MEPs on the European Parliament economic and monetary affairs (ECON) committee have backed Labour amendments to tackle the gender pay gap in the financial sector. The committee has backed proposals for credit institutions and investment firms to have a gender neutral remuneration policy.
Neena Gill MEP, member of the ECON committee, said:
“For too long women have earned less than men. In all jobs, across all sectors, especially the finance sector, where companies have deployed opaque remuneration and bonus practices, free from scrutiny, emboldened to do as they wish.
“The proposals I made, which were backed by a majority in the committee, will ensure the principle of equal pay for equal work for male and female workers are applied in the finance sector, with gender neutral remuneration policies in credit institutions and investment firms.
“Nearly eighty per cent of firms in the UK pay men more than women, with men making up the majority of higher-paid jobs. In terms of bonuses, in the finance sector women receive 35 per cent less than men on average, and in many cases it is much worse - in Barclays Bank, for example, women get a 27p bonus for every £1 bonus paid to a man. In the whole economy, in every sector the median hourly pay for men is greater than that for women.
“The European Parliament now has a mandate to take forward our proposals to tackle these disparities, and we urge national governments to work with us in the negotiations, and for all MEPs to back us when the proposals are put to a full vote.”
Mary Honeyball MEP, vice chair of the European Parliament women’s rights and gender equality committee, said:
“This is great news, and brings us a step closer to dismantling the gender pay gap. There can be no social equality without economic equality, and these new measures show once again that the EU, and Labour MEPs in the European Parliament, are taking the lead - unlike Tory MEPs, who failed to back the proposals, and the Tory government.
“It is disgraceful that women in the UK earn just 81p an hour for every pound a man earns - this is the sixth highest gender pay gap in the EU. Labour MEPs want true equal pay, and for companies that discriminate against women to be held to account.”
The Capital Requirements Directive and Capital Requirements Regulation package, the Simon report, to which Neena Gill MEP tabled these amendments to address the gender pay gap, will now be subject to negotiation between the European Parliament and Council, and then a final vote.
Wednesday, June 20, 2018
Notes to Editors:
The key points in the amendments are:
- The principle of equal pay for male and female workers for equal work or work of equal value is laid down in Article 157 of the Lisbon Treaty - this needs to be applied in a consistent way by credit institutions and investment firms, therefore they should demonstrate a gender neutral remuneration policy.
- A gender neutral remuneration policy in a credit institution or investment firm means a remuneration policy based on equal pay for women and men for equal work or work of equal value.
- Financial Institutions shall have robust governance arrangements, which include a clear organisational structure with well-defined, transparent and consistent lines of responsibility, effective processes to identify, manage, monitor and report the risks they are or might be exposed to, adequate internal control mechanisms, including sound administration and accounting procedures, and remuneration policies and practices that are consistent with and promote sound and effective risk management. Those remuneration policies and practices shall be gender neutral.
- The European Banking Authority (EBA) shall issue guidelines on the arrangements, processes and mechanisms referred to in 1, in accordance with 2. One year after the adoption of this directive, the EBA will issue guidelines on gender neutral remuneration policies for credit institutions and investment firms. Two years after the publication of these guidelines and based on the information collected by the national competent authorities, the EBA will draft a report about the application of gender neutral remuneration policies by credit institutions and investment firms.
- Competent authorities shall collect the information disclosed in accordance with the criteria for disclosure established in points (g), (h), (i) and (k) of Article 450(1) of EU Regulation No. 575/2013 (on prudential requirements for credit institutions and investment firms), as well as the information provided by credit institutions and investment firms on the gender pay gap and shall use this information to benchmark remuneration trends and practices. The competent authorities shall provide the EBA with that information.