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2018 Gender Pay Gap Reporting Update

Posted on 11th January 2018
HR practice

If your organisation had 250 or more employees on the snapshot date of 5 April 2017 (or 31 March 2017 for public service employers) you have to comply with the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 (‘GPG Regulations’). This briefing is an updated summary of the aims of the GPG Regulations and what you need to do to comply.

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Simon Quantrill Simon
Managing Partner Telephone: 01473 688100

What is the gender pay gap?

The gender pay gap is the difference between the earnings of men and women. It is different to the obligation to pay men and women the same for carrying out the same or similar jobs or for carrying out work of an equal value (known as equal pay). Failing to pay equally is unlawful but having a gender pay gap is not. 

Statistics tend to show there is a widespread gender pay gap, with men generally being paid more than women. The ‘gap’ varies by sector and in some cases men are paid less than women, although this is less common. In 2016, according to the Office for National Statistics, women were paid 9.4% less than men for full-time employment and this gap increased to 18.1% when taking into account all employment.  Pro-rata part-time workers (men and women) earn less than full-time workers, with women more likely to work part-time than men.

What are the reporting requirements?

An employer with 250 or more employees on the snapshot date of 5 April 2017 (or 31 March 2017 for public service employers) will be subject to the reporting requirements. The first report must be submitted by 4 April 2018 (or 30 March 2018 for public service employers). 

The definition of “employees” is wide, for example it includes casual workers and bank staff, as well as those engaged under a zero hours contract. Some contractors and self-employed individuals as well as employees working abroad will also be included in the total.  If you are close to the threshold of 250 employees you should seek advice about who is and is not included to ensure you do not inadvertently fail to report.

The following information must be calculated and published:

  • The mean gender pay gap.
  • The median gender pay gap.
  • The mean bonus pay gap.
  • The median bonus pay gap.
  • The proportion of men receiving a bonus payment.
  • The proportion of women receiving a bonus payment.
  • The proportion of men and women in each salary quartile band.
  • A written statement, authorised by a senior person with appropriate authority, confirming the accuracy of the publication.
The calculations are complex and the requirements specific. The mean figure gives an overall indication of the gender pay gap.  As this figure could be distorted where, for example, bonuses are only paid to board members or very few people, the median figure indicates the reality in the middle of an organisation.

The government also requires a written statement.  Guidance produced jointly by Acas and the Government Equalities Office (‘GEO’), Managing gender pay reporting, reiterates the requirement that the statement confirms the information is correct.  It also recommends a supporting narrative, explaining any apparent gender pay gap and what measures are being taken to address the gap.

Where must the report be submitted?

The completed report must be submitted to the government’s website, Report your gender pay gap data, and published on the organisation's own website. As at 9 January 2018, 546 employers had registered their gender pay gap data.

Failure to comply with the reporting requirements

There are no enforcement provisions within the GPG Regulations for failing to report.  The Equality and Human Rights Commission (‘EHRC’) has published a draft policy for consultation setting out its proposed approach.  Responses are required by 2 February 2018.  The draft policy says: We aim to promote compliance without the need for formal enforcement action. However, we will take action in accordance with our powers set out in the EA 2006 where employers do not comply, despite our encouragement to do so. Formal action could include an investigation under section 20 of the Equality Act 2010 followed by the issue of a section 21 notice of an unlawful act.  We will let you know more once the approach is finalised. 

Benefits to businesses

There have been some high profile cases evidencing the fallout from the regulations, but Acas and the GEO emphasise that the intended aim is to encourage gender diversity and equality, allowing employers to help staff to reach their full potential and so lead to greater productivity and increased financial returns. It is also likely, for example, that prospective employees, for example, will review the published data when considering whether to apply or accept an offer of employment. 

If you believe you may fall within the reporting requirements and require assistance please contact Julie Temple or Marsha Robinson, who are specialist employment law solicitors at Quantrills with particular expertise on the GDP Regulations. Also, you can purchase and access a pre-recorded webinar at any time.

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