Pay Related Gender Inequalities Between Men and Women - Essay Example

? Employment Law By Due Employment law’s primary function is to mediate the relationship among employees, employers, trade unions and the Government. It is essential for the socio-economic development of any country. In a capitalist society, the employers try to take every possible measure to keep labour costs low. Labour law provides protection to labours from exploitation. In this process, there is a myriad of issues to be dealt with. One of the key issues is that of gender inequality. Management of gender diversity has a great importance in modern workplaces. Since the Industrial Revolution, women have suffered a lot due to gender bias and have not been able to receive their rightful share. Their suffering has come both in terms of discriminatory behaviour and through unjust pay scales. It was only a matter of time for this issue of inequality to be given attention at higher levels i.e. the Government.1 Forces were set in motion in the early 2000s when pay audits were rendered obligatory for the public sector employers while they remained voluntary for the private sector employers.2 The involvement of public sector has been somewhat fortuitous as there have been many developments in equal pay litigations. The UK Parliament passed a law called Equal Pay Act 1970 according to which men and women were not to be treated in a less favourable manner in terms of pay and work conditions. This Act was merged in the Equality Act 2010. Despite the enactment of a law and other obligations, there continue to be some significant gender pay gaps. In 2010, the Office for National Statistics recorded that the difference between the median hourly pay of full-time males and females was 10.2 percent while the gap for all employees was 19.8 per cent. An even wider gap was observed in the private sector where it was 19.8 percent for the median hourly pay of full-time males and females and 27.5 percent for all employees3. It is unfair to hold the employers responsible for this gap entirely. There are also certain other factors that contribute to the generation of this gap. There are particular social structures in which there is an automatic occupational segregation, the work of women is undervalued and the family responsibilities are divided unequally. Yet, these factors are only a partial explanation of this gap. There continues to be a significant amount of discriminatory behaviour by the employers which is why the law is continuing to evolve through case law. While focussing on equal pay, it is to be kept in mind that ‘equal pay’ does not address any grievances that arise among the members of similar sex. It addresses all the terms and conditions of the contract of employment. It is not just that men and women, who hold similar positions in a workplace, must be paid equally; it further delves deeper to ensure that men and women are paid equally for the similar amount of work. Equality Act 2010 was brought in force in 2010 and it replaced Sex Discrimination Act 1975, Race Relations Act 1976, Disability Discrimination Act 1995, Employment Equality (Religion or Belief) Regulations 2003, Employment Equality (Sexual Orientation) Regulations 2003 and the Employment Equality (Age) Regulations 20064. This law has been achieved by following a series of steps. There have been a number of cases of direct discrimination that lead to the formulation of principles regarding discrimination. In order to determine whether a woman’s terms of employment are not less favourable than a man’s, the courts consider three requirements: i. Like Work This concept has a very wide view. It is defined as ‘work of the same or a broadly similar nature’. This concept is there so that the courts and Employment Tribunals take good care to determine that the work done by men and women has an overall similarity for which they are being paid equally. If any of them is doing less work than the other, they are not being paid equally. The major focus is on what actually happens in the job and not on what the contract says. This means that equality refers more to the element of fairness rather than mathematical equality5. In Capper Pass Ltd v JB Lawton6, Mrs. Lawton was employed as a chef who worked 40 hours per week. She worked with two highly paid male assistant chefs who worked for 45.5 hours per week and prepared 350 meals a day. Mrs. Lawton, on the other hand, prepared 10-20 lunches for Directors and Managers of the Company. She brought an equal pay claim against her company and she compared her job with that of the two male chefs. It was held that both type of works were broadly of a similar nature and should be regarded as like work. The differences were regarded as trivial as the two jobs were similar in the broader sense i.e. preparing meals. This case reflects that while dealing with the comparators, it must be made sure whether the differences in work are of a practical importance. Some significant practical differences were found in Maidment and Hardacre v Cooper & Co (Birmingham) Ltd7. In this case, Maidment, a packer, asked for equal pay comparing her job with a male packer. It was found that the male packer also performed additional duties as a storeman. Therefore, it was held that the claim was devoid of sufficient grounds to be granted. ii. Work Rated as Equivalent When two jobs are rated as equivalent, it is obligatory for the employers to pay both jobs equally. However, there a lot of things to consider while determining whether a claim is valid. In Pickstone v Freeman’s plc8, in her claim of equal pay, Mrs. Pickstone, a Warehouse Operative at Freeman’s plc, compared her job with a male Checker Warehouse Operative. In the same company, there were also males who worked as Warehouse Operatives. Also, there were females who worked as Checker Warehouse Operatives. Therefore, the company argued that Mrs. Pickstone could not have brought an equal value claim comparing with a man who worked as Checker Warehouse Operative. The House of Lords clarified that the applicant is free to choose her comparator. It was held that Mrs. Pickstone had a right to compare her job with any man employed on like work or work rated as equivalent. Equality Act does not make any such restrictions. iii. Work of Equal Value Equality Act also entitles workers to claim equal pay when they are in the same employment and are doing work of equal value. Work is regarded as equal when it is ‘assessed as equal in value in terms of demands such as effort, skill and decision-making’9. It happens very often that jobs being compared are of a different nature but are of equal worth. The worth of work is determined through the demand that is made for an employee. It is extremely important not to ignore the fact that jobs of entirely different types can be of equal values. In Bromley v H&J Quick10, the question arose whether conducting a job evaluation study which does not evaluate each job in terms of the demand made on a worker under various headings is a valid study under the equal pay legislation. It was held that in order to satisfy the requirements of the law, the job evaluation study must be analytical. This means that it must evaluate the jobs in terms of demand made on the employees under various headings such as effort, skill and decision-making. Also, it should be made certain that the evaluation has been made between the jobs in question; evaluation of benchmark jobs and slotting the job of the Applicant and her comparator into ranking by reference to those benchmarks is never enough. When there are claims of equal pay, the employers usually recourse to the defence known as Genuine Material Factor (henceforth GMF)11. While employing this defence, an employer tries to prove that even though the applicant and her comparator are doing equal work, the difference in pay is not due to sex bias but due to a material factor that cannot be disregarded. Numerous reasons have been given by employers as GMF over the years. However, there is no reason that can be regarded as having a universal nature so that it can be used in each case as a safe bet. Each case is decided individually and it depends on the particular facts of a case whether a reason provided by the employer is GMF or not. In Ratcliffe and Others v North Yorkshire County Council12, market forces were not regarded as a material factor because they were not justified on objective grounds. The female caterers were paid less by the employers so that they could lower their total costs and be more competitive in the market. Another potential defence available to employers is related to job evaluation. The legislation requires two conditions to be fulfilled if this defence is to be successful. Firstly, the job evaluation scheme has to be analytical which means that it has to be based on a valid factor. Secondly, it has to be non-discriminatory both in design and in implementation. The jobs of both the applicant and the comparator must be analysed and evaluated under the same scheme and the scheme must still be valid. The case of Bromley v H&J Quick, as discussed above, lays out the conditions in which the job evaluation scheme can act as a bar to an equal pay case. It can be seen that sufficient efforts have been made to reform the legislation. However, it can also be noticed that there is a lot of room for improvement. For instance, S 83(2) of Equality Act 2010 defines “employment” as: a. “employment under a contract of employment, a contract of apprenticeship or a contract personally to do work; b. Crown employment; c. employment as a relevant member of the House of Commons staff; d. employment as a relevant member of the House of Lords staff.”13 This definition is not broad enough. This definition allows many loopholes and may exclude some women who are actually employed. For instance, women working as housemaids without availing the services of any agency might not fall in this definition. It might be argued that freelance housemaids usually do not face issues in which they are paid less than the men because few men are a part of this industry. But there are also many other employment related rights which might not be available to freelance women. The scope of this definition needs to be widened so that the problem of the loophole at this very basic level can be fixed. S 77 of Equality Act 2010 nullifies the enforceability of any clause that prevents an employee from disclosing information about the terms of his work14. This section is probably the most misconstrued one in the whole act. This might be due to the fact that in 2008, the Labour Government vowed to ban all secrecy clauses and prevent people from discussing their pay15. Interestingly, this section does not ban or prevent anything. It only renders secrecy clauses unenforceable in so far as the disclosure is a “relevant pay disclosure” within the meaning of the section. This means that if employees divulge the information about their salaries to their colleagues who might later become their comparators, the employer cannot choose to take any disciplinary action against them. If he does so, the employees would be entitled to claim victimisation in an employment tribunal. S 77 leaves an unresolved issue; there are no means of proving that an employee has imparted or received information that is covered by this section. In the absence of any clarification in the law, the courts find it very difficult to answer this question. Another problem is in S 78 which requires employers to “publish information relating to the pay of employees for the purpose of showing whether, by reference to factors of such description as is prescribed, there are differences in the pay of male and female employees.”16 This section only includes large employers and does not require anything in this regard from the smaller employers17. This means that a great number of the employee community has to suffer because they do not have the knowledge that they are being paid less. From the Government’s point of view, it is very difficult to oversee and analyze all the employers, large and small. However, the Government also has shown little enthusiasm to include all employers. The Government can employ more people if the burden of analyzing data is too much for the existing staff. In the cases that have been discussed above, it can be seen that women have faced gender bias in pay repeatedly. The employers have devised new ways to justify the discrimination in salaries. It is a good measure by the courts that they decide each case individually and take good care to determine whether there is a genuine material factor for the difference in pay. There is also a need to increase awareness about women’s rights. A partial reason why there is this discrimination is the overall psychology of the community that women cannot be better than men. It is probably why whenever there is a need to cut costs or downsize, the women are sacrificed first. They are first to be paid lower or laid off. In a capitalistic society, everyone has to compete for their share in the economy. Women have had to compete in this society too, but they have had to face even tougher competition because of their being women. This means that there might also be a need to educate people in a different way so that there are fewer hurdles for women to get their share from the economy in the future. However, all the suggested reforms must be made in a very calculated manner so that equality claims do not become unfair for the employers. Employers reserve the right to reward their employees in any way as they deem fit. They just need to be careful that there is no discrimination when they do that, and no employee is unfairly left behind. Equality legislation is designed solely to bring equality. Therefore, it must be made sure that this legislation does not lean too much in favour of the applicants. References Bromley v H&J Quick Ltd [1988] IRLR 249 CA (http://www.accesstolaw.com/uk/case-law/) Capper Pass Ltd v JB Lawton [1976] IRLR 366 EAT (http://www.accesstolaw.com/uk/case-law/) Equality Act 2010 (UK) S 77 (http://www.legislation.gov.uk/ukpga/2010/15/contents) Equality Act 2010 (UK) S 78 (http://www.legislation.gov.uk/ukpga/2010/15/contents) Equality Act 2010 (UK) S 83(2) (http://www.legislation.gov.uk/ukpga/2010/15/contents) Maidment and Hardacre v Cooper & Co (Birmingham) Ltd [1978] IRLR 462 EAT N.A, 'Equality Human Rights' (Equality Human Rights, n.d) accessed 27 November 2013 N.A, ‘Equal Pay for “like work’’ (Equality Human Rights, n.d) N.A, ‘Work of equal value’ (Equality Human Rights, n.d) accessed 29 November 2013 ONS (2010) ‘Full-time gender pay gap narrows’. (Available at http://www.statistics.gov.uk/cci/nugget.asp?id=167, accessed 23 June 2011). Pickstone v Freemans plc [1988] IRLR 357 HL (http://www.accesstolaw.com/uk/case-law/) Ratcliffe v North Yorkshire County Council [1995] IRLR 439 HL (http://www.accesstolaw.com/uk/case-law/) S. Fredman ‘Reforming Equal Pay Laws’ [2008] 37 Industrial Law Journal 193 Simon Deakin ‘Gender Inequality and Reflexive Law: The Potential of different Regulatory Mechanisms for making Employment Rights Effective’ (2011) Centre for Business Research, University of Cambridge, Working Paper No. 426. Read More