On gender pay, the inquiry will look at issues around the compliance of businesses with reporting requirements on the gender pay gap, such as whether the regulations are properly capturing the salaries of staff, and what steps companies are taking to address the pay gap. The committee will also look at measures to be taken against companies which do not comply with reporting requirements.

On executive pay, the committee will be checking on the implementation of the Prime Minister's undertaking to crack down on excessive executive pay. It will look at progress in simplifying the structure of executive pay and pay reporting, and the role of remuneration committees, institutional investors and shareholders in curbing excessive pay.

MPs are likely to be examining the use of ‘clawback’ provisions to recover cash and share bonuses in the event of poor performance.  The committee cites evidence from its recent inquiry into Carillion, which clawback terms were relaxed in 2016, meaning that cash and share bonuses could only be recovered if the firm's results were misstated or the executive was ‘guilty of gross misconduct’.

Rachel Reeves, chair of the BEIS committee, said: ‘Excessive executive pay and gaps in gender pay are at root an issue of fairness. Pay awards for top bosses which vastly outstrip worker pay and which owe little to building genuine long-term value in a company are impossible to justify and damage the social contract between business and the public.

‘Unjustified executive pay awards are the most corrosive influence on public trust in business and businesses must face up to their responsibilities and tackle this problem. If businesses don't step up on executive pay, Government will need to step in.

‘Transparency on gender pay is only the beginning. We need to examine why these pay gaps persist, why within the same sector there may be companies with wildly differing pay-gaps, and what remedies are needed to tackle them.’

This inquiry is initially scheduled for two evidence hearings with an opening session on gender pay reporting due to take place on 17 April and a session on executive pay on 16 May.

The deadline for submitting evidence on gender pay gap reporting is 10 April, and for executive pay the deadline is 8 May. Submissions should be made separately.

Separately, the Equality and Human Rights Commission (EHRC) has warned employers they are entering the ‘last chance saloon’ to report their gender pay gap. The deadline for public sector organisations with over 250 staff is 30 March, while the date by which businesses and charities with over 250 staff must publish pay data is 4 April.

EHRC has published its enforcement strategy, which will start when the commission writes to all employers who have not complied with the law. The letters will be sent on 9 April and employers will be given 28 days to comply before an investigation takes place and an unlawful act notice is issued. Failure to comply with the regulations will ultimately lead to an unlimited fine decided by the courts.

Current estimates suggest around 3,700 companies have logged details of their gender pay gap on the government equalities website, but some 5,000 have yet to do so.

The gender pay gap reporting website is here.

Closing the gap: enforcing the gender pay gap regulations is here.

BEIS committee inquiry details are here.

For more information on pay and benefits visit Croner-i Human Resources.

Report by Pat Sweet