Coronavirus Pauses U.K. Gender Pay Gap Reporting Ahead of April Deadline

(Bloomberg) -- The annual April scramble among U.K. companies to report their gender pay gap to the government is off this year, another casualty of the coronavirus just as its economic fallout makes labor market equality especially vital.

Authorities dropped the requirement last week due to the “unprecedented uncertainty and pressure” faced by companies struggling to cope with lockdown measures. More than 4,000 firms published their results ahead of the usual April 5 cut off date, but that still accounts for less than half the figure that has historically reported. It’s difficult to draw any conclusions from the data because organizations with less to hide may file earlier. 

Advocates fear the suspension could become permanent, just as economic fallout from Covid-19 hits women hard. “I’m really worried we’re going to step backwards,” said Vicky Pryce, former joint head of the U.K. Government Economic Service and author of “Women vs Capitalism.” “Pay gap reporting highlighted a problem that needs to be addressed, but I suspect it’s all going to be forgotten for a while. Companies are just going to try to survive.”

Before a global pandemic put millions out of work, women in the U.K. made 17.3% less than men, according to the Office for National Statistics. The current economic crisis is highlighting inequities that pay equality advocates have long sought to expose, particularly that women tend to hold the least secure and lowest-paying positions. While women's participation in the U.K. labor market was at a record-high 73% at the beginning of 2020, they hold three-quarters of part-time jobs.

Social distancing directives and city-wide lockdowns are hitting roles often held by women especially hard. They account for around seven in 10 sales assistants, cashiers and airline cabin crew. Even women who work in white-collar jobs that allow employees to work from home may face greater pressure to reduce their hours to care for children, at a time when many schools have closed indefinitely.

Women also dominate essential, but low-paid professions such as nursing and social care. A study by think tank Autonomy found that out of the U.K.’s three million workers at high risk of the virus, 77% were women. For the at-risk employees whose pay put them below the poverty line, that proportion jumped to 98%. 

Before the pandemic, employers with more than 250 workers were due to submit mean and median hourly salary and bonus figures for men and women. In previous years, the Equality and Human Rights Commission had the power to investigate and fine employers that failed to report their data. 

Some are arguing the blunt approach should be suspended permanently. The Institute of Economic Affairs think tank describes those requirements as “crude,” due to their failure to compare pay on a like-for-like basis, and said they create “perverse incentives” for companies to avoid hiring women into junior roles in male-dominated industries.

The fallout for women right now, however, will be starker than ever, Pryce argues. “Women will be poorer in absolute terms, but they will also sink faster because they started poorer to begin with,” she said. “We have to really seriously watch the data on this.”

©2020 Bloomberg L.P.