The General Data Protection Regulations (GDPR) deadline of 25 May 2018 has many in a frenzy. However, under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, private and voluntary sector organisations with over 250 employees will have completed or be working towards the Gender Pay Gap Regulations (GPGR) reporting deadline of 4 April 2018.
This month it was reported that the pay gap between male and female managers is worsening with women earning an average £12,000 less than their male colleagues, a figure a lot higher than earlier data may have suggested. How incredible then that according to the Chartered Institute of Management only 77 of 7,850 organisations have complied with their gender pay gap obligations ahead of the April deadline. How incredible too that the same financial sanctions of the GDPR were not applied for failure to report gender pay gaps particularly when pay, equality and fairness may be impacted.
Let’s be clear though that even if an organisation has a high gender pay gap this does not necessarily mean that there is an equal pay issue. Similarly, there may be an equal pay issue within an organisation but the gender pay gap figures may be minimal.
In our experience, organisations tend not to intentionally discriminate on pay between the genders but can, over time, sometimes unintentionally discriminate resulting in a higher male or higher female pay. This may be for a variety of reasons such as: males negotiating better pay than females at interview or salary review time (as evidenced by a wealth of research on this topic); the type of sector; the type of role; the country and/or a pay structure based on length of service. However, by going through the process of analysing and measuring often highlights to organisations anomalies within their pay structure and creates actions that may have been missed. By internally and externally reporting the gender pay gap figures improve transparency.
Even if you are an employer of under 250 employees you may have decided that for good practice it is important to assess the median and mean difference between male and female pay. You may also decide that as part of your equality, diversity and inclusion strategy you would like to know the differences in pay in each quartile and, variances in bonuses. For procurement purposes there may be a keener interest in compliance with the GPGR.
In summary, the steps the GPGR require organisations to take are as follows:
- Calculate the proportion of males and females when divided into four groups ordered from lowest to highest pay.
- Calculate their average gender pay gap as a mean average.
- Calculate their average gender pay gap as a median average.
- If applicable, calculate their average bonus gender pay gap as a mean average.
- If applicable, calculate their average bonus gender pay gap as a median average.
- If applicable, calculate the proportion of males receiving a bonus payment and proportion of females receiving a bonus payment.
- Report their Gender Pay Gap on the government website and internal website by 4 April 2018.
- Where applicable, the Gender Pay Gap report confirmed in a written statement by an appropriate person, such as a chief executive.
In terms of good practice it may be wise to create an action plan and also, communicate a narrative to accompany the reported figures.
If you have any questions on any of the issues raised in the above article please contact Stephanie Harper.