Gender pay gap reporting – what do you need to do?
Section 78 of the Equality Act 2010 provides the Government with the power to introduce regulations requiring employers to publish information relating to the pay of employees for the purposes of showing whether there are differences in the pay of male and female employees.
The Government has recently published its consultation and produced draft Regulations to implement mandatory gender pay gap reporting. Sejal Raja considers the implications for employers.
Who does it affect?
The Regulations, if implemented, will apply to organisations in England, Wales and Scotland, who employ at least 250 employees.
When will it come into force?
Subject to the outcome of the consultation and approval of Parliament, it is likely that the Regulations commencement date will be 1 October 2016, although employers will not be expected to publish the required information immediately.
The Government has suggested that employers will have 18 months from the commencement date to publish the required information and thereafter the employer must publish the information annually.
What information has to be published?
The draft Regulations suggest that the following information will need to be published by employees:
- The different in mean pay between male and female employees
- The difference in median pay between male and female employees
- The difference in mean bonus pay between male and female employees
The draft Regulations define pay as including basic pay, paid leave, maternity pay, sick pay, area allowances, shift premium pay, bonus pay. It does not include overtime pay, expenses and the value of salary sacrifice schemes, benefits in kind, redundancy pay, arrears of pay and tax credits.
Where do employers have to publish this information?
The draft Regulations provide that employers must publish this information on their UK websites that is accessible to employees and the public. Employers are required to retain this information on line for three years.
What happens if employers do not comply with these Regulations?
There are no civil or criminal sanctions attached to these draft Regulations, although sanctions may be introduced at a later date. The government has however stated that it will publish league tables, which could have the effect of naming and shaming employers.
Despite this, employers should nevertheless comply with the Regulations as disgruntled employees who have concerns about the level of pay could draw the failure of the employer to publish the information to the Employment Tribunal’s attention in any proceedings.
It is highly likely that the draft Regulations will be implemented later this year. Accordingly, employers who have more than 250 employees should start considering how it will collect the data to meet the requirements of the government’s gender pay reporting.
If you have any questions then please contact Sejal Raja on firstname.lastname@example.org.
This briefing is for guidance purposes only. RadcliffesLeBrasseur LLP accepts no responsibility or liability whatsoever for any action taken or not taken in relation to this note and recommends that appropriate legal advice be taken having regard to a client's own particular circumstances.