New guidance on gender pay gap reporting 2021

Gender pay gap reporting has been making headlines in the past couple of months due to the uncertainty around whether it would be suspended in 2021 and, if not, how exactly employers should take the coronavirus into consideration in their calculations.

Since we last reported on gender pay gap reporting, further updates have been released as the Government has now confirmed that eligible employers will need to produce a report by 4 April 2021.

Government guidance goes on to say that for employers’ 2021 reports, they should:

  • focus on the ‘snapshot’ date of 5 April 2020 in the private sector
  • focus on the ‘snapshot’ date of 31 March 2020 in the public sector
  • take furloughed staff into account when considering whether their business meets the requirement of having at least 250 staff on the snapshot date and is expected to produce a report
  • not include employees in the ‘reporting pool’ if they were not on full pay on the ‘snapshot’ date – meaning that any member of staff who was furloughed, and who did not have their pay topped up to 100%, can be discounted from the report for the purposes of hourly pay calculations
  • include furloughed staff in any calculations relating to bonus pay, regardless of whether their salary was “topped up” to 100% or not.

In other related news

Gender pay gap has been found to increase with age.

The gender pay gap between men and women working full time is at its widest for those over 50. Analysis of pay data from the Office for National Statistics (ONS) has found that the median annual salary of women working full time in their 50s was 23% less than the median full time salary of men in the same age group, with women in their 60s earning 25% less.

The median annual salary of a female full-time employee in 2020 was £27,981 compared with £33,923 for men – a difference of £5,942 and representing 18% less.

According to the analysis, both women and men reach their peak earnings during their 40s when their median annual incomes were £31,403 and £38,829 respectively – equating to a gap of £7,426. This means that women were taking home an annual salary which was nearly one fifth (19%) less than men.

As a result of this, employers may now seek to address these issues within their own companies, especially as gender pay gap reporting looms for qualifying employers. In this upcoming report, not only will the impact of coronavirus need to be addressed, but employers may want to think about paying closer attention to any age discrimination that may derive from gender-based pay gaps.

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