The government’s flagship Equality Bill, set to be formally laid before Parliament in next week’s Queen’s Speech, has provoked a great deal of controversy since it was first unveiled in June.
The Equality Bill will allow employers to positively discriminate in favour of women and minorities, give wider powers to employment tribunals, ban ‘gagging clauses’ on pay, and require some organisations to publish diversity and gender pay statistics.
Now, an exclusive survey of 1,080 HR professionals by Personnel Today and law firm Pinsent Masons reveals what the HR community really thinks about the Bill. Our research shows that, while more junior staff are broadly supportive of government efforts to increase equality in the workplace, there seems to be some apathy towards the new laws among senior practitioners.
All HR directors polled state that the amount of time they have spent dealing with employment legislation – and by extension money and effort – has increased. The majority also feel it will take yet more time to introduce the new regulations into their business – yet only half say the legislation will benefit equality.
So the apathy emerges as a result of the gap between the administrative burdens that employers see being placed upon them, and the outcomes achieved as a result of introducing the legislation.
Coupled with the expectation that the regulations will swell the number of tribunal claims from employees, therefore resulting in more expense in the future, it’s no wonder that the HR community is concerned about the impact of the Bill.
Eight in 10 respondents said the time spent dealing with employment law issues over the past two years had increased. The most significant reason for this increase was the administration time linked to introducing new laws (66%), with more than one-third saying the increase was due to more claims being brought by employees.
One in 10 HR professionals believe they will need ‘a significant amount of time’ to introduce the new regulations into their business, with a further 50% saying it will take ‘a fair amount of time’. Public sector respondents were twice as likely as their private sector counterparts to need a significant amount of time (15% compared to 8%) – reflecting the increased duties the Bill will impose on that sector.
Selwyn Blyth, senior associate in the employment law team at Pinsent Masons, says the results indicate that HR professionals are suffering from “legislation fatigue”.
“HR directors have faced a great deal of equality legislation introduced by the government in recent years. The Equality Bill seems to be being viewed as yet another thing for senior HR staff to deal with it’s almost as if we’ve reached legislation fatigue,” he says.
In the video clip (left), Chris Mordue, a partner at Pinsent Masons, comments on the survey and on why a significant number of HR directors appear to be struggling to buy into the proposed new legislation
The Bill proposes giving employment tribunals wider powers to order employers to change pay practices or conduct equal pay audits. HR professionals are not keen on this measure 40% feel they will be costly to business, and one in five believe it will ‘open a can of worms’ – potentially leading to big problems or more claims for employers to deal with.
Overall, private sector employers were far less enthusiastic about this measure than the public sector, perhaps an indication that they have more to hide in terms of their pay practices.
On the controversial positive action measure – where employers can choose a job candidate from an under-represented group ahead of one from an over-represented group if they are equally qualified – almost two-thirds of the senior HR practitioners sampled believe this will lead to an increase in the number of discrimination claims from candidates unsuccessful in the recruitment process.
The government has been quite ambiguous as to how positive action will work in principle, yet this is one of the most hotly debated areas of the new law. Four in 10 actually disagree that the change will lead to better workforce diversity, with private sector respondents more pessimistic. Both large and small employers think that putting the regulations into practice will lead to increased recruitment costs and management time.
With the law potentially coming into force on the back of a deep recession, this could prove disadvantageous to employers wanting to get back up to full capacity quickly once it ends.
“At the moment there is very little information on what is needed to comply with the Equality Bill in practice,” says Blyth. “A good example of this would be the ‘tie-break’ scenario in recruitment. Guidelines on what employers will have to do to be able to positively discriminate in a tie-break situation are vital – this will be the first time this has been allowed under UK law.
“Until we get this guidance, it’s likely that the HR profession will continue to view the legislation with some scepticism, so it is imperative that this is produced sooner rather than later,” he warns.
One of the key objectives of the Bill is to make discrimination legislation easier to understand, thereby improving equality. However, only half of those surveyed believe the Bill will be very, or fairly effective in achieving this. Strikingly, just 4% of respondents thought the new law would be very effective in achieving this aim, while more than a third reckon the Bill will have little or no effect.
The legislation proposes to ban gagging clauses so that workers can compare wages and challenge employers who unlawfully pay them less. The survey found, overall, that about one in six organisations have these secrecy clauses in place for certain job roles, with private sector employers three times more likely to have them.
The plan to scrap these clauses and become more transparent on men and women’s pay was voted the area likely to have the biggest impact overall on employers. Two-thirds of HR professionals believe that lifting the lid on staff pay will result in a greater number of equal pay claims made by employees.
Despite this, only half of respondents in the private sector indicated they had an equal pay policy in place. Equal pay claims are far more common in the public sector than private, the research confirmed.
This issue is likely to be thrust into the spotlight again after official statistics released earlier this month showed that the gender pay gap between men and women in full-time employment increased slightly in 2008 to 17.1%, up from 17% in 2007.
Selwyn warns that, overall, the survey shows that without better communication from the government to employers there could a lack of buy-in to the law, resulting in problems when it comes into force – as early as next year.
“In general, equality law is very procedurally driven, but that procedure doesn’t always result in effective outcomes,” he says. “There is a danger that this Bill ends up the same – many of the businesses we advise are less worried about the procedure required what they want to know is how to work within the law, and minimise the risk of getting into trouble.”