My Lords, I am grateful to the noble Baroness for her support of our amendments. The Government very much believe in and are strongly committed to equal pay and the important laws that already exist. If there were enough time, and perhaps on another occasion, I might recount some of the stories that my mother used to tell me about when she first arrived in Nottingham as a teenager and was working in big factories and was very miffed to find that the men were paid a lot more than she was paid for doing the same job.
Businesses should be encouraged to make progress on complying with these important laws. Where it is not necessary, we should avoid a statutory approach in terms of making them comply. I recognise the point that the noble Baroness was making about progress in this area. There has been progress, but clearly more needs to be done. That is why this Government have introduced some measures to increase transparency on how pay is reflected in organisations. There seems to be quite a positive response to those voluntary measures.
We think that equal pay is so important, so we also believe that it is right to introduce these mandatory equal pay audits for businesses that have failed to comply with the law. When the law has been broken, they need to be forced to address that. That is why we believe that this is the right approach to take.
The noble Baroness raised some questions for me to respond to. She asked why equal pay audits are not available as an automatic right. We believe that carrying out a systematic pay audit of staff can be burdensome, and we do not want to place unnecessary burdens on employers who have done nothing wrong. We also feel that some employers are already carrying out these equal pay audits on a periodic basis and are using
them in a constructive and good way. We do not want them to feel that they are being unnecessarily penalised when they are already doing the right thing.
The noble Baroness asked whether we thought that, once this measure is in force, the equal pay audits will simply push employers to settle equal pay claims. Our view on that is that if any employer were facing a continuing claim against it on equal pay grounds, it would soon find that it would not be cost effective to keep settling those claims. I do not accept that that would be a consequence of this.
The noble Baroness asked why the equal pay audit would not cover other protected characteristics. As she and I have acknowledged, equal pay legislation for men and women has been in place for some 40 years. We think it is right to focus the audit on sex-based pay differentials alone as only there is there a specific right to equal pay, and the appropriate route of redress for discrimination due to any protected characteristic other than sex in matters relating to pay, is through the discrimination provisions in the Equality Act.
The noble Baroness also asked how the timeframe for carrying out an audit would be decided. New Section 139A of the Equality Act allows employment tribunals to be given discretion in,
“deciding whether its order has been complied with”.
I think those are all the questions that the noble Baroness—