Gender pay gap reporting 2021
The gender pay gap, the difference in the average earnings between men and women, has been a major cause for concern for many decades. Usually felt by women, and whilst it is showing signs of closing, the gap remains a symbol of inequality between the sexes. This is why employers are legally required, by the Equality Act 2010, to provide equal pay to both men and women if the work they do is the same or broadly similar; thus paying them a different rate because of their gender is unlawful.
In April 2017, the difference between earnings for full time male and female employees, calculated on a median hourly basis, was 9.1%. In an attempt to address this, the Government introduced an obligation on employers to publish data on the salary of their male and female employees. Specifically, employers need to highlight any pay gaps that may exist between the sexes. This obligation exists in the form of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 which took effect from 6 April 2017 and requires employers with at least 250 members of staff to take a ‘snapshot’ of their gender pay data annually.
Due to the coronavirus outbreak, the Government Equalities Office (GEO) and the Equality and Human Rights Commission (EHRC) suspended enforcement of the gender pay gap deadlines for 2019/20, meaning there was no expectation on employers to report their data. However, gender pay gap reporting is expected to make a comeback this year 2021 - but how will it work? Well, ultimately, the law will work in the same way as it has done previously, but the impact of the coronavirus will be felt. The ‘snapshot’ date that employers in the private sector will need to focus on is 5 April 2020, which came just after the first national lockdown was implemented and the Job Retention Scheme had first been rolled out UK-wide.
Normal rules on producing a report dictate that employees do not need to be included in the ‘reporting pool’ if they were not on full pay on the ‘snapshot’ date. This means 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. The knock-on effect of this may see the reporting pool significantly reduced meaning that the results it produces may therefore show an increase, or decrease, in the gap that is not representative of reality. With this in mind, it is crucial that any report produced by employers is combined with a detailed explanation of the figures – if there is a substantial change, they should explain that this is as a result of the number of staff on furlough and/or the redundancies they have had to make due to coronavirus.
Another key issue to bear in mind is the need to have a least 250 members of staff in producing a report. Employers may have reduced their staffing numbers throughout 2020 and may therefore believe that they are no longer required to produce a report. However, it should be noted that the key date is 5 April 2020. If on that date they met the criteria to produce a report, they should do so. Again, a staffing reduction may have an impact on the report, so this should also be clearly explained.