The new equality legislation will create added costs for British businesses, at a time when they should be concentrating on survival, according to Lucy Saunders.

The Equality Bill wants to remove discrimination of all kinds from every aspect of society, and create a mythical level playing field where everyone can be everything. However, in a recession (particularly one that is likely to be long and difficult), survival is the driving force. This legislation creates a situation that makes British business less competitive than its international competition at a time when competitiveness is all. Fairness is a luxury of a wealthy, healthy economy.

It is easy to see the lacuna where logic is used to paper over the cracks of argument. For instance, the Bill will stop businesses banning staff from talking about their salaries. I’ve never come across a business that needs to ban people talking about their salaries. A whole lot of reticence, innuendo and gossip guards the real deal that people are on. Then there are the questions of what should be seen as part of a salary; are expenses part of a salary? (Or is that only for MPs?) The current culture is one of secrecy around salaries and legislation is a very slow way of changing culture. In reality, we want to know everyone else’s salary but we don’t want them to know ours.

The other big area for business in the Bill is the idea that every business with more than 100 employees should report its gender pay gap. This assumes that every business will have a gender pay gap. I feel an immediate burgeoning of specialist consultants waiting to tell businesses how to analyse their workforce and salaries to fulfil this requirement. I see hours of senior management time being absorbed by this process when, in a recession, I’d rather see all the management involved in helping the business survive.

Bureaucracy, however politicians repudiate it, is an inherent part of government – it is how it gets things done. Some business organisations are hugely bureaucratic, and this can be appropriate. I like the idea that health and safety on an oil rig is highly bureaucratic, because that actually keeps people alive. However, bureaucracy for business is another cost which will inevitably increase the cost of the product or service provided. It’s going to be hard to put prices up in the current market, if not impossible, and the business response may end up being ‘let’s just make someone redundant to cover the cost of gender gap reporting’.

It’s not just gender pay gap reporting that will create bureaucracy for business – public sector bodies will also have duty to use their purchasing power to buy only from companies that are seen to be delivering on the Bill. The tendering process for public sector work will become more complex at a time when the public sector is seen as the engine for growth in the economy.

The Bill claims that 23% of women are paid less than men for equal work. While this is reprehensible if true, is legislation is an appropriate way of changing this situation? It would be interesting to see how many cases on this issue have been prosecuted within the last couple of years and what the outcomes were. There will be many factors involved in creating this situation, from the availability of appropriate personnel to the unspoken edges of a job; the areas that get done but aren’t necessarily in the job description but are vital for good functioning in an organisation or team, such as being available at evenings or weekends to talk to suppliers or colleagues, or taking the time to console colleagues who are miserable for some reason. An hourly pay rate looks simple, yet it rarely translates exactly to the job done.

There are positive things about the Equality Bill. It replaces a lot of former legislation rather than adding to it, which is good news. At the same time, it is like a report card that says ‘could try harder’ and takes no time to understand why these situations exist. Like any legislation, it only becomes effective if it gets enacted.

Lucy Saunders is founder and MD of PR and marketing consultancy Mahseer.

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