Women and Low Pay

Jim Cunningham Excerpts

Wednesday 18th November 2015 Westminster Hall

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

I beg to move,

That this House has considered women and low pay.

The work that women do is crucial to the functioning of society, but their pay does not reflect that. Despite the fact that their qualifications are as good as, or better than, men’s, their skills are not rewarded to the same level as men’s, and their career progression is slower. We need to ensure equal pay for work of equal value.

This subject is vital for millions of women, and for their families and employers. Living on low pay means that women do not have enough money to give their children nutritious food, let them go on a school journey or take them on holiday. It means not being able to escape a violent relationship, losing much of their pay on the cost of fares to and from work, and not being able to save enough to cover even minor crises, such as the washing machine or car breaking down.

Forty-five years after Parliament passed the Equal Pay Act 1970, we are still to achieve equal pay. Forty-five years later, a 19% gender pay gap still exists. That is 3% higher than the EU average, despite the figure having reduced by a third under the last Labour Government.

When talking about women and pay, we often focus on high-paid jobs and the lack of women occupying positions in FTSE 100 company boardrooms. It is important to ensure that women have career progression, especially when the TUC has reported that the pay divide between men and women is nearly 55% among top earners.

[Mr Jim Cunningham (Coventry South) (Lab)]

I congratulate my hon. Friend on securing this Adjournment debate. She is right: equal pay issues have been around for about 50 years—it is 45 years since the Act was introduced—and that is far too long in my book. More importantly, when women on zero-hours contracts apply for tax credits, they cannot get them, because they are not in steady employment. What does my hon. Friend think about that? Equally, women are discriminated against when it comes to pensions, because a lot of them spend most of their lives being housewives.

[Ruth Cadbury]

My hon. Friend is absolutely correct: this is about not just the low pay women receive, but the interconnection with zero-hours contracts, the benefits regime, tax credits and, of course, pensions, because a working life on low pay means a retirement on a low income.

Although the pay gap among top earners is nearly 55%, we also need to ensure, as my hon. Friend said, that we address women’s pay at the other end of the spectrum, among those who are stuck in low-paid minimum wage jobs, who are, too often, on a zero-hours contract. Indeed, the majority of low-paid workers are women, and three in five minimum wage jobs are held by women.

Every major piece of legislation that has improved the lives of women has been introduced by the Labour party. From the National Minimum Wage Act 1998 to the Equality Act 2010, Labour has always been at the forefront of the fight for equality. The Government certainly know how to talk the talk on equality, and the Prime Minister pledged to end the gender pay gap “within a generation”, but with 85% of Government tax and benefit cuts hitting women, Ministers are giving with one hand and taking from women with the other.

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[Ruth Cadbury]

My hon. Friend is right. Children growing up in poverty do not have the same advantages and opportunities as many in their peer group. We cannot have a situation in which the adults of the future are not able to develop as they should in an equal, fair society.

Among examples discovered by the TUC of how brazen companies can be when they employ women was an advertisement in Wales for two seasonal roles—Santa Claus and Mrs Claus. Santa was to be paid a fair wage of £12 per hour, while Mrs Claus was paid the national minimum wage of £6.70 per hour. There was no difference in their job descriptions, and they both did the same amount of work, but the woman’s role was deemed to be of less value. That may seem like an interesting one-off, but it perfectly demonstrates how differently men’s and women’s work is valued 45 years after the implementation of the Equal Pay Act 1970.

Occupational segregation and the devaluing of work traditionally carried out by women, such as caring, directly contributes to the gender pay gap. That must be tackled and the Government must do more to diversify the labour market. As I have said, UK women earn on average 91% of what men earn. To put it another way, as of 9 November, just over a week ago, women are effectively working for free for the rest of the year. That is simply not acceptable in the 21st century. Progress has not been quick enough. Under Labour the gender pay gap reduced by a third—a trend that has, I admit, since continued; but while the gap has narrowed for full-time workers, it has widened for part-time workers and we must not be complacent.

[Mr Jim Cunningham]

My hon. Friend is very generous in giving way. It is difficult to see how Government policy can narrow the pay gap in the public sector when wage increases are held at 1%. Will my hon. Friend comment on that?

[Ruth Cadbury]

The public sector is in particular difficulties, but the reason for that is the incredibly tight constraints on its budgets. Having been a local authority lead member, I know the pressure and how difficult it is to juggle overdue pay increases and the need to retain jobs wherever possible, particularly in such vital sectors as social care.

The gender pay gap affects women from the day when they start work, and for the rest of their lives. Forty-five years after the passing of the Equal Pay Act 1970, we still have that gap. Earlier in the year Labour called for a new equal pay Act, acknowledging that the current one has simply not prevented inequality between genders. Indeed, the current Act puts responsibility for enforcing equal pay on women, by allowing a woman to take her employer to a tribunal, rather than making it a collective responsibility. Going to an employment tribunal is a difficult process, and it is now a costly one. First, the employee must be a member of a trade union if she cannot pay for a lawyer or represent herself, and many people are put off at that stage. However, if an employee is successful, the tribunal will instruct the company to do an equal pay audit; but how many women even get to that stage? Yesterday I participated in a Parliament outreach initiative on Twitter, and there was some debate. Women talked about their experiences, and many said they would not challenge an employer, even if they thought they were being paid less than their male counterparts. They feared being sacked. One woman said that equal pay audits might be useful, but that she feared many women would

“stay silent for fear of losing their jobs”.

The Government cannot simply point to the existing measures and say they are tackling the gender pay gap, when people do not have access to the tools that are provided. More needs to be done to make the tribunal process accessible, and to give women the confidence to challenge their employers about fair pay. There is also a need to move away from putting the responsibility on the employee to fight for equal pay, and towards collective responsibility. That is what Labour argued for at the beginning of the year. It is impossible for a woman to demand equal pay if she does not know what her male counterpart is earning. An equal pay audit should come at the beginning, not the end, of the process.

Where can we go next? In July, the Prime Minister proclaimed that he would end the gender pay gap in a generation. I welcome any efforts to address the hopeless situation we are in, but we need more attention paid to women on low pay, rather than simply focusing, as I fear the Prime Minister may have done, on women in highly paid jobs. I recognise recent efforts to address the pay gap between men and women, which are commendable. Legislating for companies that employ more than 250 people to publish the difference between men and women employees’ pay is a good way to push companies to pay men and women equally, to avoid embarrassment and public naming and shaming. However, traditional women’s employment in the five Cs—clerical, catering, caring, cashiering and cleaning—is often in smaller companies, which will not need to publish that information.

We must also acknowledge the need to address not simply the discrepancy between wages but the value of women’s work. The Government need a strategy to boost the esteem and pay of the jobs typically undertaken by women. Raising the minimum wage by the end of this Parliament and rebranding it does not fool me, or those women working for wages below the true living wage—the wage calculated as enough to live on. Cutting tax credits for millions of working families does not fool them either. The Government may talk the talk on equality but, while 85% of their tax and benefit changes fall on women, the cuts agenda compromises any chances of improvement for women on the lowest pay.

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[Colleen Fletcher (Coventry North East) (Lab)]

I congratulate my hon. Friend the Member for Brentford and Isleworth (Ruth Cadbury) on securing this important debate on a subject that affects women in every constituency the length and breadth of the country, my own included. I intend to keep my contribution brief, focusing on low pay in Coventry and the impact on women locally.

Nearly one fifth of all jobs in Coventry, equivalent to 26,000 roles across the city, paid less than the living wage last year. The majority of those low-paid jobs are concentrated in sectors and roles within the labour market that are overwhelmingly dominated by women, such as care assistants, cleaners, caterers and those working in the leisure and service industry. Although we know those types of job are crucial and help to hold the fabric of society together, they are all too often part time and low skilled, with few progression opportunities.

[Mr Cunningham]

My hon. Friend will be as aware as I am that Coventry was one of the leading authorities in implementing the living wage. More importantly, she mentioned that carers are among the lowest paid. If a carer wants to go to a tribunal without trade union support—I have seen cases of this—on average it costs £1,200, and most carers cannot afford that. That is a direct result of this Government’s policies.