Workplace Pay Gaps

Jim Shannon Excerpts

Tuesday 7th January 2025 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to serve under your chairship, Sir Roger. I thank the hon. Member for Brent East (Dawn Butler) for leading today’s debate. She has worked incredibly hard on this issue. It is good that we can discuss its effect across this United Kingdom of Great Britain and Northern Ireland. I wish to add a Northern Ireland perspective to the flavour of the debate, and to give some examples from Northern Ireland of where there has been a shortfall, where it has been addressed and what we can do better.

With regard to geography, ethnicity, gender and so on, the UK has witnessed, in the past and presently, pay gaps in certain industries. This debate is important to get a full perspective on the situation in the United Kingdom of Great Britain and Northern Ireland. For example, there was a large disparity in teachers’ pay in Northern Ireland, which coincided with the failure of the Northern Ireland Assembly to meet for some time. There was a clear problem of unfairness to teachers working in Northern Ireland. In April last year, a formal offer on teachers’ pay for 2021, 2022 and 2023 was accepted by Northern Ireland’s five main teaching unions. The pay settlement agreed by the Teachers’ Negotiating Committee included a clause on a starting salary of £30,000 for teachers in Northern Ireland.

That is really important because for too long the teachers in Northern Ireland had lagged behind in pay negotiations and pay awards. That 24.3% increase in starting salary is to be warmly received and it makes that salary equal to England, as it should have been for a long time. The title of this debate is “Workplace Pay Gaps” and those are for both males and females, although I will refer to where women have been disadvantaged in other ways, but there should be absolutely no pay disparity anyway. Equality for teachers in Northern Ireland has eventually been achieved after four years. It is absolutely to be welcomed, but waiting on it for four years is hardly fair.

Additionally, there have historically been issues in Northern Ireland and further afield in the United Kingdom regarding the pay gap between men and women. The Department for the Economy in Northern Ireland has revealed that, as of 2023, the overall gender pay gap in Northern Ireland stood at 7.8% in favour of males. The hon. Member for Brent East referred to that issue, and I thank her for it. It has to be addressed by companies across Northern Ireland.

[Mr Gregory Campbell (East Londonderry) (DUP)]

My hon. Friend and the hon. Member for Brent East (Dawn Butler) have both alluded to the gender pay gap. Whatever the justification or otherwise might have been 30, 40 or 50 years ago, when there were different roles in society for males and females in employment, does my hon. Friend agree that those days have long passed? There must now be no distinction of any kind, whether it is based on gender or on any other differential. There needs to be pay equality right across the spectrum.

[Jim Shannon]

I wholeheartedly agree. For instance, apprenticeships are available at Thales in the armament and military production line in Belfast, and young girls and ladies have the same opportunities as young fellas and men. The same applies at the shipyard and at engineering firms across Northern Ireland, especially in my constituency. I have seen the advantage of those apprenticeships. My hon. Friend is right to raise that point.

For every £1 earned by men, women earn only 92p. That has to be addressed: we need wage equality. Where employers are perhaps reluctant to provide it, the Government need to step in legislatively. The gender pay gap favours females when we consider full-time and part-time employees separately—there are gaps of 3.5% and 1.7% respectively—so there are some anomalies to be addressed.

The gender pay gap has narrowed over the years. It has decreased from 22.4% in 1987 to 8.7% in recent analysis: over 27 years, there has been a great drop in the disparity. My hon. Friend the Member for East Londonderry (Mr Campbell) compared the historical position with where we are today. I believe that the trend reflects ongoing efforts towards gender pay equality.

UK-wide, we have witnessed further pay disparities that certain ethnic minority groups experience in comparison with white employees. The hon. Member for Liverpool Riverside (Kim Johnson) was absolutely right to highlight that clear gap, and the clear evidential gap to be addressed. For instance, in the 10-year spell between 2012 and 2022, black, African, Caribbean and black British employees consistently earned less than their white counterparts.

Furthermore, studies by the Northern Ireland Statistics and Research Agency have identified pay disparities between disabled and non-disabled employees in Northern Ireland. I think the hon. Member for Brent East referred to that disparity in her speech. Goodness me! If they are doing the same job to the same ability, they should be getting the same pay. There should be no disparity just because someone happens to be in a wheelchair, have a visual or hearing disability or have a mobility issue. That cannot be ignored. For example, employees reporting fair health, which is a proxy for disability, experienced a gender pay gap—wait until you hear this one—of 16.8%. Those who reported very good or good health experienced narrower gaps of 8.1% and 8.4% respectively. There is a real gender pay gap for disabled people.

Perhaps the Minister can give us some idea whether she has had any discussions with the Minister back home. There is no doubt that much progress has been made in addressing these issues, but there is still a long way to go. There is significant work to be done to ensure full pay equity across all demographics, not just in Northern Ireland but further afield in the United Kingdom. Has the Minister had a chance to raise that issue with the Northern Ireland Assembly?

There is hope that legislation can be introduced to address these issues. I look to the Minister today for a commitment to ensuring that they are resolved. I understand that many of the issues are devolved, but the Government here have a responsibility, centrally, to ensure fairness in pay across all employment sectors.

[Several hon. Members rose—]

--- Later in debate ---

[The Minister for Equalities (Seema Malhotra)]

It is a pleasure to serve under your chairship, Sir Roger. I congratulate my hon. Friend the Member for Brent East (Dawn Butler) on securing this important debate. I thank her, as other hon. Members have, for her long-standing advocacy and campaigning on the issues, which she demonstrated deeply in her speech today. I am proud to have worked with her on them. I also acknowledge the contributions made by hon. Members on both sides of the House, which were summarised well by the Opposition spokesperson, the hon. Member for Huntingdon (Ben Obese-Jecty). I am pleased to see the support for our direction of travel, and I see that we need to go further and faster.

I hope to comment on as many of the issues as possible that colleagues have raised. I thank the Opposition spokesperson for his comments, but I will say that if there had been as much passion for and commitment to some of these issues over the past 14 years, and such a focus on the Conservative party’s record, there would have been greater change than there was. I hope that he will continue to be a strong voice on these issues, not just in Parliament but in his party.

Today’s debate is a welcome opportunity to reaffirm and highlight the Government’s commitment to workplace fairness. I am incredibly proud that the work we are taking forward in this Parliament comes on the back of a long history of commitment to equalities legislation, whether that is the Equal Pay Act, the Race Relations Act 1965, the Sex Discrimination Act 1975 or the Equality Act.

One of the key ways that we can measure fairness in the pay that workers receive is by looking at pay gaps. Pay gaps look at the differences in the average pay between groups—for example, the average earnings of women compared with men—while equal pay is a direct comparison of the pay of individuals doing the same or similar work. We have had a number of contributions today on the ranges of and differences in pay gaps.

Pay gaps do not necessarily mean that pay discrimination has taken place, but frankly, they often do. They can point to opportunities not provided and processes that lock people out. Those are issues of fairness and workplace security. Pay gaps can also mean that employers are missing out on the talents and skills of a diverse workforce and all the benefits that come with that. Closing pay gaps of all kinds is in everyone’s interest, which is why we want to go further and faster in this Parliament to reach that ambition. It makes sense for business, society, employers and our economy.

The timing of this debate is welcome, given that—as my hon. Friend the Member for Brent East said—Ethnicity Pay Gap Day falls tomorrow, on 8 January. I acknowledge the work of Dianne Greyson and other campaigners. Since 2018, the campaign has highlighted the need for decisive action to tackle ethnicity pay gaps. Like Disability Pay Gap Day, which was marked on 7 November, and Equal Pay Day on 20 November, the date serves as a reminder of just how far we have to go. We know that ONS data shows that black, African, Caribbean and black British employees have consistently earned less than white employees, when looking at median gross hourly pay. In 2023, the pay gap between disabled and non-disabled employees was 12.7%, and in 2024, the gender pay gap still stood at 13.1%.

A number of issues have been raised—not just by my hon. Friend—in relation to accountability, enforcement, regional variation, the right to know, and so on. I will make a few remarks before addressing those points, although I recognise that there may be a shortage of time to address all the points that have been raised today, so I will also be happy to pick them up with hon. Members afterwards.

I am proud that in the King’s Speech in July, we strengthened our plans to introduce legislation to root out inequalities and strengthen protections against discrimination. As part of the King’s Speech, we announced the equality (race and disability) Bill, through which we will introduce mandatory ethnicity and disability pay gap reporting for employers with 250 or more employees, building on the requirement to publish gender pay gap data. That is a major next step in equalities legislation.

The debate on the publication of an ethnicity pay gap report has had the engagement of a range of key stakeholders, including the Runnymede Trust, the Chartered Institute of Personnel and Development, Business in the Community, ShareAction, Unison and many others. We also know that many ethnic minority workers still face barriers to progression in the workplace. For example, in March 2023, over 26% of the workforce across NHS trusts in England, but only 11% of those at senior manager level, were from an ethnic minority background.

Similarly, although there has been growth in employment rates for disabled people in recent years, there are still significant gaps, as my hon. Friend the Member for Ealing Southall (Deirdre Costigan) laid out. As we know, disabled people have, on average, lower incomes than non-disabled people, and I want to make a couple of comments about the disability pay gap and employment issues. I know that my hon. Friend, who has expertise in this area, has met the Minister with responsibility for disabled people, my right hon. Friend the Member for East Ham (Sir Stephen Timms), to discuss the disability employment charter. We are taking those comments into account in our response to the Public Services Committee that I hope will be coming shortly. We also remain committed to publishing the findings of the disability workforce reporting consultation 2021-22.

[Jim Shannon]

Will the Minister give way?

[Seema Malhotra]

I am conscious of time.

[Seema Malhotra]

Thank you, Sir Roger. I will give way.

[Jim Shannon]

I thank the Minister for her contribution; she will know that my questions to her will never be adversarial. She has referred to disability action. Has she had an opportunity to discuss these matters with the equivalent Minister in the Northern Ireland Assembly? That was the thrust of my contribution, as it is really important that we in Northern Ireland follow the same line of thought as happens here.

[Seema Malhotra]

I understand that we are engaging with our colleagues in the devolved Governments, and across the country in relation to mayors playing a part, and I am very happy to pick that point up with the Minister for Disability. It is a priority for this Government to engage much more with our devolved Governments and work together to ensure that the voice of the whole UK is heard in the legislation that we are bringing forward.

I want to make a couple of comments about parental and shared leave and employment rights. Our plan to make work pay included a commitment to review the parental leave system alongside our wider plans to boost family friendly rights, so that workers and employers can benefit from improvements in productivity and wellbeing. The Employment Rights Bill will make existing entitlements to paternity leave and unpaid parental leave available from day one of employment, and will enable parents to take their parental leave and pay after their shared parental leave and pay.

We are improving access to flexible working, which will be extremely important in how we move forward further in this space.