Ifty Nassir, founder and CEO of Vestd, discusses the implications of the new Employment Rights Bill for pay equality. She also explains how employers can create equal pay across their company.
Mixed reactions have been received by the new Employment Rights Bill that was announced in the King’s Speech. Some believe that it is a step towards equality and protection of employees while others worry about the impact it may have on businesses.
The new legislation will make parental leave and sick pay as well as protection against unfair dismissal, a right that all employees can enjoy from day one, improving equality and the business culture of the UK.
The ban on zero-hour contracts and the introduction of flexible work from the first day are policies which could cause financial and technical problems for employers, even though they may have a positive impact on the gender wage gap.
We’re waiting for more details about the new laws and how they will be implemented. However, this has raised questions regarding equality and equity at work.
The gender pay gap in particular is an example.
Although it was not explicitly stated in the King’s Speech, the hope is that the new measures can help close the current gap of 14.3 percent. The data shows that the gap has decreased by 25% over the past decade. However, the newly formed Labour Government is pushing for it to be closed even faster.
The causes of the gender pay gap can’t be fixed overnight. They are complex. Women are seven times as likely to miss work due to caring responsibilities than men, according to data. Working mothers are twice as likely to request flexible work arrangements. This can reduce their availability for meetings and travel, or make them less visible in the workplace.
Women are also less likely than men to apply for promotion, perhaps because they struggle to balance their extra responsibilities with their family life.
In the background notes to the King’s Speech, the Government’s solution for tackling inequality promotes flexibility and protects all workers. It also ensures that the rules are adhered to.
Flexible working has become the norm
HR teams should seriously consider requests from employees for flexible working, whether it is working at home, compressed working hours, or flexitime. They can review current policies, gather feedback from teams and implement a standard policy on flexible working for all employees.
A study shows that around 250,000 women quit their jobs because of childcare pressures. New laws may encourage men to request flexible work due to childcare responsibilities. We could see that it is easier for women now to take on greater responsibility and achieve their earning potential.
Increased scrutiny
Employers will face more severe consequences if employees complain about unfair treatment or pay inequalities.
The Fair Work Agency will be formed in order to better enforce workplace rights. Employers can now be fined directly by the agency or prosecuted. It is up to the HR team to ensure that there are no unfair pay discrepancies, to promote transparency and to conduct regular pay reviews.
What can employers do to promote equality?
Employers have an increased responsibility for improving equality in the workplace with the new legislation. The key to closing the pay gap between men and women is to offer more flexibility and choices to employees, regardless of their background or role.
This means being open to hybrid working, flexible starting and ending times, and even a four-day work week, if it is practical and feasible. Reviewing your flexible working policies will not only put you in a good position before the changes are implemented, but you also have time to gather feedback from your team and create a policy that works well for everyone.
Businesses should also strive to implement policies that promote equity in the workplace. Skills and experience will determine the salary of each employee. Employee share schemes give everyone the chance to be recognized for their contribution, and encourage them to innovate.
All employees can benefit from perks like share schemes, which provide a safety net and extra income. Women can find them particularly useful. YouGov found that women are less likely than men to request a raise in pay, with 60% never asking. Employees who are given a stake in the business experience a ‘ownership’ effect, which improves retention and motivates them to reach their goals.
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Ifty Nair founded and is CEO of Vestd.
