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Equal Pay: Private Sector

Volume 490: debated on Monday 30 March 2009

To ask the Minister for Women and Equality what plans she has to reduce the gender pay gap in the private sector. (265717)

A key to reducing the gender pay gap is pay transparency. The forthcoming Equality Bill will ensure that employers will not be able to rely on keeping their pay structure secret. We will ban secrecy clauses in employment contracts, so that women can identify unequal pay and seek redress.

The Bill will also enable employers, where women are under-represented in the workforce, to recruit a woman if she is an equally suitable candidate to a man, so that they can increase diversity in their workforce.

The Government are also committed to using the spending power of the public sector to deliver greater transparency on important equality issues like gender pay. £175 billion is spent by the public sector on private sector contracts every year. We are therefore looking at ways to use the purchasing power of public bodies to help achieve equality outcomes in the private sector. The Office of Government Commerce has published practical guidance for public procurers on what they can do to promote equality through the way they buy goods and services.

Through the Bill we will provide for an employment tribunal to be able to make a recommendation, where an employer has been found to have unlawfully discriminated, on how that employer can improve its practices in a way that applies not just to the successful complainant but to everyone in that workplace. This will help prevent similar types of discrimination happening again, so reducing the likelihood of future claims.

In the light of the Civil Justice Council's report and the specific research commissioned by the Government Equalities Office, we are considering whether there is a case for introducing representative actions for discrimination and equal pay cases. This will feed into wider work being taken forward by the Ministry of Justice looking at the case for representative actions across all jurisdictions of law. We will consult on any proposals for reform.

The Equality and Human Rights Commission is also conducting a formal inquiry into the financial services sector, as it has evidence suggesting that a high proportion of women working in some areas of financial services are paid less than their male counterparts, and suffer harassment at work. The financial services industry has the largest pay gap between men and women in the private sector at over 40 per cent. with far fewer women in senior roles than in other sectors.