Unions say urgent action is needed as Birmingham Council is plunged into financial chaos
The council could owe as much as ÂŁ760 million in equal pay compensation.
Birmingham City Council says it's in talks with the government after revealing it has to pay up to ÂŁ760m in equal pay claims for women workers.
It's the equivalent to its entire annual spending on services and is growing by up to ÂŁ14m each month.
It means the local authority will have fewer resources in the future and would have to reprioritise where it spends taxpayers' money.
It also apologised for failing to get the situation under control.
The GMB union called on Birmingham City Council to act urgently after the Council's Chief Executive announced the cost of settling claims against the pay discrimination.
Birmingham City Council has already had to pay out more than ÂŁ1.1 billion in settling previous equal pay debts over the past decade, but today the council confessed that discriminatory pay practises are ongoing, and they have racked up a new liability that the council estimates to be between ÂŁ650m and ÂŁ760m.
GMB members at Birmingham City Council have been campaigning for equal pay since November 2021.
Based on the council’s estimate that their equal pay liability is growing between £5million and £14million per month, had the union’s claims been settled in November 2021, the council’s liability could be as much as £266 million lower.
Michelle McCrossen, GMB Organiser, said:
“GMB members in Birmingham City Council have been campaigning for equal pay for years, because we believed that the council’s pay scheme discriminates against its women workers. Today’s shocking confession from the council proves that we were right to do so.
“The council has fought our union every step of the way, defending their discriminatory pay scheme at tribunal hearings and refusing to release pay information.
“Now we can see why. The extent of the discrimination is far worse than anyone could have imagined, and it’s clear the council has learned nothing from their shameful history of undervaluing women’s work.
“Today’s explosive admission from the Chief Executive completely blows apart the Council’s legal defence, so it’s now time for them to get serious about meeting with GMB and repaying the wages stolen from their low paid women workers.
“GMB will continue to fight until our members get what they’re worth.”
Cllr Robert Alden, Leader of the Opposition & Birmingham Local Conservatives, said: "The Council have cancelled three meetings regarding equal pay in recent months, seemingly as they had no developments. Yet now we know Labour have run up a ÂŁ760m plus bill and hidden it from the taxpayers of this city.
"This is because of Labour's failure to take action over the last decade. They cannot even claim to have not been aware of this since, as Labour Councillors, they not only have briefings from officers, but they also happily shared union claims that the Council wasn't paying staff fairly! Despite being in control, Labour failed to actually deal with the issue and stop it from continuing, leading to this shocking debt building up under Labour's watch".