Headlines have recently highlighted issues around the gender pay gap – women earn 22% less than men in full-time roles. These have focussed upon why the gap still remains when the first equal pay legislation came into effect over 40 years ago. Next year, David Cameron will introduce rules to force companies with over 250 workers to disclose their pay gap, despite fierce resistance from employers. But what about SMEs?
We know most SMEs will not have structured salary scales and within a recruitment market where there is competition for good candidates, and in some roles skills gaps, they are often forced to pay over the market rate to secure the ideal candidate. As a result, although SMEs may be motivated to implement equal pay, unintentional anomalies can occur. It is not always as black and white as it first appears – market forces do play a large part and employers may not always be aware of the anomalies they can create even outside of the equal pay argument.
However, where possible and practicable, SMEs do need to be very mindful of inequalities in all areas of remuneration and benefits. SMEs should make sure they have clear but appropriate pay structures, and ideally have completed some form of job evaluation processes, to ensure that they can defend any equal pay claims, should they come their way.