Mind the (Gender Pay) Gap!

Posted 05/04/2016 By: Claire Sleep

Gender pay gap reporting has been on the government’s agenda for some time now. The government put in place a voluntary scheme in 2011 to enable employers to consider and address its gender pay gap. However this resulted in only 4 organisations voluntarily publishing gender pay data by August 2014.

After consultation, the government published a response on 12 February this year which showed that the majority of employers who responded to the consultation felt that the publication of gender pay information would encourage employers to take action to close the gender pay gap.

Further consultation on the draft regulations closed in March 2016 and final regulations are likely to come into force on 1 October 2016.

So what will be the impact of the final regulations? Based on what is currently in the draft regulations, employers should be aware of the following:

• The gender pay reporting requirement applies only to employers with more than 250 employees in a single legal entity on 30 April 2017 and the anniversary of that date thereafter;
• The regulations do not apply in the public sector but this is likely to be dealt with by future regulations;
• Data to be published on a searchable website by 29 April 2018 and then annually thereafter. Data also needs to be uploaded to a government website;
• Data needs to show differences in mean and median pay and the difference in mean bonus pay of men and women as well.It also needs to show the proportions of men and women who received bonus pay and who are employed in quartile pay bands of overall pay within the organisation. We await clarification on how the quartiles are calculated as this has caused most confusion and disagreement to date.
• Data snapshots are to be taken on 30 April 2017, save for bonus information which is calculated over the 12 months preceding 30 April 2017.

It should be noted that none of the above measures of pay require actual pay rates to be published, just the percentage difference in pay or the proportion of the number of male and female employees. In addition, explanatory text on the data is optional and can be provided by an employer.

As an employer, preparatory steps need to be taken to ensure compliance with the final regulations and to ensure positive publicity is obtained for being proactive and progressive about tackling gender pay inequality. In order to achieve this, action should now be taken. Please contact Claire Sleep at Ashtons Legal for more guidance on the suggested steps that should be considered and taken to prepare for the new gender pay gap reporting requirement Claire.Sleep@ashtonslegal.co.uk or 01223 431094.