Gender Pay Reporting: next steps and more detail

The Government issued today more details in the form of a second consultation on how and when large employers (250 or more employees) must report on their Gender Pay Gap publicly. The reporting will be mandatory and we will be responding on behalf of clients to the short further consultation next month. It should not be confused with the Think, Act, Report initiative which has also received publicity this week.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498743/Trailblazing_Transparency_-_Mending_the_Gap_report_Feb_2016.pdf

Key time frames

• A short further consultation – today’s paper requires responses by 11  March 2016
• The Regulations setting out the Reporting obligations will be implemented 1 October 2016
• The first reporting cycle (by which a report is required to be published) will be 18 months from implementation – so employers need to prepare to report in April 2018
• Annual reporting will be required thereafter

Key points – what more detail do we have? What, where, when? 

The Government has confirmed that when calculating the 250 employees’ threshold, only those who ordinarily work in Great Britain count.

Pay for these purposes will cover basic pay, leave, premia (such as shift payments, London and other allowances) and, importantly, bonuses. Benefits in kind, the value of salary sacrifice schemes and overtime pay are excluded.
Both mean and median pay gaps will have to be produced and an hourly pay rate per employee will be needed to get to the mean and median.

The workforce profile must also be published: the distribution between men and women in each salary quartile at the employer.

All of this data will have to be on the employer’s website – accessible to its own workforce and the public. It must also be certified as true by a director or member in an LLP or senior office in other voluntary employers, for example charities or not for profit entities.

There will also be a government maintained website on which the information will have to be uploaded.

Bonuses

The fact bonuses were included, came out after the first consultation exercise. Bonus is now defined widely.

The draft Regulations state that when calculating the gender bonus gap, only those in receipt of a bonus are included and employers will have to publish the proportion of men and women receiving a bonus. 

Questions to address in this further the Consultation 

• The draft Regulations attached to today’s consultation paper do not, however, address or define employees – (contract of services or for services, nor draw any distinction between permanent and temporary staff).
• The definition of employer is the legal entity – rather than by establishment – and given that location allowances are included, indicate that the employer’s workforce as a whole in Great Britain must be included in the calculations.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/499972/MGPGReportingConsultation.pdf

Audrey Williams
AMWilliams@foxwilliams.com