Nearly 80 percent of organisations reporting gender pay gaps are in favour of men, according to a new report by the Business, Energy and Industrial Strategy (BEIS) Committee.
A new report from the committee on gender pay gap reporting notes that while the median pay across the economy is 18 percent in favour of men, at an organisational level, new research found gender pay gaps of over 40 percent are not uncommon in some sectors and 78 percent of organisations are reporting gender pay gaps in favour of men.
The committee notes that only around half the members of the UK workforce are expected to be covered by the present reporting requirements and therefore, there should be a widening of the net of companies required to report.
Recognising evidence that the pay gap is higher in smaller businesses, the report calls on the government to widen the net of organisations required to publish gender pay gap data to those with over 50 employees - from the current 250.
The report recommends that organisations should be required to publish, alongside the figures, an explanation of any gender pay gap and an action plan for closing the gap, against which they must report progress each year, as part of normal reporting requirements.
Rachel Reeves MP, chair of the BEIS Committee, said: "A persistent gender pay gap shows that companies are failing to harness fully the talents of half the population. The penalties of working part-time, both financial and in terms of career progression, are a major cause.
“Companies need to take a lead. For example, why aren’t they offering flexible working at senior levels? They must look at why they have a pay gap, and then determine the right initiatives, policies and practices to close it. Chief executives should have stretching targets in their key performance indicators and be held to account for any failure to deliver.”
The committee’s report calls for clarification of the way in which the remuneration of equity partners is included in the gender pay figures, before next year’s figures are published.
The report also notes that the exclusion of the highest paid people in organisations made “a nonsense of efforts to understand the scale of, and reasons behind”, the gender pay gap and that the government was wrong to omit the remuneration of partners from the figures required in the regulations.
The committee recommends that the government uses the guidance to clarify how data on partner pay should be calculated and included in time for the publication of data next year.