Gender Pay Gap

Jess Phillips Excerpts

Wednesday 5th December 2018 Westminster Hall

[Stella Creasy]

Completely. One of the things that is so powerful about this data is that no sector—public, private or third—is immune from critique, because frankly none of them is valuing women in the way they could. That is reflected in how they pay them, how they promote them and how they work with them.

I am very struck by some of the brands that make a point of selling to women. After all, the one place where women have the majority of power in our society is in their purchasing power, as we account for 70% of purchases in this country. Yet those brands that make a virtue about selling to women are often the ones that, when we look at their pay gap, are some of the worst in this regard. I would not necessarily have put Sports Direct up there as champions of feminism, but its gap is 6%. Contrast that with Sweaty Betty, which has a 62% variation; with Monsoon, which has a 36% variation; or with Boux Avenue, which sells lingerie and has a 75% variation. Even when we are buying those companies’ products, they are not necessarily using the money to pay their women employees equally.

Many people have rightly challenged the data about the gender pay gap. After all, there were only four measures, so I agree that the data is a blunt tool. There are certainly things about the data that I would like to know more about. However, my argument today is that just because the data is not perfect does not mean it is not powerful. I absolutely agree that we need to understand much more than just gender when it comes to inequality in the workplace, the undervaluing of talent and what that means for our economy. It certainly means that we need to understand whether we can get better data on how black and ethnic minority employees are treated in the workplace. We know that the full-time pay gap for black African women is 19%, and that for Pakistani and Bangladeshi women it is 26%. That is in contrast to the general gender pay gap of 18%. Black male graduates earned a whopping £7,000 less per year than their white counterparts in the past 10 years. One of the things we know is that although black men have been more likely to invest in higher education than their white counterparts, they are less likely to have benefited from it in their pay packets. That is an interesting challenge for us.

This data also does not tell us about part-time work, which is absolutely crucial for women because, at 73%, the majority of part-time workers in our country are women. We know that there is a gender pay gap within the data for part-time work, but it is not as clearcut as the one within the data for full-time work, which is the data that we have for these individual companies. The data also does not tell us about age. For many people, understanding the difference of the gender pay gap, and therefore understanding what is driving it, is crucial when it comes to age. People presume that the gender pay gap is something that happens later in life. Actually, we are already seeing a gender pay gap building up with graduates, within 18 months of them entering the workforce. Again, that tells us that the gender pay gap is not necessarily what people think it is.

Also, in relation to the point made by my hon. Friend the Member for Midlothian (Danielle Rowley), the public sector cannot lecture the private sector in this regard. When we look at the NHS, we see that 77% of its employees are women but it still has a substantial gender pay gap. That should tell us—as the people in charge of public services—something about our ability to value women and their worth in the workplace. Indeed, the private sector pay gap has decreased, from 20% to 16%, while the public sector pay gap has widened to 13.9% in the past five years.

The data also does not tell us what difference getting qualifications makes. Again, when we go on to consider what might be causing the gender pay gap, people make presumptions about the impact of training and qualifications. Actually, when we look at the data, we see that it is not necessarily the case that women who have been educated to a higher level, such as degree level, are being paid more. Indeed, despite more women being educated to a higher level, there has been little or no change in the gender pay gap between groups of workers qualified to a degree level since the early 1990s. We also see a gender pay gap when it comes to apprenticeships. For level 2 and level 3 apprenticeships, women earned an average of £6.85 an hour, compared with the average for men, which was £7.10 an hour.

One of the things that is so powerful about this data is that, because it is so localised to particular companies, it helps people understand what is happening directly to them in a way that a general statistic does not. I have met the Minister to talk about one of the challenges in this regard: when the data was published in April this year, what impact did it actually have on the ground? I ask that because it is one thing for us here in this House to analyse the data and maybe call to account those firms that sell to women without paying women properly, but it is another thing to talk to our constituents about their experiences of what the data shows about their workplace.

Therefore, when the data was published, a cross-party group of MPs put together an anonymous survey called #PayMeToo to try to understand the experiences of women at the coalface. As the Minister knows, the responses were pretty shocking. People often say, “Data is a great disinfectant. Publish the numbers and that will drive change.” The data from the #PayMeToo survey shows that we might be publishing the data, but we are certainly not telling women to talk about it, and those women trying to talk about it in their workplaces face a hostile environment—I hesitate to use that phrase, but it is very clear from the responses we got.

Women were being told that that was just the way it is; that they work in sectors where there are not any women, so why would they expect women to be paid the same as men? They were being told by HR departments that they should bury the data; that they should not be difficult; that they needed to raise a grievance if they wanted to talk about those issues. They were being told that they could get a pay rise, but it would not be equal to that of their male colleagues, because it was about trying to manage the impact of the fuss that was being created. They were recognising that their companies were using what they called “very creative reporting” to try to minimise the gender pay gap, and so pretend that the issue was not happening. They were being told, “Don’t worry. Next year we will employ some more lower-paid men, and that will sort the problem.”

One of the things that I hope the Minister will commit to is following up that data and gathering it herself next year, when the second lot of data comes out. It should not be up to MPs to try to grab these qualitative pieces of research, when what consistently comes back to us speaks of the hostility that women face regarding the impact of this data; of just how sensitive it is for people to talk about what they earn in this country; and of the presumptions and cultures behind the gender pay gap, which we have to deal with.

Let us try to deal with some of those presumptions. At the moment, it is true that we have only half the story with the data, and many commentators both online and offline, including in The Spectator—I am sure Toby Young is watching—will try to fill in the rest of the blanks for us. They tell us that it is about women and their lifestyle choices—bluntly, that women have kids, therefore they want to work flexibly and to take time out, so of course they are going to be paid less.

[Jess Phillips (Birmingham, Yardley) (Lab)]

My husband has kids.

[Stella Creasy]

As my hon. Friend says, her husband has kids. She pre-empts what I am going to say: this is not about women, but about parenting. One of the challenges for us is to support both parents to be equally culpable for the child that they have created, including looking after that child, because that is one of the things that would help women in the workplace. There is an impact on women’s earnings when they become parents, but there is not as much of a gap for fathers. For mothers the pay gap is 30%; for fathers it is around 10%. We also recognise from figures provided by the Office for National Statistics that having children can only account for a third of the variation in gender pay. One of the things we have to nail in this debate, if we are to close the gender pay gap and get that economic benefit, is the idea that this is all about having kids. A big chunk of the variation cannot be explained by childcare or caring commitments.

The second thing people say is, “This is about women putting themselves forward. Women do not ask for pay rises; women do not seek promotion; women do not want to be in charge.” Thankfully, we also have research showing that is simply not the case—that, as much as we might admire her in many other ways, Sheryl Sandberg is wrong. This is not about leaning in; this is about systematic discrimination against women in the workplace. An Australian study. Clearly shows that men and women ask for pay rises, just as much as each other, but that men are four times more likely to get one. That is the same for men and women of similar attainment or qualifications, and for men and women of certain ages. Let us stop blaming women for the gender pay gap, because it is not their fault; it is the fault of the environment they are working in.

That environment is what we need to tackle, and that is not just about getting a few more well-paid women at the top—although, if we are honest, we have seen over the past eight years that that is not going brilliantly either. Britain’s public companies will need to appoint women to 40% of their board positions over the next two years if they are to meet the voluntary target that the Government have set, and 100 companies in the FTSE 350 have either no women or just one woman on their board. However, if I am honest, it is not women at the top who I am really concerned about, because the vast majority of the gender pay gap is about low pay and women. It is about the value that we attribute to certain sectors, and the fact that those sectors are dominated by women. The silent majority in this country that we need to speak up for is not the women who we are going to see on the back page of the Financial Times. This is not about getting a few more women in top positions, although some companies have worked out that that would skew their figures; this is about the millions of women working in jobs that are systematically undervalued and underpaid.

We see a lower pay gap within low-paid industries, but we still see a pay gap. Over one in five female workers are low paid, earning less than two thirds of a typical hourly wage or just £8.55 an hour, compared with just 14% of men. That silent majority needs us to recognise that challenging the gender pay gap, and getting the better productivity and the economic benefits of doing so, comes about through how we think about those industries. It comes about through how we think about progression and flexible working within them, and not taking no for an answer; not thinking that this is somehow just about women being more confident or more articulate, or even a bit of anti-bias training, welcome though it would be.

--- Later in debate ---

[Helen Whately (Faversham and Mid Kent) (Con)]

Thank you, Sir David. I congratulate the hon. Member for Walthamstow (Stella Creasy) on securing this debate and on her speech, which she delivered with characteristic passion and peppered with huge quantities of data. I start by reflecting that the gender pay gap is at an historic low of 8.9%. We should acknowledge that, but also that it persists—we do not want it to persist; we want it to close and to end up without a gender pay gap—and that practically, most women’s incomes are still hit by having children.

When I was a new mum, I was lucky; I had a supportive employer that allowed me to work flexibly. It was working hard to encourage women to stay at work, having children, and to move up the organisation. I benefited from that, but I recognise that a huge number of women do not have that. In fact, only 11% of jobs that pay more than £20,000 are advertised with flexible working as an option, while the demand is estimated to be closer to 90%. That means that many women are not able to continue working in the job they were working in, and have to make choices that are not the ones they want to make. We know that by the time a couple’s first child is aged 20, mothers are earning on average nearly a third less than fathers.

[Jess Phillips]

Does the hon. Lady agree that one way we could stop some of these problems with the gap between men and women would be to pay men more to stay off work? If we gave men 90% of their pay for the first six weeks of their baby’s life, as we do with women, it might encourage a different atmosphere. Does she agree?

[Helen Whately]

I will say a bit more about maternity and paternity pay later, but we absolutely must ensure that it is equally possible for men to take time off work when they become new dads, and that there is a more equal sharing of childcare responsibilities between mums and dads. One reason why that is not happening is that there are financial barriers to doing so.

I acknowledge the work that the Government are doing to tackle the gender pay gap. For instance, last year it was made mandatory for companies with 250 or more employees to report their gender pay gap. There was some speculation at the time as to the difference that would make, and that companies would not bother to comply. I imagine the Minister will confirm this, but my understanding is that there was 100% compliance and that companies did report it, even if it often did not reflect very well on them. That reporting is making a difference. I checked on what my previous employer was doing, because its reporting did not make it look that great. It did a whole report about the actions it was going to try to take to close the gender pay gap on the back of that reporting. If companies across the country are all doing that, that will make a difference. Now that we have had large companies do that, I am keen to see smaller companies do the same.

The headline point is that it makes good economic sense to close the gender pay gap. It makes sense for companies. We know that companies with greater gender equality do better. They perform better for their shareholders, it is good for their reputation and it helps them attract better candidates. When companies are struggling to recruit for the skills they want, clearly they need to ensure that they attract good women as well as good men. Greater gender equality also makes economic sense for the whole country. If we fail to make the most of the capabilities of women, we are failing to make the most of half the country’s workforce.

It is not just about women, however. Making things better for women has knock-on benefits for men, too. I know lots of dads who wish they had been able to spend more time with their children in the early years. Shared parental leave was introduced by the Conservative-led Government in 2014 to enable dads to do exactly that, but as Members have alluded to, there are barriers to men’s taking up paternity leave. There is more to be done to ensure much more equal taking up of maternity and paternity leave, to help dads play that greater role in their children’s early years and mums to keep their careers going.

I welcome the fact that the Government are looking at placing the onus on companies to assess whether a job could be done flexibly, and to make that clear when advertising it, rather than just relying on people—particularly women, but men too—coming forward asking for their job to be flexible. Anecdotally, I have heard that it is men who come across particular barriers when asking for a job to be flexible. We need to address that, too. I would also like to see greater transparency from large companies in publishing their parental leave and pay policies, so that they are absolutely clear to potential job candidates. There is a whole question around maternity discrimination, which we know is illegal, but is still pervasive. Too many women are forced out of work, whether that is having to take maternity leave early because they are pregnant, being made redundant while on maternity leave, or one way or another finding that they are unable to return to the workplace after having children.

Just to sum up, bearing in mind the time, I urge the Government to keep on pushing to close the gender pay gap. I urge them to keep pushing employers, business, the public sector and Parliament itself to do better.