important to have legislation in place that requires public sector organisations to consider equality issues when deciding policy—furthermore, this helps to embed equality in public service provision.

4. While some progress has been made with regards to equality in the areas of pay and status in the workplace, there is still clearly a long way to go.

5. Currently, many aspects of government policy seem to be in contention with achieving equality. But rather than address the points of policy that work against achieving equality, the government appears to be seeking to instead to alter equality principles and targets.

Shortcomings of the Equality Act 2010

1. The Equality Act 2010 does not establish new procedures for providing arbitration in equal pay disputes nor does it impose positive duties on employers to take steps to monitor and respond to pattern of pay inequality.

2. Combined with the absence of positive duties to monitor and act upon patterns of pay inequality, it is difficult to use equal pay legislation to challenge patterns of unequal pay linked to occupational segregation (eg the clustering of women in particular categories of low paid jobs) as finding male comparators in such circumstances often proves difficult.

3. In July 2008, the UN Convention on the Elimination of Discrimination against Women’s (CEDAW) monitoring Committee published its most recent report on the UKs compliance with CEDAW. They expressed particular concern about the persistence of occupational segregation between women and men in the labour market and the continuing pay gap, one of the highest in Europe.

4. PCS recommends that employers take proactive and concrete measures to eliminate occupational segregation and to close the pay gap between women and men, including through the introduction of mandatory pay audits.

5. The equal pay provisions of the ACT represent a wasted opportunity to enhance protection against gender inequality by clarifying and improving a complex and increasingly outmoded area of law.

6. The existing equal pay framework also struggles to address issues of occupational segregation, identified by the CEDAW Committee as a persistent problem with contributes greatly to the size of the pay gap between men and women in the UK.

7. We consider that the equal pay provisions would benefit from the establishment of new arbitration mechanisms, the introduction of positive duties upon employers in certain circumstances to take steps to monitor and respond to pattern of pay inequality.

2. What steps should be taken to provide greater transparency on pay and other issues, such as workforce composition?

Transparency

PCS believes complete transparency on pay and other issues is prerequisite for achieving equality and also for collective bargaining purposes. This applies to both the public and private sectors, but while there has been significant progress in this area in the public sector the private sector still has much progress to make and could learn from best practice in the public sector.

It is often difficult for individual women to identify where they are being paid less than men doing equal work to them because of the lack of transparency around pay in many workplaces, especially in the private sector.

Section 78 of the Act, if it had been enacted, would have provided regulations requiring private employers with at least 250 employees to publish information relating to the pay of employees for the purpose of showing whether, by reference to factors of such description as are prescribed; there are differences in the pay of male and female employees.

This provision came as something of a disappointment to trade unions lobbying for the adoption of mandatory pay audits, such audits requiring as a first step the gathering and dissemination of detailed information about pay levels in predominantly male and female jobs, pay levels for men and women by levels of seniority and so on.

The Equal Pay Code of Practice recommends equal pay audits as the most effective way of establishing whether an organisation is in fact providing equal pay. Unfortunately it is not in the main body of the act and is a recommendation rather than a statutory duty.

Pay systems in the civil service are open and transparent, with clearly defined grade structures. Furthermore roles and grades are set as part of “job appraisal” procedures and importantly civil service employers negotiate with trade unions that represent civil servants in setting pay and grading.

PCS would support mandatory pay audits in all sectors of the economy.

PRP and bonus payments

PCS believes there to be issues with both performance-related pay and bonus payments—both of which are creeping into public services. The concerns PCS has about these areas are very much about a lack of transparency related to these areas and to what often outwardly appears to discriminatory outcomes from these processes. Our experience is that they cause resentment and poor morale.

3. What has been the Impact of economic crisis on female employment and wage levels?

Since the onset of the finance sector inspired economic downturn and the ensuing austerity measures introduced in the areas of public services and welfare, there has been a wealth of academic research which highlights the fact that women are suffering the effects disproportionately in comparison to men.

Women make up a higher percentage of public sector workers (when part time workers are included) and this means that women in the UK are disproportionately affected by job cuts and pay stagnation in the public sector.

The ONS records that in the civil service there are 244,210 female workers compared to 215,270 male workers (counting full-time and part-time).

The Fawcett Society notes that:

“Moves to reduce the country’s deficit have left women facing a “triple jeopardy” of slashed benefits, job cuts, and a reduction in the core public services they rely on for themselves and those they care for.”

Furthermore PCS would fully commend, and wholly support, the finds in the same organisation’s most recent comprehensive analysis on the issue: “The Impact of Austerity on Women” March 20121 and a TUC report published in November 2011: “The gender impact of the cuts—a year on”,2 which in summary noted:

“We have seen how the government’s attack on the public sector is having a disproportionate and disastrous effect on women in three main ways:

More women will lose their jobs simply due to the fact that significantly more women than men are employed in the public sector.

Women are more reliant on the services that the public sector provides and therefore stand to lose more from cuts to services.

Women are more likely to depend on the welfare system and will be hit hard by cuts to benefits.

The unfairness of the government’s attacks on the public sector has been widely recognised, not just by the trade union movement, but by much of the national press, the NGO and charity sector, community groups, religious organisations, many academics, and a range of think tanks.

On an almost daily basis, the government announces new policies that will have a negative impact upon women. The abolition of the Women’s National Commission, cut backs and a review of the functions of the Equality and Human Rights Commission, and cuts to legal aid are just a few examples of recent government announcements, before and since the CSR, which will have a direct, negative effect on women.”

While the Women’s Budget Group, in response to the 2012 Budget, noted:

“The Office for Budget Responsibility has increased its estimate of how many jobs will be lost in the public sector between the beginning of 2011 and the start of 2017 to 730,000. Women account for two thirds of employment in the public sector, and therefore will face the brunt of these losses. Women’s unemployment is at the highest level in 25 years; and women account for two thirds of the latest monthly increase in unemployment.

Many women who do have a job face the prospect of further reductions in their real earnings. Just before the Budget, the government announced that the minimum wage for young people will be frozen for 201213. Even the for older workers the 11p rise is a cut in real terms. Women make up the majority of those on the minimum wage.

The Chancellor wants to introduce “regional pay” in the public sector, to reduce the gap between earnings in the public sector and the private sector. Lower income women—home helps and dinner ladies, for instance, will be disproportionately affected by this.”

While the Daily Telegraph, wrote in December 2011, that:

“Government figures show that almost 12 million women will be affected by changes to tax credits and public sector pensions, compared with just 5.3 million men. An analysis shows that women will lose £1.7 billion, compared with just £640 million lost by men. Changes to tax credits alone will cost households £1,200 each.

“The Coalition has repeatedly come under attack over the effect of its policies on women from groups such as the Women’s Institute. A forum of 37 Conservative MPs has also warned that more could be done for female voters.”

Membership Survey

The UK government’s own statistics show that the cost of living will rise by 19.4% between 2010 and 2014. During that time the vast majority of PCS members in the public sector have had a two-year wage freeze—followed by two pay rounds with a maximum rise of 1%.

The pension contributions made by most civil servants from their wages increased in April 2012 and for many will treble by April 2014.

In that context PCS carried out a pay survey. Across all regions and in all age ranges incomes are falling, prices are rising and debt is growing. Remembering that women are in the majority in PCS membership and civil service employment, findings included:

Monthly average loss of income = £100

88% worse of as a result of the last Budget

90% had to cut down spending in the last six months (at time of survey)

70% had borrowed money in the last six months

Monthly average borrowing = £300

55% said they could not live on their salary alone

70% said their income was down in the last six months

On average members said they were approximately £69 a month worse off due to benefit changes.

Nearly 70% of people are experiencing high levels of stress—with women in particular suffering the highest levels of stress.

And an example of a member’s response:

“Got a 10mth old baby and all my outgoings and bills have increased and with the pay freeze and increase in pension contributions I’m not sure that my incomings will continue to exceed my outgoings but think that actually I’ll be short each month.”

While another said when asked about financial loss as a result of government policy:

“Over £200 per month because of money taken by government for my pension, family tax credit taken away, no EMA but increased costs of travel to college, books and stationary for my son, pay freeze, but cost of living gone up, changed my mortgage to a repayment only.”

Women are also suffering a disproportionate effect from the government’s social welfare cuts.

According to campaigning groups the Fawcett Society and the Women’s Budget Group, more than 70% of the £18bn cuts to social security and welfare will fall on women. While one-fifth of the female wage consists of benefits to compensate, for instance, for the low wages associated with female-dominated sectors such as care and retail—benefits make up only one-tenth of the male wage.

Ongoing “Reform” in the Civil Service

As well as facing public sector-wide attacks on jobs, pay and pensions, PCS members are now also facing very severe attack on long established terms and conditions that go to the heart of women’s ability to maintain employment and a family life. In October 2012 a leaked Cabinet Office document revealed that the government is proposing to relook at things like:

Working hours

Holiday entitlement

Access to childcare

Sick leave and pay

Flexi working

Parental leave

Part-time, term-time and compressed hours working

Relocation & redeployment.

The stated aim of this review is to reduce and curtail the above, to the level of the private sector. But instead PCS believes that private sector workers should be able to avail themselves of the terms and conditions available in the public sector rather than a race-to-the-bottom as being proposed by the government, so that HR best practice is available to all women.

Outsourcing

PCS also believes that the government’s policy of outsourcing and privatising public services, while providing no proof that the private sector can deliver services more efficiently or cost-effectively, certainly has a detrimental effect on the workers who have been outsourced and privatised. Evidence has shown that, as a result of outsourcing and privatisation, employees pay, terms and conditions, and pensions are eroded over time.

4. How should the gender stereotyping prevalent in particular occupations, for example in engineering, banking, construction, and the beauty industry, be tackled?

The stereotypical belief is that if women in managerial positions possess traditional male characteristic it is a better predictor for success, which reinforces the belief of “think manager-think male” and this discriminates against women reaching the higher positions with characteristics commonly associated with females.

Since construction is one of the highest male dominated industries, the effect of stereotypes as a barrier for women’s career progression in construction is salient. The culture in the construction industry is extremely male dominated. As a result of this, gender stereotypes are salient in construction organisations as direct antecedents of discrimination of women at work.

The norm characteristics of managers in construction are perceived as masculine. They restrict women from entering, promoting and training in the industry. The lack of female role models, diversity training and poor implementation of initiatives and policies on equal opportunities can be identified as the main barriers to reduce prevailing stereotypes in the industry.

In brief, it can be inferred that to improve the status of women’s career advancement in the construction industry it is essential to reduce the influence of occupational gender stereotypes on women managers through a holistic approach of organisations, authorities, research and development institutions and society as a whole.

5. What more should be done to promote part time work at all levels of the workplace and to ensure that both women and men have opportunities to gain senior positions within an organisation while working part time?

The economic system in the UK means that it is often not financially viable for a woman to work part-time where they may wish to. This is because pay is too low in comparison to the cost-of-living and is made worse by the further cuts to tax credits announced recently.

And a 2012 report by the Resolution Foundation: “The price of motherhood—women and part-time work”3 notes that:

“Women in the UK are also more likely than in the five countries with the highest rates of female employment to switch to part-time work once they have children. Although this is often a positive choice to balance work and family life, it is more common for women in the UK to remain working part-time after their children have reached school age, a point at which many women in other countries choose to extend their working hours. On average, nearly 45% of mothers of school-age children work 40 hours or more per week in the OECD compared to less than 20% of British mothers of school-age children. Just over 50% of mothers with school-age children work fewer than 20 hours a week in the UK compared to an OECD average of 30%.

“The UK has one of the highest part-time pay penalties in the European Union. This is largely because of the occupational segregation between full and part-time work which unduly affects women who are far more likely than men to work part-time. Women who switch to part-time employment tend to move down the occupational ladder into lower skilled and lower paid jobs and struggle to move between full and part-time employment as their family situation changes. This means that, while the part-time pay gap within any one occupation is relatively small, women who switch from full to part-time employment when they have children stand to lose a significant amount of income if, in doing so, they are forced to also take a lower skilled job.”

6. To what extent have the recommendations in Lord Mervyn Davies Report “Women on Board” been acted upon?

PCS represents around 165,000 women members, who are predominantly located in public sector employment.

The issue of women on boards is far removed from the day-to-day life of our members.

However, PCS recognises the importance of addressing issues relating to gender equality and women represented in public life in general.

PCS has at least two concerns with the lack of women in senior positions.

Firstly, it is totally unacceptable that the employment market in the UK is structured so that women find it very difficult to compete with men for the top posts on an equitable basis. This is a long-standing issue to which many organisations such as the Fawcett Society have recommended solutions but which successive governments have not had to courage to implement. Education, careers guidance, career barriers, childcare, stereotyping, access to family-friendly HR policies, job status, working environment etc all play a role.

Secondly we have a position where men are in positions of decision-making that affect women’s lives in areas such as pay, cost-of-living and work/life balance—which would benefit from the experience of women in the workplace.

This might also apply to people from different social backgrounds.

7. To what extent should investors take into account the percentage of women on boards, when considering company reporting and appointment to the board?

The positive action provisions in the Act allow employers to take steps in order to advance equality for people who may be under-represented in a particular activity, have suffered a disadvantage or have different needs related to one of the protected characteristics.

By taking positive action this will help them create a more diverse workforce with all the benefits that brings, for example a wider pool of talented people from which to recruit, more creative teams, a workforce that is more responsive to a diverse customer base or service users.

8. Why are there still so few women in senior positions on boards and what are the benefits of having a greater number?

The number of women on boards in UK governing bodies across a wide range of sectors shows no cause for celebration either.

In 2012, housing associations fared best with 40% of board roles occupied by women, followed by NHS foundation trusts (37%), top charities (34%), government departments (32%) and non-departmental public bodies (28%).

Women bring different perspectives that help to drive new insights, while they can create a more collaborative and reflective atmosphere that helps boards work better together.

Even more importantly, in a world where talent is seen as a key source of competitive advantage, the cost of losing many of your potentially most valuable management resources is recognised as huge. Why would any organisation want to select its leaders from only one half of the population?

Reflecting the customer base

It is anomalous and unhealthy for senior management ranks to have low female representation, when women account for the vast majority of their customer base.

Employers need to enhance gender diversity as even the most successful companies are finding that this progress is patchy both across geographies and across different functional areas, with relatively few women coming through the ranks in front-line operational, commercial and general management roles in particular.

4 January 2013

References

Q&A: Gender Equality Duty—5 April 2007: http://news.bbc.co.uk/1/hi/business/6527275.stm

David Cameron axes equality assessments in war on “red tape”—PM announces end to equality impact assessments, a cut in judicial reviews and streamlined consultation. Hélène Mulholland, political reporter—guardian.co.uk, Monday 19 November 2012: http://www.guardian.co.uk/politics/2012/nov/19/cameron-axe-equality-assessments

Budget cuts could downgrade UK rights watchdog’s UN status—More cuts will see Equality and Human Rights Commission lose financial autonomy, and so its A-list rating, UN warns. Rajeev Syal and David Hencke—The Guardian, Friday 26 October 2012: http://www.guardian.co.uk/society/2012/oct/26/budget-cuts-rights-watchdog-un-status

Impact of Regional Pay on Women—Monday 1st October 2012. Women in public services will be worst hit by regional pay plan as women are 65% of all public sector workers: http://www.gmb.org.uk/newsroom/earlier_gmb_news/2012/oct_2012/impact_of_regional_pay_on_w.aspx

Coalition is “most female unfriendly” government—Barber. by Pete Murray—14th March 2012 http://union-news.co.uk/2012/03/coalition-is-most-female-unfriendly-government-barber/

Equality and human rights commission—PCS at the EHRC (2012): http://www.pcs.org.uk/en/public_sector_group/equality-and-human-rights-commission/index.cfm

Fawcett Society—Cutting Women Out: http://www.fawcettsociety.org.uk/index.asp?PageID=5

Women’s Budget Group—2012 WBG Responses: http://www.wbg.org.uk/RRB_Reports.htm

Changes on tax credits and retirement unfair to women, David Cameron warned

David Cameron has been accused of being “deeply unfair” to women after it emerged that the latest spending cuts will hit them twice as hard as men. By Rowena Mason, Political Correspondent: http://www.telegraph.co.uk/news/politics/8929797/Changes-on-tax-credits-and-retirement-unfair-to-women-David-Cameron-warned.html

International women’s day: the pay gap between men and women for your job—International women’s day focuses attention on the persisting gap in men and women’s pay. See how the figures stack up for each job—and explore the data (Simon Rogers, guardian.co.uk, Tuesday 8 March 2011) http://www.guardian.co.uk/news/datablog/2011/mar/08/international-womens-day-pay-gap

Equality: coalition is missing the point about women—Progress in the boardroom may prove to be the consolation prize for the loss of many gains women have won in the past 40 years. Editorial—The Observer, Sunday 12 February 2012: http://www.guardian.co.uk/commentisfree/2012/feb/12/observer-editorial-women-equality-benefits