The long-awaited Equality Bill has been published today, setting new laws to help narrow the gap between gender pay and strengthen anti-discrimination legislation.
The Bill, expected to come into force by autumn 2010, is set to replace nine laws and more than 100 other measures with one single Act to make it easier for employers and staff to understand their legal rights and obligations.
Harriet Harman, minister for women and equality, said: “Today we publish our tough new Equality Bill, promised in our manifesto, building on our actions over the past 10 years. It will make Britain a more equal place, and help us build a stronger economy and fairer society for the future.”
The Bill will require all employers with more than 250 staff to report their gender pay gap from 2013, if sufficient progress on reporting has not already been made voluntarily.
The Equality and Human Rights Commission will develop a set of metrics for gender pay reports in consultation with business, unions and others over the summer, and the commission will then monitor the progress of reporting within the private sector annually.
Public bodies with more than 150 employees will also be required to report on gender pay as well as other equality data including the number of black, Asian and minority ethnic workers.
Further measures to bring equality to pay include banning employers’ ability to use employment contracts to prevent staff talking about their wages. Currently, nearly one-quarter of employers stop their staff from discussing their salaries, and the government hopes lifting this will allow more women to challenge unlawful pay.
Harman said: “We will shine the spotlight in every workplace on the hidden pay discrimination against women.”
Vera Baird, solicitor general, added: “Employers will no longer be able to rely on keeping their pay structures secret. We will ban secrecy clauses in employment contracts, so that women can challenge unfair pay. And we will encourage businesses to report on gender pay, but let us make no mistake: if voluntary measures do not work, we will take stronger measures to ensure equal pay for women.”
Figures from the Office of National Statistics show the full-time gender pay gap currently stands at 17.1%.
Last week, business groups expressed concern that the introduction of equal pay audits would hit businesses as they struggle to emerge from the recession.
The Bill will also enable employers to favour under-represented groups during recruitment processes – provided the candidates are of equal suitability – to increase the diversity of their workforces.
Harman said the Bill also aims to tackle social-economic inequality by putting a new duty on all public bodies to consider what action they can take to reduce socio-economic inequality when making strategic decisions about spending and services.
“We know that inequality is grounded not just in gender, race, disability, age and sexual orientation, but also by class. So we will require public bodies when they make strategic decisions to help narrow the gap between rich and poor,” said Harman.
Employment tribunals will also be given wider powers to make recommendations to firms on how to improve work practices. Currently, tribunals can only offer recommendations to the individual who brings the case, and they often end up leaving the company.
Under the Equality Bill, tribunals will be able to deliver recommendations directly to firms to ensure similar types of discrimination are not repeated.
James Purnell, secretary of state for work and pensions, said: “The government wants to make sure each person gets the help and support they need to overcome their barriers to work, fulfil their potential, and build a better life for themselves and their families.”