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Proposed Reduction of the Gender Pay Gap at European Level

The gender pay gap, which is the average difference in gross hourly earnings between women and men across the economy as a whole, currently remains at the high rate of 18 %. The UK pay gap at 21.4% is higher than the European average and equates to an under-utilisation of women’s skills in excess of £11bn a year. The European initiative may therefore have a significant impact for UK employers.

Together with the European partners, the European Commission will analyse the economic and social implications of the different options it considers: enhancing transparency on pay by providing better information to workers, encouraging the use of gender neutral job classifications and pay scales and making sanctions on breaches more dissuasive. Non-legislative as well as legislative methods could be used.

The European Commission will also support communication on the gender pay gap through statistics, the developments of new tools and the promotion of initiatives at the workplace. An example is the French label “Egalité professionnelle” which is already awarded in France to businesses for three years, providing they show their commitment to gender equality through areas such as scheduling, career development and internal promotion. Awareness-raising activities are essential to inform employers, employees and stakeholders why there is still a gender pay gap and how it can be reduced.

Some of these measures are already raised in the forthcoming Equality Bill, for example transparency and reporting. In particular the Bill reduces the scope of pay secrecy clauses ensuring there is more transparency and less opportunity for discrimination in pay. The Bill also contains a power for the Government to issue regulations requiring employers with 250 or more employees to publish information relating to gender pay, although it is not clear when or whether this power will be invoked.

The new EU strategy for gender equality for 2010-2015 will be published in the second half of 2010, coinciding with the coming into force of most provisions of the Equality Bill.

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