By Hannah Ford, March 2018
Ahead of the deadline for gender pay gap transparency on April 4, by which time all companies with over 250 employees must have reported their figures, Hannah Ford, a lawyer at Stevens & Bolton, specialising in equality and diversity issues, shares her top tips and explains your rights around navigating pay gap negotiations…
Timing is everything
When is it sensible to ask for pay re-negotiation?
Some moments are, naturally, better than others. The reality is that an employee’s negotiating strength will peak and trough throughout the year and fortune can favour the opportunistic. Most employment contracts have an annual pay review date (to tally with accounting year end, or the anniversary of commencement of employment).
But this should not be viewed as the only window in which to ‘talk turkey’. If an employee feels they are being underpaid they should find a time where they can have a candid discussion, without distractions on the issue. Even if the employer’s hands are ‘tied’ at that juncture, it may serve as a place marker to revert to during the pay review window.
Getting the facts
Do you have a right to demand pay transparency? Can you ask to know what your peers are being paid? If this information is denied to you, what other sources could you use (e.g. job ads, insights from recruitment consultants)? If on the other hand this information is shared with you, what are your legal obligations in terms of discussing or even re-confirming this information with colleagues? What facts and evidence of your performance should you bring along to any negotiations?
There can be a multiplicity of reasons why employees performing similar roles are paid differently e.g. market forces at the point of recruitment, individual experience or skill set, historical issues such as a business merger, or simply individual bargaining strength or skill.
Employers are not legally obliged to bow to a spurious demand from an employee to disclose what a colleague is paid. However, an employee who suspects that a pay disparity is linked to a ‘protected characteristic’ – such as their sex, age or race – can submit written questions to their employer or use their employers’ grievance procedure to probe further. A failure to deal with the issue ‘head on’ and with transparency can lead to an inference that discriminatory factors are at play. If proven these could expose the business to a costly claim in the employment tribunal.
Employees who believe that they are receiving unequal pay because of their sex, for performing work of equal value, can use the Equal Pay Act to seek redress. Employers will only have a defence if they can prove that the difference in pay is due to a ‘genuine material factor’ which is non-discriminatory.
Many employers require employees to maintain confidentiality around their remuneration package by using contractual pay secrecy clauses. Such provisions can usefully deter employees from being distracted by salary discussions or engaging in ‘bonus bravado’, however they can be difficult to enforce where breached. Such provisions are void in circumstances where an employee suspects a disparity in pay exists on grounds of their sex.
In companies with increasingly fluid career paths and flexible work patterns, how can you determine whether two slightly differing roles are comparable in scope and therefore should be identical in pay? How might a move to part-time work impact on the discussion over fairness?
This is heavily dependent on individual circumstances. The starting point will be core terms and conditions of employment, working hours, job description/responsibilities, job function in reality, day to day duties, reporting lines and so on. Employees who work reduced hours should obviously anticipate that their salary will reflect hours worked, however an employee should not be penalised for working remotely when their output is identical to a peer.
Call the cavalry?
At what stage is it sensible to get legal advice?
A balance needs to be struck between seeming heavy-handed/overly aggressive and ensuring your rights aren’t being overlooked. Employees who threaten legal action, obviously risk alienating their employer. This is rarely advisable where their objective is to preserve the employment relationship, but on better terms.
The position is different where the relationship has broken down because an employee suspects they are being paid less unlawfully e.g. on grounds of their sex. In these circumstances it is sensible to seek professional advice at an early stage and develop a strategy for raising the issue, for instance a potent grievance email.
An eye on the future
People often worry that making a fuss over pay could mean that they might later be side-lined for prime pieces of work, overlooked for promotion or even dismissed as a result. What legal redress is there for employees who believe they have been mistreated in this way? What kind of evidence would they need to support a claim of this kind of backlash?
Where an employee raises an allegation of discrimination, and is subjected to a detriment as a result they are protected from acts of victimisation. Depending on the circumstances and number of co-workers affected, there may also be a route of redress via the whistleblowing legislation. To place themselves in the strongest position they would have a record of the initial pay complaint of conversation, such as an email or contemporaneous attendance note of what was said, although this would not a bar to seeking redress.
If the answer is no
What further steps can be taken? Can line managers be ‘leapfrogged’ by appealing direct to more senior management? What are the risks associated with doing so?
Where an employee has a good understanding of the employer’s organisational politics, they may seek out a ‘champion’ elsewhere in the business to take on the issue. The risk of this approach is that in doing so they undermine their direct management, which can be even more damaging long term.
Where there is a suspicion that the decision is discriminatory, employees can utilise their employer’s grievance procedure to formalise matters, although this is or threaten to vote with their feet. Extreme measures such as ultimatums can be irremediably damaging to the employment relationship.
Hannah spoke on the panel of our ‘Know Your Worth’ event in partnership with The Telegraph on March 19 2018 at The Bloomsbury hotel in London.
Original article for Telegraph Women, published 19th March 2018: https://www.telegraph.co.uk/women/business/can-ask-equal-pay-work-advice-lawyer/