Gender Pay Gap in Tesco: Aims, Legal Regulations, Costs and Benefits

This report discusses the issue of gender pay gap in Tesco, outlining the aims, legal regulations, costs and benefits for the company to deal with the issue. It also provides recommendations to reduce the gender pay gap.

Introduction to HRM

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Aims.......................................................................................................................................1
Legal regulations....................................................................................................................2
Costs and Benefits..................................................................................................................3
Recommendations..................................................................................................................4
CONCLUSION................................................................................................................................4
References:.......................................................................................................................................6
Books and Journals.................................................................................................................6
Online.....................................................................................................................................6

INTRODUCTION
In the competitive business environment the businesses solely depends upon their human
resource they hire. It is believed that better the troop of employees the better the outcomes
organisation will receive. But in the management of the human resource the organisation come
across different challenges and issues such gender pay gap, employee engagement, talent
management, zero hours contract etc (Miller and Vagins, 2018). The present report will discuss
the issue of gender pay gap by applying this to UK's top most retailer Tesco plc. The leading
British supermarket is the multinational organisation and has large size workforce to operate its
business all across the world. The company has multiple operations due to its diversified product
portfolio. The report will outline the aims, legal regulations and cost and benefits for the Tesco to
deal with issue of gender pay gap.
MAIN BODY
Aims
Gender pay gap- it is the term that defines the difference of remuneration for the men and
women employees working in the same organisation or industry. In the society or the world of
business the women's are generally paid less than the men. The common reasons for the
occurrence of the gender pay gap within the organisation is due to education, occupation, hours
of working, experience and some other constituents (Morchio and Moser, 2021). The gender pay
gap is issue for the organisation in current world where the women and society are fighting hard
for equal pay for equal work. Therefore, in regard of this Tesco plc also deal with this issue for
which has some significant aims that are discussed below:
 To create diversity in workforce: the main aim of the Tesco plc while dealing with the
issue of gender pay gap is to improvise the high level of diversity in the company. It is
believed by the Tesco to raise the bars of productivity, innovation of thoughts and most
importantly to grow sustainably the diversity is important. When in the retail industry
there will be equal men and women will work there by diversity of workforce which will
foster the productivity, creativity, emotional intelligence and profitability in the company
to persuade its customers (Costa Dias, Joyce and Parodi, 2020). This automatically
reduces the issue of gender pay gap in Tesco and helps the company to fulfil its aim of
building diversity.
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 To reduce gender inequality: In retail industry of the UK gender inequality is to huge
extent. Tesco with the change of its business model and sustainable development aims to
reduce gender inequality. The company by increasing the salary of the women, hiring the
women's from ground level to top level and by raising the promotion is aiming to reduce
the gender inequality in every business angle.
 To encourage women working: While dealing with the global issue of gender pay gap
the Tesco plc aims to create the jobs for the women by developing a recruitment
campaign for women hiring in order to balance the men and women working in the
organisation (Vahter and Masso, 2019). By this company aims to encourage the women
working in the retail industry and in Tesco. The encouragement of women working
willingly will reduce the women employment and also reduce the men dominant business
environment.
Legal regulations
The businesses operating in UK are required to make sure that they follow legal rules and
regulations outlined under the UK employment legislation. There are different legislations under
the issue of Gender pay gap in UK organisations that are discussed below:
National minimum wage act 1998: This the most important legal legislation for maintaining the
equal pays to each employees working for the specific hours within an organisation. Under this
law the minimum wage is set by the government of UK for the worker entitles to per hour. Tesco
plc is bounded by this law to pay their male or female workers with minimum pay set by national
minimum wage act. This helps the workers to deal with the issue of gender pay gap Tesco has to
pay minimum wage to all its workers (Amano-Patiño, Baron and Xiao, 2020).
Employment Right Act 1996: By the UK government employment rights act 1996 is issued for
the employees working in the UK based organizations (Employment Rights Act 1996, 2021). The
law protects the employees from the suspension of pay or any other disciplinary actions that
abide the women segment from the their right of equal pay. This law protect the women
employees from the gender pay gap issue by making dismissal for the misconduct by the Tesco
employers. The Tesco plc has effectively embedded this law in its human resource department to
reduce the gender pay gap.
Equality Act 2010: The equality act 2010 by the UK government is to legally protect the
employees from the discrimination at the workplace and in the wider society. In the
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organisations there is discrimination due to race, religion, sex, disabilities and much more which
make the employees abide from their rights (Equality Act 2010: guidance, 2022). Gender
discrimination is the most obvious and highly considered discrimination issue that is conducted
in the organisation that make the women's undergo the process of discrimination in terms of
promotion, payment, recruitment and much more (Brown and Rickard, 2018). In Tesco to build
the equality of gender this law is implemented with all the characteristic to avoid any loophole
and to encourage women employment without any discrimination.
Equal pay act 2010: Under the equality act 2010 there is the subsidiary act that provides the
women and men a right to get equal pay for the equal work (Equal pay, Information on the
legislation governing equal pay, 2022). The equal pay act 2010 make women and men legally
entitled to be paid same amount of remuneration for the like work at the workplace and also their
work must be rates equivalent and paid equal value. Under this law all forms of pay are included
such as salary, bonus, overtime pay, profit sharing, holiday pay and much more. The Tesco has
huge value and weight to this while working on salary and compensation of the employees.
Costs and Benefits
The reduction of the issue of Gender Pay Gap leads to different cost and benefits to the Tesco plc
that are discussed below:
 Increased cost of salary and compensation: when the Tesco plc will be dealing with the
issue of gender pay gap and to mitigate this issue the company will modify the salary
packages of the men and women employees which might cause the company to increased
cost of remuneration. This is big concern for the Tesco plc as the company has to manage its
other cost due to increase in this cost (Basson, 2019).
 Encourage women employee engagement: when there will be no gender pay gap the
Tesco will gain the benefit of the increase women employees’ engagement leading to higher
productivity and quality of work. The higher engagement of women works will bring more
quality in work and also the women employees’ satisfaction will bring sustainability in the
Tesco plc.
 Strengthen the global UK economy: when there will be close of gender pay gap by the
Tesco plc this will benefit the women in terms of increased earning, equal rights in society
and workplace. This will leads to strengthening of the global economy as when the equal
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men and women will work and earn there will be equal raise of economy without any
disturbance.
 Bolster the business performance: the reduction of the gender pay gap is highly useful in
increasing the business performance of the Tesco. As with this there is no insecurities and
bargaining power of the make staff to create dominance over the women staff thereby
reducing the conflicts and dissatisfaction (Fagan and Rubery, 2018). This is the reason that
employees more work for the attainment of organisational goals and objectives with
perpetuate to earn higher which bolster the business performance of the Tesco plc.
Recommendations
 It is recommended to the Tesco plc to modify their recruitment strategy and process in order
to equalise the women and men recruitment in the company. This will help the Tesco plc in
reducing the gender equality in the recruitment and hiring and also equal number of men and
women will be working in the organisation which directly leads to equal payment.
 The Tesco plc is suggested to improvise the equal promotions, appraisals and salary
increment for the men and women employees. This will reduce the gender pay gap and also
for this company is suggested to use equal pay act at the time of promotion and appraisal
process to maintain equality in pay (Jones, Makepeace and Wass, 2018).
 The Tesco plc is also recommended to improvise the training and programmes that strictly
promotes gender equality and also train and guide the HR manager and recruitment team
regarding the process of recruitment and to develop the process that maintain gender
equality and has no symbol of gender pay gap.
CONCLUSION
It is concluded from the above report that human resource is the life blood for the
organisation therefore their management is the key activity for every firm to stay competitive.
The gender pay gap is the huge problem still faced by the employees within an organisation
making them de- motivated towards their job and also lowers their job satisfaction and
capabilities. Therefore the organisation aims to reduce gender inequality and pay gap to promote
healthy and sustainable working environment. There are laws like equality act 2010 and equal
pay gap that protect the women and men discrimination in terms of pay and compensation. Thus,
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the dealing with this issue may cause increase in cost of remuneration for the company but leads
to women working which is beneficial for the firm's sustainability and growth.
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References:
Books and Journals
Miller, K. and Vagins, D.J., 2018. The simple truth about the gender pay gap. American
Association of University Women.
Morchio, I. and Moser, C., 2021. The gender pay gap: Micro sources and macro consequences.
Costa Dias, M., Joyce, R. and Parodi, F., 2020. The gender pay gap in the UK: children and
experience in work. Oxford Review of Economic Policy, 36(4), pp.855-881.
Vahter, P. and Masso, J., 2019. The contribution of multinationals to wage inequality: foreign
ownership and the gender pay gap. Review of World Economics, 155(1), pp.105-148.
Whitehouse, G. and Smith, M., 2020. Equal pay for work of equal value, wage-setting
and the gender pay gap. Journal of Industrial Relations, 62(4), pp.519-532.
Amano-Patiño, N., Baron, T. and Xiao, P., 2020. Equilibrium wage-setting and the life-cycle
gender pay gap.
Brown, D. and Rickard, C., 2018. Gender pay gaps and solutions: What can governments and
employers do to deliver equal pay–what works?. In The Routledge Companion to
Reward Management (pp. 125-146). Routledge.
Basson, D., 2019. Equal pay for equal work and work of equal value: bridging the gender pay
gab (Doctoral dissertation, University of Pretoria).
Fagan, C. and Rubery, J., 2018. Advancing gender equality through European employment
policy: the impact of the UK's EU membership and the risks of Brexit. Social Policy
and Society, 17(2), pp.297-317.
Jones, M., Makepeace, G. and Wass, V., 2018. The UK gender pay gap 1997–2015: What is the
role of the public sector?. Industrial Relations: A Journal of Economy and
Society, 57(2), pp.296-319.
Online
Employment Rights Act 1996, 2021.[Online], Available through:<
https://www.politics.co.uk/reference/employment-rights-act-1996/>
Equal pay, Information on the legislation governing equal pay, 2022.[Online], Available
through: < https://www.cipd.co.uk/knowledge/fundamentals/emp-law/equal-pay#gref>
Equality Act 2010: guidance, 2022.[Online], Available through: <
https://www.gov.uk/guidance/equality-act-2010-guidance#:~:text=The%20Equality
%20Act%202010%20includes,an%20exception%20from%20the%20ban>
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