On 20 January the Government published draft regulations setting out a requirement for public sector bodies in England with 150 or more employees to publish their gender pay and bonus gap. The Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 (the Regulations) bring in the gender pay gap reporting duty as part of the existing public sector equality duty (the PSED). The Regulations have been laid before Parliament and are expected to come into force in two months' time: on 31 March 2017.
The Regulations mirror to a great extent those coming in for private sector employers. Indeed these are appended as a schedule to the Regulations and contain the detail of what's required.
The main requirements are for public sector employers in scope to carry out six calculations and publish those figures by 30 March 2018 at the latest. In particular they must publish:
- The overall difference in the mean and median hourly rate of pay between a male and female employee (who is not being paid at a reduced rate as a result of being on leave and defined as a full pay relevant employee in the Regulations) on a snapshot date of 31 March 2017.
- The difference in mean and median bonus pay made to male and female employees during the 12 months ending with 31 March each year.
- The proportion of male and female employees who received bonus pay in that 12 month period.
There is a further obligation to set out the relative proportions of male and female full pay relevant employees working across salary quartiles. The idea behind this is that it will assist in showing where the ceilings for progression are for females within the organisation.
The figures need to be signed off as accurate by a director, and published on an organisation's own, and a Government website. The obligation applies on an annual basis from March 2018.
There is also a further reporting duty that obliges public sector bodies to publish information demonstrating compliance with the PSED which in the usual way must be specific and measurable, and published in a manner that is accessible to the public.
ACAS have also today published their draft non statutory guidance to assist the private and voluntary sector with managing their gender pay and bonus gap reporting. While the NHS will face different issues, given the substance of the Regulations are derived from the private sector regulations this is helpful reading for those managing the gender pay gap reporting project in the NHS.
What this means for NHS bodies:
NHS bodies do not have long to ensure they have access to all the payroll data needed to analyse their gender pay gap on the snapshot date of 31 March 2017. A project team involving payroll and HR needs to be established if one does not already exist. Those gathering this data will need to be briefed on what elements of pay need to be included in the analysis. For instance shift premium pay should be included, but overtime payments should not. The Board will also need to be briefed on the requirements. While Agenda for Change has been found to be equal pay compliant, NHS bodies are still likely to be reporting a gender pay gap particularly where males dominate the senior management positions, if the organisation has more senior male than female doctors, and because of occupational clustering of females in nursing.
While there is no obligation to provide an accompanying narrative to the figures, many NHS bodies will wish to do this. Ensuring good internal and external communication about the difference between unequal pay for men and women (which is unlawful), and the gender pay gap (which is not unlawful) will be a crucial part of these communications, as will giving any explanations for why the gap exists (which may include some of the reasons noted above). Taking these steps should help to reduce any reputational damage, and legal risk that reporting a gender pay and bonus gap brings.
DAC Beachcroft has been at the forefront of advising on, and litigating these matters over the past decade. We have successfully defended thousands of equal pay claims for our NHS clients, shaping that national litigation through the test cases we have run. We have worked with the GEO to shape these reporting regulations.
We can assist with:
- Helping you understand what you need to include in the calculations.
- Examining the causes of your gender pay gap and advising on steps to put this right.
- Working up internal and external communications surrounding your figures to reduce reputational damage both inside and outside of your organisation.
We can do all this under legal privilege to ensure that any initial drafts of communications or misleading data does not need to be published.