Equality Bill will hit business, warn CIPD and EEF

Leading HR and business groups have condemned the government’s introduction of gender pay audits as a “bullet aimed at employers”.

As part of the Equality Bill, published Monday, private sector employers with more than 250 staff will be forced to report their gender pay gap from 2013, if they fail to heed ongoing calls to do so voluntarily.

Public sector organisations will also have to provide audits of their pay if they employ more than 150 workers.

Figures released by the Office of National Statistics currently put the full-time gender pay gap at 17.1%

Charles Cotton, reward adviser at the Chartered Institute of Personnel and Development, said gender pay reporting was not the answer to the pay gap.

He said: “It is dishonest of policy makers to imply that [the pay gap] can be solved by some magic bullet aimed at employers. Voluntary pay reporting, with the big stick of compulsory reporting looming in 2013, will do little more than create bureaucracy and fuel employment law claims.”

David Yeandle, head of employment policy at manufacturing body EEF, added: “The culture change needed in our society to encourage a more diverse workforce and address equality issues will not be achieved by imposing unnecessary administrative burdens on business such as the requirement to publish gender pay data.

“This will do nothing to reduce the gender pay gap and could undermine manufacturers’ efforts to encourage more women to work in manufacturing.”

Campaigning charity Business in the Community expressed concern that without clear explanation, government provisions in the Bill to encourage ‘positive action’ over the employment of under-represented groups risks confusing employers and both alienating and undermining the achievements of those it is trying to help.

Sam Mercer, director of workplace at Business in the Community, said: “Over-simplifying the issues and cementing ideas which sound great in theory, but don’t translate into practice may well cause more problems than they solve.”

He added that a more open approach to reform, where employers are seen as part of the solution, not the problem, was needed.

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The CIPD, however, welcomed the clause to ban employers from imposing secrecy over pay.