Equal Pay Guide for Small Businesses Published

As the Equality Act comes into force this October, the British Chambers of Commerce (BCC) and the Equality and Human Rights Commission (EHRC) are urging SMEs to look at their pay systems to ensure they comply with equal pay laws.

The process of checking a small business’s pay system is relatively simple for a small organisation and should take no longer than four hours to complete, according to the new guidance published this week.

It has been forty years since the Equal Pay Act (1970), yet women who work full time are still paid 16.4% less per hour than men (on average). In the public sector the pay gap is 14.6% whereas in the private sector the divide is much greater at 21.6%.

The EHRC guidance aims to be a used by employers to create fair and transparent pay systems that will be "a good start" in closing the pay gap.

David Frost, Director General, of the British Chambers of Commerce, said:

“Businesses want to pay people fairly for the job that they do. This guidance should help smaller businesses analyse any pay gap and make any changes required by law.

Taking action now to make pay systems transparent and fair should help businesses recruit the best talent to enable the private sector to drive economic recovery.”

Dr Jean Irvine, Commissioner at the Equality and Human Rights Commission, added:

“Employers need pay systems that are both transparent and fair. While transparency is not enough in itself to reduce the pay gap between men and women, it does provide clarity; it is difficult, if not impossible, to resolve a problem that cannot be seen.

What we ask of small and medium size employers is not difficult; it takes minimal time and effort but can offer a real return. Linking equal work to equal pay will see employees rewarded fairly for the work they do. Employees will enjoy the benefits of working for a company which actively promotes equality while employers will protect themselves from a potentially costly and time consuming equal pay claim.”

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