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Equal pay legislation could mean bigger pay outs for businesses


"OK - Before I see my solicitor explain to me why am I not worth
the same pay as everyone else"

Changes to the Equal Pay Act from 19 July 2003 mean that businesses could be paying out even more in compensation claims.

This should raise alarm bells for businesses as a survey by Croner, the UK's leading provider of business information, advice and support, reveals that 70% of businesses have not carried out an equal pay review, meaning they are unsure if they have a gender pay gap. This leaves them wide open to allegations of unequal pay.

Businesses who currently breach the equal pay act are liable for compensation of up to two year's back pay. The new legislation removes this provision, meaning businesses could be paying out a lot more.

There could also be an increase in the number of unequal pay claims as the six-month period after employment has ended during which a claim must be brought has been extended in some circumstances.

In the UK, women's earnings are currently 19% lower than men's. An Equal Pay Questionnaire allows individuals who suspect they are not receiving equal pay to request details of their co-workers' salary, which calls for organisations to clarify and strengthen their pay structure and review
procedures, or face paying the price at tribunal.

Richard Smith, HR expert at Croner said: "Unequal pay is something which can easily go undetected if not monitored. A regular equal pay review will highlight where a pay gap may be emerging, and whether it is gender-related.

Croner recommends that all businesses carry out equal pay reviews to identify pay gaps so they can be addressed or justified on other grounds to minimise the risk - and cost - of unequal pay allegations."

Croner provides information, advice and support to employers to ensure they are complying with current legislation regarding equal pay. Croner advises employers to:

Treat men and women equally in their terms and conditions of employment when they are employed in like work, equivalent work and work of equal
value.

Demonstrate a material difference between the positions that is not gender-related.

Treat part-time employees no less favourably than their full-time equivalents, unless this can be justified on objective grounds.
Respond promptly and comprehensively to an equal pay questionnaire from an
employee.

The Equal Pay Act 1970 gave women the legal right to be paid the same as men. But traditional factors of discrimination in pay, occupational segregation and unequal impact on women's family responsibilities are still contributing to today's gender pay gap.

"Employers have a responsibility to keep salary details confidential, which is why gender pay gaps have largely gone undetected over the years," said Richard. "Employers are now paying a high price, however, so it's in their best interest to seek advice and ensure equal treatment in the workplace."

The poll was carried out for one week on Croner's
www.humanresources-centre.net  website. The question was: "Has your organisation carried out an equal pay review?" The full response was: Yes 15%, No 70%, Unsure 15%. The site has over 7,200 registered users.