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Why Employers Shouldn't Worry About Equal Pay Litigation

04/11/2015 15:45 GMT | Updated 04/11/2016 09:12 GMT

There's a new report out from Eversheds to the effect that employers are terrified that new requirements for gender pay gap reporting will lead to litigation. And, ipso facto, come and get some great legal advice to ease your fears...

Should employers be worried? Bluntly - no.

Here's why:

Firstly, it's worth a bit of background. The penny has finally dropped for even the most misogynistic men (and women with a nod to Germaine Greer) that equality is a good thing. Get the most talented people to the top, irrespective of gender, and we will all be a bit happier and a bit richer.

The government has a small but vital role to play to help us on that journey. And when the mood takes, it can produce the occasional carrot - or, wave a small stick. The small stick is definitely in evidence with the proposals around gender pay gap reporting.

Of course people doing the same job, should be paid the same. And, of course it's manifestly unfair if men's general ability to shout a bit louder means they get paid more. We all hear about the gender pay gap and how women effectively work for free for 2 months every year. Politely, most of the headlines around the gender pay gap are a load of baloney. The reasons for the gap are myriad and complicated but fall primarily under four headings:

1. Different Jobs:

Men and women tend to do different jobs - for example, we're desperate for more male staff in our nursery business but they're very difficult to find

2. Career Breaks and Time Off:

Because women tend to take more time off when they become parents than men. All things being equal, if you have a year out - you will be a year behind a colleague who didn't.

3. Career Choices:

Men and women often make different, less career-oriented choices when they become parents - and while the culture is shifting, it's still more often women than men who make the drastic changes.

4. Volume:

Men seem to shout louder. A gender pay gap is only an issue if it's caused by reason number 4 or bits of number 3.

Working out which of the underlying reasons is the real cause of an organisation's gender pay gap is very, very difficult. Just look at where Deloitte (one of the UK's most sophisticated and best employers) has got to with its own gender pay gap reporting.

So here's the point, regulatory gender pay gap reporting is a good thing. It will force already hard-pressed HR departments into some uncomfortable places and will result in some fascinating internal findings by thousands of employers. But to begin with, the legislation will be full of gaps and alternative interpretations. It will take a good few years, I'm guessing five at least, for UK PLC to really understand what is required and for some accepted benchmarks to become the norm. It won't be until the loopholes are closed and the standards understood that the litigation threat might start rearing its ugly head.