Unsure about what gender pay gap reporting means for you?
Date: Thursday 12th May 2016
By Caroline Griffiths, Managing Director
Gender pay gap reporting comes into force on 1st October 2016. Gender pay gap is the difference in percentage between what men and women are paid within an organisation. In the UK, the deficit sits at around 19.2% which means that for every £1 men are paid, women are paid 80p. Recent estimations reveal that it would take 47 years to narrow the gap at current rates of progress.
There have been many explanations put forward for the difference in pay between men and women mainly due to organisational and societal reasons. These include the education of girls and the lack of encouragement to undertake science and maths based subjects; job choice – females tend to choose roles that are in less well paid sectors; maternity and absence leave; flexible working – 43% of women work part time in comparison to just 12% of men.
The new legislation was put forward by the Coalition Government as a catalyst for change to encourage organisations to be transparent about their pay structures and to identify the discrepancies between pay for men and women. Other initiatives have been prevalent in the media including the Lord Davies review of women on boards as well as ‘Think, Act, Report’, whereby organisations of all sizes were asked to report on gender equality in the workplace.
Draft regulations have recently been drawn up about what needs to be reported and how it should be reported. So if you are unsure about what these mean for your organisation then we have a few key pointers to help you.
- Gender pay gap reporting applies only to UK based companies with 250+ employees both full and part time (subsidiaries must be counted separately and not as part of the wider group).
- Data must be gathered as at 30th April 2017 and published within 12 months and then each anniversary after.
- Employers will have to report on mean pay, median pay and mean bonus payment between male and female employees.
- Organisations must make their data internally and publicly accessible on their website as well as on the dedicated Government website. Data must be in English and signed as accurate by a Director and retained on the company website for three years.
- Data from organisations is expected to be published in league tables by sector – ‘naming and shaming’ those organisations who have particularly high percentage gaps.
- It is recommended that a narrative is provided to explain results and methodology.
- At the moment, the data does not have to be drilled down in to, to investigate the differences and gaps between more junior and senior roles.
- It is not compulsory to present this data and no fines will be imposed at this stage, but this could well be introduced over the coming years.
At this stage only draft regulations have been drawn up with final regulations confirmed later on the year, so some things may change.
The Chartered Institute of Personnel and Development (CIPD) published a report recently which said that employee engagement was at a low. Although some organisations may see this initiative as a way of being beaten with a stick, in organisations currently undertaking this style of reporting for example PwC, they have found the opposite whereby employees have become more engaged with the organisation as the workforce is interested to see how they will respond to the results.
If you’d like to find out more about gender pay gap reporting then please call us to find out more on 0207 977 9200 or alternatively drop us an email email@example.com.