Monthly Archives: March 2015

Gender, pay and the lip-service gap

The government will finally introduce regulations for mandatory reporting of the gender pay gap within organisations of more than 250 employees, in the next twelve months or so.

This is a change of tune, the government previously having taken the view that voluntary reporting under the “Think, Act, Report” scheme would do the trick. Around 275 employers signed up to “Think, Act, Report” but to date, the Guardian reports that only 5 employers have reported on their gender pay gap under the voluntary regime. Clearly there’s another significant gap somewhere between lip-service and action. So why has voluntary reporting failed?

When I did public sector equal pay litigation, I always used to think it unfair that it was those organisations who had accepted the equal pay issue onto their agenda and who had actually done work on standardising their pay systems who could be most easily picked off by no-win no-fee lawyers looking for easy wins; whereas those employers whose systems were completely opaque were overlooked by those same lawyers as presumably just too difficult. Staying below the radar was therefore a logical choice for an employer.

I think this is why voluntary reporting hasn’t worked. Why would a company who cared about remedying the pay gap, put itself “out there” for criticism for not being perfect, when its even less perfect competitors could just stand back and let them take the PR hit? Compulsory reporting levels the playing field and makes it worth an organisation’s while to care.

It might be optimistic but I hope that over time, armed with this information, women will vote with their feet to the companies and organisations where their prospects are best, giving employers a clear economic incentive to implement good, creative and positive practice to eliminate the pay gap, because it makes sense to get and keep the best people. And not just “professional” women, but all women, across all sectors.

And of course, men benefit from equal pay too. The Women and Work Commission has estimated that closing the gender pay gap has significant macro-economic benefits; and the children of low paid mothers (boys and girls) are bound to feel a particular benefit from measures which bring about equal pay.

Of course some other stuff has to change too. When I was reading around for this blog, one of the articles I read on the gender pay gap reporting requirements in a quality newspaper was accompanied by a (no doubt targeted) ad for washing powder. One step at a time then…

Alison Humphry
Partner, Workwise Legal

Keep Calm and Be Reasonable

Last week’s EAT case of Donelien v Liberata UK Ltd provided further guidance on what it is to be reasonable, this time in the context of constructive knowledge of an employee’s disability, giving rise to the duty to make reasonable adjustments.

Even if an employer does not have actual knowledge of their employee’s disability, the duty to make reasonable adjustments applies if they could reasonably have been expected to know of the disability and the fact that the employee may be placed at a substantial disadvantage as a result. This prevents an employer from escaping the duty simply by sticking their head in the sand and failing to make enquiry into the underlying reason for an employee’s high number of short-term sickness absences.

The EAT stressed that employers do not have to strive for perfection in their efforts to identify whether an employee has a disability, but instead have to carry out a reasonable enquiry in those situations. In Donelien the employer had obtained an occupational health report, conducted return to work meetings and spoken to the employee and her G.P. That was considered to be reasonable.

On the face of it, the case is reassuring – and familiar – news for employers. After all, the concept of reasonableness is never far away from the Employment Tribunal. It stands loud and proud at the forefront of unfair dismissal claims as the ‘range of reasonable responses’ test and in the requirement to have undertaken a reasonable investigation into allegations of misconduct. It appears in disability discrimination claims based on a failure to make reasonable adjustments and last year the duty to deal reasonably with a request for flexible working replaced the detailed procedural regulations.

The problem is that reasonableness is a shifting concept. What is reasonable in one set of circumstances might not be reasonable in another. For example, the EAT has already made clear that it would not be reasonable for an employer to simply adopt the conclusions of an occupational health report as to disability, without additional enquiry or consideration. On the other hand, an employer who strives too hard to find out about the potential disability of a job applicant may risk falling foul of the ban on pre-employment questions contained in the Equality Act.

Similarly, the EAT recently made clear that an employer’s duty to carry out a reasonable investigation into allegations of misconduct did not require investigation of each and every line of defence. However, it remains the case that a failure to do quite enough investigating exposes an employer to potential unfair dismissal claims.

Although easier to achieve than perfection, reasonableness still takes some thinking about. An employer who recognises the duty to act reasonably and is able to evidence its intention and efforts to act reasonably by reference to clear, contemporaneous paperwork, will go a long way to achieving it. Even if they fall short, that process will serve them well in minimising the risk of challenge by their employees or minimising the financial penalty of a successful Tribunal claim. Being reasonable is not rocket science, but it is also no time for complacency.

Claire Collinge