Employers would have been forgiven for letting gender pay gap reporting slip down the agenda. Many employers focus in recent months has been on preparing for the impact and cost of the Apprenticeship Levy . That coupled with the fact that the regulations detailing precisely how gender pay gap reporting will operate had yet to be finalised, saw some employers moving this down their workforce “to do” list. However, and after a long wait, the final version of the regulations has now been published. This will no doubt see gender pay gap reporting and more generally, equal pay, moving back towards the top of the HR agenda for a large number of organisations.
In summary, the key obligations are:
- The compulsory reporting regime applies to all private and voluntary sector employers with 250 or more employees. This will be extended to public sector employers in due course under the Government’s plans;
- Annual reporting of gender pay gap data by April each year with the first set of pay data to be published by April 2018 in respect of April 2017 information; and
- Information is to be published on the employer’s website which is accessible to employees and the public. There is also a requirement to upload the information on to a government website although as I understand it that website still has yet to be built!;
Some employers may see the April 2018 data as a long way off. However, if your organisation falls within the reporting obligation you need to be taking steps now so that you are ready to start collection of the April 2017 data at an early stage. The pay data to be included in a report is not something that will be easy to print off the payroll system a few days prior to the April 2018 publication deadline. Organisations are required to publish 6 key pieces of data in respect of its employees (which has a broad definition and could cover many self-employed workers as well as traditional employees) which cover the following:
- Mean average gender pay gap;
- Median gender pay gap;
- Mean gender bonus gap;
- Median gender bonus gap;
- Proportion of men and women getting a bonus; and
- Proportion of men and women in each of four pay quartiles.
Giving early consideration to obtaining the data will also allow an employer to comment on that data when they publish the information. Whilst this isn’t a legal requirement, I can see many employers wanting to provide additional information to put that data in some sort of context. This will be particularly important if the data does reveal a noticeable gender pay gap.
At the moment, there is no sanction or financial penalty for employers who fail to meet their reporting obligations. However, failure to comply will have consequences nonetheless. For example, prospective employees are far more savvy these days in the research they conduct on any prospective employer. A failure to publish information could raise concerns with a prospective employee that causes them to look elsewhere.
For employees who are below the 250 employee threshold, whilst the reporting obligations won’t apply, the issue of gender pay gap and equal pay is not one that should be ignored. The introduction of the regulations is likely to see increased publicity around the topic of equal pay and the gender pay gap. The Government itself has published a tool to assist employees in finding the equal pay gap in their job – http://visual.ons.gov.uk/find-out-the-gender-pay-gap-for-your-job/ which is likely to highlight the issue to employees.
Equal pay claims which were perhaps once seen as a public sector issue will become the concern of the private sector with increased litigation to follow. Whilst a gender pay gap does not of itself prove unlawful pay discrimination, it may at the very least be seen as a useful indicator of the possibility of discrimination The ongoing Asda equal pay case is perhaps a warning sign to employers in the private sector of the risks that they may face if the issue isn’t addressed.
If you would like to find out more information about gender pay gap reporting , how it impacts on your organisation and what you need to do to comply, please contact Matt Jenkin, Employment Partner at Moorcrofts on 01628 firstname.lastname@example.org.