Pay gap: will new legislation let off the worst offenders?

Research shows that the gap is often more pronounced in smaller companies


New government measures to tackle the gender pay gap will only apply to firms who employ more than 250 people. These companies will be required to publish the details of their employees’ salaries.

But according to a leading salary benchmarking website, the government could have got its prioirities wrong. Statistics from show that the pay gap may actually be more pronounced in smaller companies. Data submitted anonymously by over 61,000 people show that:

  • For retail managers, the gap for large companies stands at 11 per cent, while for companies with less than 250 employees it can be as much as 26 per cent.
  • At VP level in investment banking, men receive bonuses 50 per cent bigger than their female counterparts in smaller companies, but double the size in organisations with over 250 employees
  • In consultancy, there appears to be no gender gap for senior consultants in large organisations but there is a 20 per cent difference for companies with less than 250 employees
  • The same is true for Legal Associates, with an equal salary in large firms but a 15% difference in firms with less than 250 employees.

This is the first time that the government has made it an obligation for companies to disclose the salaries they pay. A previous scheme made it voluntary for firms to present the information but only five chose to do this: Tesco, Friends Life, PwC, AstraZeneca and Genesis.

It will be interesting to see whether a climate of greater transparency encourages smaller firms to come forward – or whether they will take advantage of being out of the spotlight.

Ruby Stockham is a staff writer at Left Foot Forward. Follow her on Twitter

Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.