Earlier this month, Boris Johnson announced a new tax rise to fund the Government’s long-awaited plan for health and social care. The Health and Social Care…
From 2017, any organisation that has 250 or more employees must publish and report specific figures about their gender pay gap.
The gender pay gap is the difference between the average earnings of men and women, expressed relative to men’s earnings. For example, ‘women earn 15% less than men per hour’.
Employers must both:
- Publish their gender pay gap data and a written statement on their public-facing website
- Report their data to government online – using the gender pay gap reporting service.
If your business has fewer than 250 employees, it can publish and report voluntarily but is not obliged to do so.
When you must publish and report
The figures must be calculated using a specific reference date – this is called the ‘snapshot date’. The snapshot date each year is:
- 31 March for public sector organisations
- 5 April for businesses and charities
Organisations must publish within a year of the snapshot date. Businesses and charities must publish by 4 April each year – the deadline for the first report is 4 April 2018. Public sector organisations must publish by 30 March each year.
Your organisation will be a ‘relevant employer’ and must publish and report if it has 250 or more employees who are based in England, Scotland or Wales.
The legal entity that is the ‘relevant employer’ (e.g., the company, partnership or LLP) must register with and report to the gender pay gap reporting service.
If you are a ‘relevant employer’ and run multiple payrolls (for example payrolls for different departments or business functions), you must merge relevant data from all your payrolls and report one set of figures for your organisation.
The Government has provided comprehensive guidance on the requirement to report, and how to do so.
Private sector group structures
Private sector organisations that are part of a group must report individually if they are ‘relevant employers’. Additionally, corporate groups can voluntarily report combined figures for the entire group.
Who counts as an ‘employee’
The definition of ‘employee’ for gender pay gap reporting includes:
- people who have a contract of employment with your organisation
- workers and agency workers (those with a contract to do work or provide services)
- some self-employed people (where they must personally perform the work)
When to count agency workers and self-employed people in your organisation
If your organisation uses agency workers or service companies, they count as part of the headcount of the agency or service company that provides them – not your organisation.
You must include self-employed people in your organisation’s calculations if they must personally perform work for you and you have the data available, for example, where a project initiation document exists or a schedule of fees is in place.
Part-time workers and job-sharing
You must count each part-time worker as one employee for gender pay gap reporting purposes.
If you use job-share arrangements, every employee within a job-share counts as one employee. So, if two people job-share, they count as two employees for gender pay gap reporting purposes.
When employees have more than one job within your organisation, you can either choose to count them according to how many employment contracts they have or as one employee. Your organisation can choose the most appropriate approach – but it will help the accuracy of your figures if you consistently apply what you decide.
Overseas workers and international jobs
As a general rule, you must count an employee based overseas if they have an employment contract subject to English, Scottish or Welsh law.
Partners in partnerships
Partners in traditional partnerships and members of LLPs will not be included in the calculations. This is because partners take a share of the partnership’s profits, which is not considered directly comparable with employees’ pay.
Data you must publish and report
You must publish the following data on your public-facing website and report to the Government, your organisation’s:
- 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
You’ll need to:
- gather specific information from your payroll
- use this information to make your calculations
- publish a written statement on your organisation’s website which confirms the accuracy of your calculations
You must publish and report your figures if you’re a ‘relevant employer’. The Equality and Human Rights Commission can enforce any failure to comply with the regulations.
Support is also available to manage and improve your business’s gender pay gap
Advice on managing your organisation’s gender pay gap from the Advisory, Conciliation and Arbitration Service (ACAS) website.
The one thing you cannot do, if you have more than 250 employees (calculated as shown above), is ignore these requirements.
Although the legislation is clear that – currently – partners’ pay gap details should not be reported, there have been news articles claiming that the Government is unhappy with this in connection with large law firms and accountancy practices. It may be that the rules will be revised for the 2018 report, to require the inclusion of partners’ information.