The gender pay gap is an equality measure that shows the difference in average earnings between women and men.
Currently the UK gender pay gap is at its lowest level ever at just over 18 per cent. Whilst it is great to see that this figure is dropping has it dropped enough?
Why do we have a gender pay gap?
There are many reasons for the pay gap – many of which are complex and overlap each other.
A high proportion of women tend to choose to work in the lower paid sectors, ones which offer less financial reward. This can be for many reasons but often it is to do with the fact that they are looking after families and the lower paid jobs are often the ones that are part time or flexible therefore making it easier to juggle family life.
Contrary to this many of the higher paid sectors seem to be made up disproportionately of men.
The new gender pay gap reporting regulations require businesses with more than 250 employees to calculate and publish the pay gap between male and female employees.
The regulations apply to private and voluntary sector employers in England, Wales and Scotland – the first mandatory reporting will be April 5th 2017.
How could this affect my company?
If your company has more than 250 employees, then you will be required this April to publish your gender pay gap data and a written statement on your public facing web-site.
You will also need to report the data to government online – a service that will be available on the government website from spring 2017.
Figures will need to be kept for 3 years to enable comparisons to be made.
The following data is required;
- mean gender pay gap in hourly pay
- median gender pay gap in hourly pay
- mean bonus gender pay gap
- median bonus gender pay gap
- proportion of males and females receiving a bonus payment
- proportion of males and females in each pay quartile
Pay includes basic salary, paid leave, maternity pay, sick pay, shift premiums, allowances and bonus pay. It does not include overtime pay, expenses or benefits in kind. Employers will need to work out each employee’s hourly rate in order to create comparable statistics.
If there is a disparity between the pay awarded to men and women, then you are opening yourself up to the possibility of a discrimination claim at Tribunal.
Do I need to do anything now?
We recommend that you start compiling your data now. For many companies, the required information will not be readily available and will need to be prepared well in advance of the reporting deadline.
How can I avoid an issue?
Simple. Ensure that all of your employees are paid fairly regardless of their gender. If your company has less than 250 employees you can still complete the exercise in order to establish your current position.
Actions can then be taken to address any disparity before a time where is may be mandatory for smaller companies to also publish the gender pay gap data.
If you are unsure as to whether you are still at risk then please don’t hesitate to get in touch with us. We can help you to identify whether you are adhering to current regulations and put in place legally compliant contracts and systems to minimise the risk to your business.
We will agree a fixed cost for this work with you, depending on how much we need to do. In some cases we can offer you free guidance. For our Watertight HR & Legal clients some of this work may be included in your fees so please ask. If you are not a Watertight client and would like a quote contact us on firstname.lastname@example.org or 0114 3032300.