Gender pay gap reporting: next steps
Most employers breathed a sigh of relief when they uploaded their data to the government’s website before the deadline date passed. Publishing the report, however, will not be the end of this issue for employers as increased awareness, public focus and ongoing reporting requirements will keep this area alive. Enforcement action will commence Although over 10,000 employers met the deadlines, it is estimated 1,500 employers failed to publish their report on time or at all. The Equality and Human Rights Commission (EHRC) have written letters to these employers, giving them a further period of 28 days to produce a report or face enforcement action. Employers who continue to fail to produce a report will be investigated by the EHRC to determine whether they have committed an ‘unlawful act’ i.e. a breach of the gender pay gap regulations. The penalties include summary conviction and unlimited fines. Collecting data for 2018’s report The requirement to report the gender pay gap is an annual one so long as the employer has 250 or more employees on the 5th April each year, or 30th March for public sector organisations, using the extended definition of employee. Fluctuation of staffing numbers could see some organisations fall out of the reporting requirement, or reach the reporting threshold even though they haven’t previously been required to report. Pay data will have to be pulled from payroll systems on these dates which is then used to work out the required calculations before the deadline in 2019. Taking proactive steps Employers who used the voluntary narrative to explain they would take action to reduce the gap, or where their calculations showed a significant gap, can now start taking proactive steps to address the gap within their business. These steps may include: reviewing the recruitment process; carrying out an equal pay audit; creating transparent salary frameworks; introducing training schemes; and providing training on discrimination and unconscious bias to decision-makers. Answer queries from employees The pay data is available online to anyone who chooses to access it and this includes current employees. It is likely that employees will start asking questions around the pay gap data, including what it means for them and how their salaries are effected. These queries should not be pushed to one side as they could escalate to formal grievances and, in some cases, tribunal claims. Instead, employers can hold a meeting with the employee to discuss their pay, either ad-hoc or as part of their formal appraisal and performance reviews, and can consider sending information about their gender pay gap to the entire workforce. Be aware of future reporting requirements The buzz around gender pay data has led to calls for pay transparency to be increased, with ethnicity pay gap reporting at the top of the list. The government has tasked the charity Business in the Community with assessing whether companies are voluntarily carrying out ethnicity pay audits. In addition, there are also pressure groups who are campaigning for the gender pay gap reporting threshold to be set lower than 250 employees, with some agreeing that 50 employees is an appropriate threshold. For now, employers should stay up-to-date with updates in this area to ensure they are meeting their reporting requirements.