Business groups slam gender pay audit proposals

9 Aug

Government moves to introduce pay audits to help stamp out gender pay inequality have been criticised by employers groups as flawed and potentially damaging to business.

The Consultation on Modern Workplaces outlined a number of proposals to make changes to employment law – including extending the right to request flexible working to all employees, and a new flexible system of parental leave where new mothers and fathers can share leave – which employers groups say would push up wage bills and hamper the economic recovery. But it’s the proposal on pay audits that has raised the biggest concerns.

The British Chambers of Commerce, the EEF, the Institute of Directors and the Federation of Small Businesses have written a letter stressing their opposition to the enforcement of gender pay audits. Under the government’s proposals, if a company is found guilty at employment tribunal of gender pay discrimination – as well as paying compensation – it will have to carry out a pay audit to identify if the case was a one off, or it if is endemic within the business.

The business groups argue that pay audits are a waste of time, money and resources. Tim Thomas, head of employment affairs at EEF, said: “Employers will draw a line in the sand on plans for gender pay audits. They will do little to increase pay transparency in the private sector and are likely to have the opposite effect.”

David Frost, director general of the British Chambers of Commerce, added: “If an organisation loses a gender pay case, under these proposals not only will they pay compensation to the claimant, and a possible fine to the Treasury, but they will also be forced to undergo a pay audit. The tribunal system is already chaotic, and this proposal will add further complexity and could encourage more weak and vexatious claims against employers.”

If statutory measures aren’t the answer, I wonder what is – especially when the gender pay gap between men and women working full time is still 15.5%.

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One Response to “Business groups slam gender pay audit proposals”

  1. Proposals 05/09/2011 at 7:06 am #

    This is great move from the government, hope every one would love this, thanks for the timely update!!@bose

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