Equal pay audit compromise is aimed at pushing through equality bill
Tim Medcalf, equal pay specialist at NorthgateArinso Reward Solutions, discusses the issue of raising the threshold for pay reporting from companies with 250 or more employees to those with 500 or more.
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Reducing the number of companies affected by equal pay audits is justified to drive the equality bill through Parliament, a pay expert has said.
Tim Medcalf, equal pay specialist at NorthgateArinso, told PM that raising the threshold for pay reporting from companies with 250 or more employees to those with 500 or more was a compromise. But, he said it was worthwhile in the short-term to ensure the bill was passed.
He also said that once pay reporting had been tested with the initial rules there was no reason why the threshold couldn’t be lowered to include more companies.
Medcalf, who also sits on the technical advisory group for gender pay gap reporting for the private sector at the Equality and Human Rights Commission, said: “There’s a lot of politics involved in this decision and they [ministers] are trying to sweeten the bill through Parliament. As far as stakeholders I’ve spoken to feel, as long as we start the ball rolling then some progress will be made.
“I’m in favour of getting organisations thinking about the issue and I see no reason why every organisations couldn’t do [pay reports]. ”
He said that getting the bill through with some form of pay reporting would allow a “road test” of the system.
“It is a new area. We’ve always known about the issues but whether reporting on pay resolves them, we’re not too sure yet. We need to look at the easiest and most beneficial ways of reporting. So we need to get the bill through and then see what we can do to improve it.”
He admitted that excluding so many businesses from pay reporting was “not what everyone would like”.
But he said: “If pay reporting starts to make an impact on the pay gap then there’s no reason why we couldn’t lower the threshold.”
But law firm Pinsent Masons said that pay audits were masking another major sticking point for employers in the equality bill: the positive discrimination tie-breaker.
In a survey of 1,000 HR professionals conducted by the firm, only 30 per cent agreed that the tie-breaker using positive discrimination would achieve its aim, while more than half (54 per cent) disagreed.
Selwyn Blyth, employment partner at Pinsent Masons, said: "These results show that there is even less of an appetite for the tie-breaker as a way of addressing workplace inequalities than twelve months ago. Clients tell us that it runs against the principle of meritocracy that underpins their recruitment processes. They also say that because of the way the clause is drafted, they would fear a discrimination claim from the applicant who was not chosen.”
These comments came as the bill was getting its second reading debated in the House of Lords (15 December).