[Metrobeans]

B430 - Fair Pay Bill 2012, JPKC, TSR Labour, TSR Liberal Democrat, TSR Socialst

Fair Pay through Litigation Act 2012

An Act to further prevent the unfair application of prejudicial biases in the determination of employee remuneration.

BE IT ENACTED by The Queen's most Excellent Majesty, by and with the advice and consent of the Commons in this present Parliament assembled, in accordance with the provisions of the Parliament Acts 1911 and 1949, and by the authority of the same, as follows:-

Part I: Practical and Legal Facilitation

1 Disclosure
(1) For the purpose of this Act:
(a) "Remuneration" includes any salary received (including overtime pay), though excludes both work expenses and performance-related bonuses.
(2) An employee may request in writing that their employer disclose the per hour remuneration paid to one (or more) fellow employee(s) in the same job if they are in wage employment, or that their employer disclose the per year remuneration paid to one (or more) fellow employee(s) in the same job if they are in salaried employment.
(a) Their employer must comply within 28 days following reception of such a request.
(3) The employee is advised to keep this information confidential if that is the preferred policy of their employing organisation; their employer may penalise them for not doing so.
(4) Equally, the employers are expected to keep the fact of the investigation and the identity of the employee seeking the information confidential. Failure to prevent workplace bullying gives the employee in question grounds to prosecute under the Protection from Harassment Act 1997.

2 Litigation
(1) An employee may prosecute their employer if it is suspected that a wage difference between themselves and one (or more) fellow employee(s) is the result of any of the following:
(a) The gender, race, ethnicity, sexual orientation or presence of any disability, of themselves or their colleague(s) in the same job.
(2) If an employment tribunal rules that any of the above factored into the amount of remuneration received, it may order that an employer adjust the amount it pays to the plaintiff(s).
(a) The new remunerative sum should reflect the removal of any prejudicial factors cited in (1)(a).
(b) Provided that none of the (1)(a) factors directly affect the ability of the individual to perform the role for which they are employed.
(3) The tribunal may access information regarding the employing organisation's payroll so as to inform all judgements made.
(4) In the event that the tribunal judge rules in favour of the plaintiff, the employer must pay a monetary sum in compensation. This figure should incorporate:
(a) The total amount of pay missed in the previous one year due to the presence of factors in (1)(a).
(b)The total cost of the plaintiff's legal fees, and any pay lost due to the employment tribunal.
(c) The equivalent of one month's pay or 160 hour's pay for salaried or waged workers respectively, unless (4)(a) exceeds this figure.
(5) In each adjudication where a case of discriminatory inequalities in pay is found, the tribunal will review the payroll of the organization with the aim to find any other such incidences.
(a) If said incidences are found, the employee(s) facing the potential discrimination shall be notified of the legal options they have by the Tribunals Service.

3 Statute of Limitations
(1) The person making the claim must have received the discriminatory pay within the last 365 days.
(2) The person making the claim must remain employed in the same job as the one in which they received the discriminatory pay.
(a) Unless they were illegally dismissed from it, as determined by a separate employment tribunal.

Part II: Miscellaneous
4 Short Title
(1) This Act may be cited as the Fair Pay Act 2012.

5 Commencement
(1) This Act comes into law 2 years following Royal Assent.

Notes

The purpose of the Fair Pay Bill 2012 is to firmly encourage workplaces where only work matters when it comes to deciding the amount people are paid. This builds on the preceding Equal Pay Act 1970, Sex Discrimination Act 1975, Race Relations Act 1976, and the Equality Act 2010 - each of which go part of the way to achieving this objective. However, there is a large body of evidence suggesting that more is needed, and sooner, particularly when it comes to the amount women are paid. (Articles here, here and here provide a glimpse of the current problem.) This Bill is no attempt to change the current situation with intrusive top-down directives, it is instead a way of incentivising businesses to iron out improper discrimination or face the litigatory wrath of employees that want pay to be about work, merit and nothing else.

Section 1 (Disclosure) of the legislation is about transparency within organisations; it allows employees to take the initiative with fixing the problem, enabling them to hold unfair employers to account in an employment tribunal (with the provisions in Section 2). Clause (2)(a) ensures that if a company wishes, they can try to keep any sensitive pay information within the company, though obviously greater risk of this not happening is a by-product of this Bill. The element of disclosure is very important to the successful implentation of equal pay legislation:

Ruth Bader Ginsburg:
A worker knows immediately if she is denied a promotion or transfer, if she is fired or refused employment. And promotions, transfers, hirings, and firings are generally public events, known to co-workers. When an employer makes a decision of such open and definitive character, an employee can immediately seek out an explanation and evaluate it for pretext. Compensation disparities, in contrast, are often hidden from sight.

Section 2 (Litigation) is the meat of the Bill: it enables people to pursue fair pay for themselves if they don't believe that they are currently getting it. 4(a)(b)(c) is a reasonable reward for employers that challenge unfair pay, while also being a suitable penalty for those companies that fail to change in line with the times - a two year grace period allows companies all the time in the world to sort things out and apply balance to their payrolls for employees doing the same work. This Bill strengthens and clarifies rules that already exist primitively.

[Metrobeans]

(Original post by JPKC)


*The Lib Dems are, I think, co-sponsoring as well.

Just added that second.

[toronto353]

I'm abstaining. I like the idea of transparency, but it's going to lead to arguments about pay which will lead to a less happy and therefore less productive workforce.

[Smack]

Um, why is it anyone else's business what someone earns?

[Mr Dangermouse]

Aye.

[JPKC]

(Original post by toronto353)
I'm abstaining. I like the idea of transparency, but it's going to lead to arguments about pay which will lead to a less happy and therefore less productive workforce.

I don't know why people would squabble over pay if they were getting it fairly, which is the ultimate point of this Bill - it doesn't apply to performance-related bonuses, which could cause tension (even though lots of companies already publicise them to spark competition!).

[Morgsie]

Aye, Statistics show that women earn 30% less than men.

[internetguru]

No.

[JPKC]

(Original post by Smack)
Um, why is it anyone else's business what someone earns?

The current secretive system allows for discrimination to be hidden, which is why we still have ridiculous pay gaps between men and women - employers in the wrong cannot be held to account by their employees. Also, is there anything inherently damaging about making pay marginally more public?

[cl_steele]

Whilst i like to the idea of transparency within the company i think its infringing a bit to much on someones right to privacy within the work place, it should be their sole prerogative who knows their pay slip so that being said a no from me.

[RoryS]

Aye - a well written and backed up bill.

[Smack]

(Original post by JPKC)
The current secretive system allows for discrimination to be hidden, which is why we still have ridiculous pay gaps between men and women - employers in the wrong cannot be held to account by their employees. Also, is there anything inherently damaging about making pay marginally more public?

Source that we still have pay gaps between men and women, and again, why is it anyone else's business what someone earns?

[JPKC]

(Original post by cl_steele)
Whilst i like to the idea of transparency within the company i think its infringing a bit to much on someones right to privacy within the work place, it should be their sole prerogative who knows their pay slip so that being said a no from me.

Well it's not their sole prerogative at the moment - all colleagues above them in the employment hierarchy will be aware, as will human resources departments. Also, the taxman, the bank, etc. Not to mention that there's nothing actually bad about pay being more open - it won't create tension if everyone's being paid fairly, remember, this does not include performance related bonuses.

[Rakas21]

I like the spirit of the bill but unfortunately it is not one which the Conservative Party can support.

[JPKC]

(Original post by Smack)
Source that we still have pay gaps between men and women, and again, why is it anyone else's business what someone earns?

I've provided links in the Notes. I could find more if you really actually aren't aware of this already.

Payment for work is fundamentally a social contract between more than two people so already it's not private. What you're asking is why should it be less private, my answer is that hiding pay is the main facilitator for employers to incorporate irrational discrimination in their payroll. If you have some argument for keeping salary/wage secret then please I'm all ears.

[cl_steele]

(Original post by JPKC)
Well it's not their sole prerogative at the moment - all colleagues above them in the employment hierarchy will be aware, as will human resources departments. Also, the taxman, the bank, etc. Not to mention that there's nothing actually bad about pay being more open - it won't create tension if everyone's being paid fairly, remember, this does not include performance related bonuses.

sorry i should have been far more clear i meant besides the people who have to know, a need to know basis as it were and bob from down the corridor, for instance, has no need to know does he?
i mean im all for fair pay and all but i am personally of the opinion that a harmonisation of pay packets for roles within companies would be more of the way to go such as all people employed doing role 'y' will be payed 'x' amount. disregarding performance, seniority, age etc. etc.

[Smack]

(Original post by JPKC)
I've provided links in the Notes. I could find more if you really actually aren't aware of this already.

Has anyone actually done proper research into this area, taking into account differences in hours worked, qualifications, experience and performance? I haven't seen any - all that I've seen is that women earn X% less than men. Which is an utterly useless statement to make...

Payment for work is fundamentally a social contract between more than two people so already it's not private. What you're asking is why should it be less private, my answer is that hiding pay is the main facilitator for employers to incorporate irrational discrimination in their payroll. If you have some argument for keeping salary/wage secret then please I'm all ears.

Sorry, but who the hell else is involved apart from the employer and employee in an employment contract?

[DebatingGreg]

Aye. Good cross party/indie collaboration too

[JPKC]

(Original post by cl_steele)
sorry i should have been far more clear i meant besides the people who have to know, a need to know basis as it were and bob from down the corridor, for instance, has no need to know does he?
i mean im all for fair pay and all but i am personally of the opinion that a harmonisation of pay packets for roles within companies would be more of the way to go such as all people employed doing role 'y' will be payed 'x' amount. disregarding performance, seniority, age etc. etc.

Well you said yourself that you can see the merit of fair pay, having a reasonable level of pay disclosure makes fair pay achievable in companies where at the moment all pay is hidden without due reason. This Bill will serve as an incentive for companies to harmonise pay between men/women in the same roles, though it doesn't at all affect payment based on performance and experience - these are both factors that I believe an employer should be able to take into account.

[LPK]

Aye.