If your organisation employs over 250 employees in the UK then, from April 2017, it will need to publish on its UK website and a government sponsored website, certain information which is intended to highlight whether or not it pays men and women equally. Those employers will then have to report annually on gender pay differences going forwards.
There are no particular financial penalties for non-compliance but the reputational risk of not doing so (or doing so badly) is high.
If your organisation is likely to be caught, now is the time to take action. Getting ahead of the game by conducting an early audit will ensure that your organisation is in the best possible position to start ironing out any potential problems. To find out more about what you should be doing, why not come along to one of our workshops, details of which are set out below.
Why has the government acted now?
The Equal Pay Act 1970 required men and women to be paid equally, but in the 46 years since then, the issue of women being consistently being paid less than men has not gone away. Glassdoor Economic Researchers ranked Britain 11th out of 18 countries (below the USA, France, Spain and Sweden) in a league table that took into account pay, board level representation and the gap between male and female employment, among other factors.
To resolve this issue, some have suggested radical measures such as a 'Gender Pay Gap Tax' whereas others have sought ways to increase female participation in job sectors which are both seen as more traditionally male and which tend to attract higher wages, such as financial services, engineering and IT.
The new Gender Pay regulations address the issue head on in another way.
What needs to be reported and where?
To find out what information you will need to provide and how to calculate it, read our earlier alert here.
Remember, employers will also need to report the numbers of men and women in each salary quartile, revealing pay gaps linked to seniority.
The gender pay report must be signed off by a director or equivalent and then published on the organisation's UK website, in a manner that is accessible to the public. The information must also be uploaded to a government sponsored website, which will act like a gender pay league table so that comparison between competitors is inevitable and companies will be 'named and shamed' by the press and organisations dealing with the protection of workers' rights.
In addition, the new gender pay regulations have generated some concern that they could lead to the type of equal pay claims seen predominantly only in the public sector over the last few years.
Getting ahead of the game
We were hoping that the final version Gender Pay regulations would have been published but the Brexit debate has meant that other Government business has taken a back seat.
There are still steps however that organisations can take now, to ensure that the data that they have to publish in 2018 presents the organisation in the best light, including conducting an audit after taking legal advice, to ensure that the results are subject to legal privilege.
A number of organisations have tested the audit process already and found that the results were not entirely publicity friendly. Forewarned is forearmed and by starting to consider compliance early, organisations can begin to review how they recruit, promote and reward their staff with a view to identifying and then ironing out any gender based barriers which might hamper success.
Don't get caught out: identifying problem areas now also allows employers to consider what additional information they might publish, over and above that required by the new regulations, to tell a positive story about the way in which the organisation values its workforce.