Further details on the requirement on large employers to publish gender pay gap data have been issued, giving employers a much clearer picture of what will be needed. The requirement will apply only to those employers with 250 or more employees.
Importantly, the date of implementation has been delayed until October 2016. However, no data will actually need to be published until 30th April 2018 at the latest. Here is the timeline:
Legislation introduced: October 2016
‘Snapshot’ of pay information to be taken on: 30th April 2017
Analysis of information permitted for 12 months
Data to be published by: 30th April 2018
The date of 30th April 2017 is very important – data taken as of this date of pay earned by males and females is the data that must be analysed and reported on. Employers will then have a maximum of a year to report on this data, though early reporting is permissible.
Employers will need to produce two figures – a ‘median’ and a ‘mean’. The ‘mean’ is the average, and the ‘median’ is the figure in the middle when all pay data is placed in numerical order. The data has to be reported in the form of a percentage representing how much female employees earn in comparison to their male counterparts. The percentage for calculating the mean figure must be calculated using the following statutory formula:
(A – B) x100
Where A is the mean gross hourly rate of pay of all male employees employed on 30th April 2017 and then annually on that date for future calculations; and
B is the mean gross hourly rate of pay of all female employees employed on 30th April 2017 and then annually on that date for future calculations.
Similar formulas apply for the median figure and for data relating to bonuses received, which must also be reported on.
In addition to the above calculations, employers will need to split all their workers’ salaries into four bands and publish the number of male and female employees in each band. These bands are called ‘salary quartiles’ and it is for employers to decide on the exact division. For example an employer may think salary quartiles of £0 - £20,000; £20,001 - £40,000; £40,001 - £60,000; and £60,001 and above will cover their salary spread appropriately.
Employers may voluntarily provide a narrative text to explain any gaps in the report and action taken to resolve them.
The report will need to be published on a UK website which is accessible to the employees and the public.
Although it is not expected that there will be any further changes, the above information still requires final confirmation which is expected in the coming months.