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May 02, 2008

The tutti-frutti approach to pay

The news that the outgoing Italian administration had released the salary details of its citizens online, in a bid to cut tax evasion, sent me off into a daydream yesterday. If it happened here, would I rush to discover what my neighbour earned? Probably not. How about my editor - or a male colleague who I think should earn less than me, but actually earns more? And once armed with this fact, what could I usefully do next? Knowing precisely what someone else earns doesn't tell you anything about the reasoning behind the figure. Though it would be helpful to have some nice woman (probably) in HR reveal how the boxes are ticked and all the sums worked out. Until then, employers will continue to have an unfair advantage over us all.

Of course in this fantasy world, employees would have to be prepared to show off their pay packets - or at least be outed via pay grade. Sixty per cent of UK workers would not mind revealing what they earn in order to achieve parity, a survey by Hudson, a recruitment consultancy, has found. Tellingly 62 per cent of those surveyed said that managers should have to disclose what they are paid. It could be worked into a team-building exercise, perhaps? And what would bankers do come bonus time? Though given the banks' current state of self-inflicted woe, perhaps such disclosure is a necessary thing. 

There are so many questions because if fair pay is a thorny issue - equal pay is even more so. Just before the Equal Opportunities Commission (EOC) shut up shop in October last year, its chairwoman Jenny Watson said it was time for new legislation to close the gender pay gap. The Equality and Human Rights Commission, which succeeded the EOC, quickly failed to meet its target to implement its own internal equality scheme on Jan 1. Weeks later, its chair Trevor Phillips said that the number of disgruntled women bringing cases before employment tribunals threatened to bring the system to a standstill. In 2006 - 2007, more than 44,000 equal pay claims were lodged - an 155 per cent increase on the previous year. I wonder if Phillips earns more today than Watson? 

The causes of the gender pay gap are complex. The Government's Women and Equality Unit lists: differences in educational levels and work experience; the substantial pay gap between men and women's part-time hourly earnings; women's reluctance to commute for long distances; the number of women working in female-dominated, low-paid professions; and the number of women concentrated at low-pay grades. And that's not all. You could also point the finger of blame towards job-grading practices, appraisal systems, reward and retention measures, wage-setting practices and plain, old-fashioned discrimination, it says. And all in all, I'm beginning to wish I hadn't started this post.

So, it's back to the Italian way. I say publish and let the fun and games begin.   

Posted by Clare Dight on May 2, 2008 in Finance | Permalink | Comments (0) | TrackBack (0) | Email this post

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