Firms must reveal bonuses in pay-gap details

David Cameron
David Cameron
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FIRMS WILL be forced to include bonus payments when they publish details of the pay gap between men and women employees, the Government has announced.

The requirement will also be extended to the public sector as part of a fresh push to bring women’s earnings in line with those of men, who on average earn around 19.1% more.

Prime Minister David Cameron, who has described the differential as “a standing rebuke to our country” and said he wants to end it in a generation, said the lack of income equality was denying women opportunities.

Downing Street said it was the first of a number of equality-boosting measures to be set out in the coming days.

More than 10 million workers across the country will be covered by transparency rules affecting outfits with more than 250 employees - legislated for by Labour in 2010 but blocked from implementation by the Conservatives until this year.

Details of exactly what must be published and when the scheme will begin are yet to be announced after a consultation, which followed complaints the data could be misleading.

Downing Street said they would be published “in due course”.

Mr Cameron used his high-profile speech to the Conservative conference to highlight how his own daughters could face gender discrimination over pay, telling delegates: “You can’t have true opportunity without real equality.”

But he has come under pressure from the recently-formed Women’s Equality Party (WEP) to translate commitments into concrete action to close a gap of £245 billion a year between the totals earned by each of the sexes.

Different pay for doing the same or similar work has been outlawed for 40 years and the significant gap in average salaries reflects the lack of women in senior positions and the types of jobs they tend to go into.

WEP leader Sophie Walker said unaffordable child care and employment inflexibility that meant only part-time work suited those looking after children and elderly parents “adds up not just to a gap in earnings but a gap in power”.

Minister for Women and Equalities Nicky Morgan said the Government also wanted to see women on all boards of FTSE 350 companies - after a target of getting women into at least a quarter of boardroom seats in FTSE100 firms was met.

Lord Davies - who set that target as part of a government-commissioned review - is due to outline final recommendations.

Ms Morgan said: “From the opportunities women are given in school to the ability to move up the executive pipeline, we are determined to tackle the barriers to women achieving their all.

“Business has made huge amounts of progress already in recent years - the gender pay gap is the lowest since records began.

“But it should appal us all that, 100 years on from the Suffragette movement, we still don’t have gender equality in every aspect of our society.

“That’s why I’m delighted that we are going further than ever before to ensure true gender equality in the workplace.”

Chartered Management Institute chief executive Ann Francke said: “One of the biggest drivers of gender pay discrepancy, especially at senior levels, is the bonus gap.

“Bonuses are also where gender bias can creep in easily as they are amongst the least transparent forms of pay.

“There’s a tendency to reward those in our own image or to think that because men may be the ‘main breadwinners’ they deserve higher bonuses. And men often negotiate harder or trumpet their achievements more readily.

“The Government’s new reporting legislation is a welcome step forward and will be good news for business. Clearer employee data, improved recruitment and a reinvigorated focus on business culture will help unblock the talent pipeline and support more women to become senior managers and leaders.”