A recent Private Members’ Bill, the Irish Human Rights and Equality Commission (Gender Pay Gap) Information Bill 2017, sought to introduce gender pay gap reporting in Ireland. This Bill proposed to require employers over a certain size to publish information relating to employee pay, for the purpose of showing whether there are differences in the pay of male and female workers and, if so, the nature and scale of such differences.
However, this Bill seems to have been a false start for gender pay gap reporting in Ireland as just before the summer break, the Government published the general scheme for a different Bill, the Gender Pay Gap Information Bill 2018 (the “General Scheme”). As the functions set out by the Scheme are the same as the 2017 Bill i.e., the introduction of gender pay gap reporting, the previous 2017 Bill may now be rendered obsolete.
CURRENT SITUATION UNDER IRISH LAW
As it stands, no gender pay gap reporting obligations exist for Irish employers.The only relevant legal protections in this area are the equal pay provisions of the Employment Equality Acts 1988 – 2015. These Acts provide employees with a cause of action if they can show that there is a person of the opposite sex in the same employment working for the same (or an associated) employer doing ‘like work’ and being paid more.
Anecdotally, it seems that equal pay claims do not arise very frequently in the Workplace Relations Commission. One could speculate that this is due to several factors. However, the requirement that an employee in this scenario would be able to point to an actual real-life comparator of the opposite sex who is performing ‘like work’ for higher pay necessarily presents an obstacle for potential claimants. In addition, employers have a defence to an equal pay claim under the Acts if they can demonstrate that the grounds for unequal pay are not related to any of the protected characteristics under the Acts.
PROPOSED LEGISLATION ON GENDER PAY GAP REPORTING
The General Scheme does not indicate what the reporting obligations will look like, and instead confers power on the Minister for Justice and Equality to introduce regulations in this regard.
The General Scheme indicates that reporting will be confined to a maximum of once per year.
The General Scheme proposes that both public and private sector employers will be subject to these obligations.The reporting obligations will initially apply to companies with 250 employees or more, though the General Scheme envisages this threshold decreasing to 150 employees or more after two years and eventually to 50 employees after three years. It should be noted that the anticipated reduction in the threshold brings a lot more employers into the fold in Ireland than in the UK where the threshold is 250 employees with voluntary disclosures for employers who come under that threshold.
Companies who meet these thresholds will be obliged to publish information on:
» the difference in the median and mean hourly pay and bonus pay for men and women;
» the difference in the median and mean part-time pay and temporary contract pay for men and women;
» the proportions of men and women receiving bonuses and benefits-in- kind; and
» the number of men and women in each of the lower, lower middle, upper middle and upper quartile pay bands.
The General Scheme also contemplates the reporting of differences in pay by reference to job classifications.
The General Scheme envisages that the Minister would appoint designated officers to investigate breaches of the reporting obligations. These officers may require access to the employer’s records, and may prepare a report on foot of their findings. Further, where the Irish Human Rights and Equality Commission reasonably believes that the employer has failed to discharge its reporting obligations, it will have the power to apply to the Circuit Court for an order requiring the employer to comply.
The General Scheme proposes that employees will also have the power to refer a breach of reporting obligations complaint to the Director General of the Workplace Relations Commission who will privately investigate the complaint and make a determination. An appeal of this decision will lie to the Labour Court. Both the Director General and the Labour Court will be able to order that the employer undertake a “specified course of action” however, the Scheme does not provide for specific sanctions or fines for non-compliance.
While the General Scheme provides a broad outline for how gender pay gap reporting will work in Ireland, further details are required. In addition, as this proposed legislation passes through the Dáil and the Seanad (Irish Houses of Parliament), it may well be subject to amendment before it is enacted in its final form.
NEXT STEPS FOR EMPLOYERS
The fact that gender pay gap reporting has gained such attention in the UK and has been the subject of two Bills in Ireland indicates that a definite legislative appetite exists to introduce gender pay gap reporting obligations.The timeline on when these obligations will be introduced is unclear but it is likely that gender pay gap reporting will soon become a reality for employers in Ireland.
This provides employers in Ireland with a window of opportunity to “get their houses in order” in preparation for the introduction of this legislation. Employers should consider whether an equal pay audit should be conducted to assess what, if any, disparity exists in remuneration between men and women. If any notable disparities arise, an analysis of why and how these disparities arose should be undertaken. This may mean conducting a review of policies, including in relation to family- friendly leave, bonuses and employee benefits.
While closing the gender pay gap is a worthwhile exercise in its own right, it is advisable that efforts should particularly be made in advance of the introduction of this legislation in order to avoid potential industrial relations problems internally and reputational damage externally.