Increased transparency has revealed challenging truths about gender pay

The deadline for the first gender pay gap reports is here. By midnight tonight all companies which employ 250 or more are required to publish information for the payroll period including the snapshot date of 6 April 2017. Information on any bonuses paid also needs to be published at the same time for the 12 month period ending April 2017. There is no obligation for companies to explain the gender pay gap, nor any duty to address it if a company is complying with the Equality Act however, as we have seen with the BBC, there can be huge fallout and potential reputational damage where a large gap is shown with no explanation. Furthermore, the best candidates may not be attracted to working for companies with a big gender pay gap if they feel that their gender will adversely impact their career prospects.

All companies with more than 250 employees are obliged to publish:

  1. The difference between the mean hourly rate of pay for male full-pay relevant employees and that of female full-pay relevant employees
  2. The difference between the median hourly rate of pay for male full-pay relevant employees and that of female full-pay relevant employees
  3. The difference between the mean bonus pay paid to male relevant employees and that paid to female relevant employees
  4. The difference between the median bonus pay paid to male relevant employees and that paid to female relevant employees
  5. The proportions of male and female relevant employees who were paid bonus pay
  6. The proportions of male and female full-pay relevant employees in the lower, lower middle, upper middle and upper quartile pay bands

 

Peter Cheese, Chief Executive of the CIPD, the professional body for HR and people development comments:

“Gender pay gap reporting was dismissed by some as a blunt instrument of compliance. But as more and more results have been published we have seen that it is revealing some challenging truths about where the real issues lie in achieving sustainable change.

“We need to use the data to give us greater clarity on the courses of action we all need to take to make a real shift on this long standing business and societal agenda. It’s vital that organisations continue to develop this narrative, and hold themselves to account in the years ahead. There are many actions we can take now, such as providing more flexible working roles and opportunities, and ensuring recruitment, development and promotion processes are truly unbiased and inclusive.

“It is often said that sunlight is the best disinfectant. The increased transparency that gender pay reporting has brought has further fuelled the debate about how we’re supporting different groups in society towards fulfilling, fair, and rewarding opportunities and work for all.”

Emma O’Leary is an employment law consultant for the ELAS Group. She says:

“There are still approximately over 100 firms who are still to publish their data today. Those that have reported so far have revealed overwhelming gender pay gaps.  However, as headline grabbing as that seems at first, it demonstrates the importance of companies publishing a report to go alongside the data which, in some cases, does explain why there might be a gap and could go some way towards watering down the initial shock of the statistics.  With all that being said, the very clear theme we’re seeing here is that the gender pay gap does exist and there is still work that needs to be done in order to eradicate this antiquated inequality.

“It will be interesting to see if those companies who still have to submit their reports will actually do so, or they just won’t comply and rely on the fact that no statutory repercussions have actually been built in to the legislation.  Despite the Equality and Human Rights Commission threatening to “fully enforce” the requirement to publish reports with unlimited fines for companies who fail to do so, they currently have no legislative power to do this. Right now, the only risk to companies who fail to publish their reports is the headlines which will inevitably come tomorrow.”

If you are interested in diversity and inclusion or finding out more about transforming your company culture to be more diverse and inclusive you may be interested in our Diversity and Inclusion Conference 2018 held in London on the 19th April. Click here for more details.


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