Guest post by berg, a law firm that works closely with companies to navigate the potentially tricky post-gender pay gap reporting period.
As part of an ongoing effort to tackle to UK’s gender pay gap, the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 will come into force in April this year. Businesses with 250 employees or more will have to report on the wage gap, which currently stands at a national average of 9.4% for full-time work, and 18.1% for full- and part-time work combined.
With estimates coming in at between 50 years and 170 years as to when the wage gap will close fully, employers are under pressure to promote transparency in pay discrepancies, and offer solutions that prove their dedication to improving equal pay for equal work.
The Act, which comes into effect on 6th April 2017, will require larger businesses to calculate and publish data about their gender pay gap. Making this information public will take time and could have a lasting impact on your business. The same applies for working to resolve any discrepancies.
With that in mind, we’ve looked at how to prepare for the deadline, what information will be required, and the steps to take following the publication in order to minimise any potential damage that could be caused by negative figures.
Who will be required to disclose information?
All voluntary and private-sector employers with 250 employees or more will be required to publish gender pay gap data under the new legislation.
What information needs to be published?
Qualifying business will need to provide…
- The average gender pay gap
- The average gender bonus gap – including commission
- The proportion of male and female employees receiving bonuses
- The proportion of male and female employees in each pay bracket
Mean and median averages must be calculated, and will be published on the Government website. In addition, employers should make the data accessible on their own websites.
Each company’s results will need to be accompanied by a written statement from an appropriate senior, such as a director or Chief Executive, confirming the accuracy of the calculations.
How will you present the data?
At present, the legislation only requires employers to release the figures; however, though not compulsory to provide explanation, it may be in your business’s best interests to offer commentary.
An in-depth discussion of your results will allow you to provide context, outlining why some employees may have earned more. You’ll also be able to draw attention to successes, highlighting areas where previous measures have decreased the pay gap, for example.
Should you see a clear gap between the average pay of your male and female employees, it is important to address this and suggest changes that you will implement to rectify it. In this case, you should prepare a response – in case of needing to address press – and make employees aware of the results prior to releasing them to the public.
Making your employees aware of upcoming changes will show your commitment to working towards a fairer workplace that is dedicated to delivering equal pay for equal work.
What impact will gender pay gap reporting have on your business?
At present, reporting a large gender pay gap will not directly result in legal consequences, because the new legislation’s purpose is to encourage transparency and action, rather than finger-pointing. However, failure to release the required information could result in further investigation from the Equality and Human Rights Commission. An unwillingness to disclose this information may also cause distrust from employees and the public.
If reporting on your business’s gender pay gap reveals unflattering figures, you should use this as an opportunity to openly address the issue, and to demonstrate that you are committed to change and support equality in the workplace.
To find out more about the requirements and implications this new legislation, watch berg’s Gender Pay Gap reporting webinar, in which HR Specialist and Head of Employment, Michelle Gray, shares further advice on the following:
- What the regulations will be and how they will impact your business
- How to prepare for the regulations
- How to interpret and apply the regulations
- How to protect against claims and manage risks