R.E.S.P.E.C.T – Will gender pay reporting have an impact?
Following the introduction last year of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, the deadline for employers publishing their first set of reports is fast approaching.
Do the reporting rules apply to my business?
As a brief recap, the Regulations require all private employers with 250 or more employees (calculated as at 5th of April 2017) to publish certain pieces of information regarding the gender pay gap. The published reports must be lodged no later than the 4th of April 2018 (and annually thereafter).
What must be reported?
The report must address:-
• The overall difference in mean and median gross hourly rates of pay between male and female full pay relevant employees in the pay period (the pay period is whatever method the employees are paid – e.g. weekly or monthly);
• The difference in mean and median bonus payments made to male and female relevant employees during the 12 months prior to the 5th of April each year
• The proportion of male and female relevant employees who received bonus payments in the 12 month period;
• The proportion of male and female full-pay relevant employees working across salary quartiles.
Are there sanctions for not reporting?
No. There are no formal sanctions under the Equality Act although it is thought that the Equality and Human Rights Commission will be monitoring those employers who don’t comply. In the sense that there are no sanctions for non-compliance, the regulations are somewhat toothless. With less than 3 months to go until the first reporting deadline, of the 9000 odd employers who should be reporting, those who have complied are in in the minority. Many have suggested that the risk of reputational damage will be a driving force in prompting employers to comply. Whether that so remains to be seen.
I noted from a recent report that Easyjet, Virgin Money and Ladbrokes had all recently reported. These reports demonstrated that women were paid on average 52%, 33% and 15% less per hour than men, respectively. Am I less likely to fly with Easyjet because of these stats? No. I am a Scotsman – I will fly with whoever is cheapest. I asked my mother the same question and her answer was the same as mine.
Although the gender pay gap is not the same as equal pay, the two are clearly linked. As an example, an employer might have a very large gender pay gap but would not necessarily be infringing equal pay laws. Equally, an employer might have no gender pay gap but could still have individual cases infringing equal pay. Remember that the publishable figures are mean and median. That said, it is highly likely that the reporting obligations will result in further equal pay claims.
Recent high profile reports
Only last week we saw the BBC reporter Carrie Gracie resign from her post amidst concerns that male comparators doing the same or similar jobs were being paid far more than her. Her £135k per annum could be contrasted with male reporters earning up to £249k. Late last year there were further reports showing disparity within the BBC – for example Gary Lineker’s earnings of £1.8 million against Clare Balding’s £200k. Or in the news room, Hugh Edwards’ £600k to Fiona Bruce’s £400k. Even as far afield as Hollywood there are reports alleging Mark Wahlberg getting £1.1million for a re-shoot against Michelle Williams’ $80 per day (totalling less than $1,000).
In no way criticising Ms Gracie’s courageous move but I would imagine that, at least from a financial standpoint, it is easier to jack in a £135k job than, say, a woman earning £8 per hour in a supermarket. It would be nice to think that the more woman who make a stance like Ms Gracie, the more will have to be done to address (un)equal pay.
Given the magnitude of the issue, it is clear that the reporting obligations will not be a quick fix. They might not even be a fix at all and doubtless many woman will need to rely on employment tribunals to grant equality.
If you have not applied your mind to gender pay reporting – do so now.
If you are not sure what to report – take advice.
If you are worried that your figures will show a disparity – you can utilise narratives on the report to explain further and details measures you propose taking to explain.
For more information on gender pay reporting please contact the Blackadders Employment Team.