Have you reported your gender pay gap?
In February the government announced that the deadline for gender pay gap reporting for the year 2020/2021 would be postponed for six months due to the ongoing effects of the COVID pandemic. While many may have pushed it to the back of their mind, 5 October 2021 was the date that businesses with over 250 employees had to report their figures by, in order to avoid potential enforcement action by the Equality and Human Rights Commission (EHRC).
All private and voluntary sector organisations with over 250 employees must have reported their figures based on the snapshot date of 5 April 2020, both on their own website where they must remain for at least three years, and through the government’s gender pay gap reporting website. Employers who have taken advantage of the Coronavirus Job Retention Scheme during the pandemic should have ensured that those employees on furlough at the relevant date were also counted when determining whether they meet the threshold for reporting.
Employers had the option of publishing a narrative which can be a useful tool in explaining their gender pay gap, as well as setting out how they intend to reduce this going forwards in an action plan. Whilst neither are mandatory, employers will want to consider the benefits of having the opportunity to explain the reasons behind their gender pay gap, as well as demonstrating their commitment to equality in the workplace.
What if you missed the deadline?
Where an employer fails to report its gender pay gap, the EHRC has the power to investigate and may apply for a court order requiring an organisation to take remedial action. If steps are not taken to comply, an employer may be subject to a potentially unlimited fine. Notwithstanding the impact of any financial penalties, employers should also be aware of the reputational damage if they fail to comply, or their figures demonstrate a significant gender pay gap.
It has recently been reported that job vacancies are at a record high of over one million, and many job seekers will look at an organisation’s commitment to equality when deciding where to apply for roles. A survey carried out by the EHRC in October 2018 found that nearly two thirds of women would consider an organisation’s gender pay gap when applying for jobs, and half of the women surveyed said that a gender pay gap would reduce their motivation and commitment to their current employer.
It is clear the COVID pandemic has had a disproportionate impact on women, both in terms of job losses and caring responsibilities, and this has highlighted the ongoing disparity in pay between men and women. Steps that an employer could consider taking to try and address gender inequality in the workplace may include anonymising CVs and applications, promoting job share arrangements, and offering mentoring opportunities to support women in their career aspirations. Pay transparency, including publishing pay scales, can also assist in reducing an organisation’s gender pay gap and may also result in happier and more productive employees.
The Government has issued guidance on gender pay gap reporting, which is available here.
To speak to us about your employment issues, whether to do with strategic business decisions or a particular issue involving an employee, get in touch with Emma Pitfield or another member of our Employment Law team on 0330 311 1950.