27th February 2017
Gender pay gap reporting legislation in force from April 2017
Gender pay gap reporting legislation is due to come into force from April 2017.
The legislation will require employers with 250 or more employees to publish calculations showing the pay gap between male and female employees in their business. The aim is to encourage employers to take action to reduce (or eradicate) gender pay gaps in their organisation.
Regulations for the private and voluntary sectors have been approved and will come into force from April 2017. Employers will have 12 months to publish the information.
Importantly, the definition of employees used in the legislation is very wide and will cover some self-employed individuals and workers. Employers will therefore have to exercise caution when calculating their head count for gender pay gap purposes.
At the moment the regulations will apply to the private and voluntary sectors, however it is understood that the government will aim to include the public sector by April 2017 as well.
Employers will have to carry out six calculations and publish the results on their own website and a government website within 12 months.
Calculations are as follows:
Average gender pay gap as a mean average;
- Average gender pay gap as a median average;
- Average bonus gender pay gap as a mean average;
- Average bonus gender pay gap as a median average;
- Proportion of males receiving a bonus payment and proportion of females receiving a bonus payment; and
- Proportion of males and females when divided into four groups ordered from lowest to highest pay.
The published results have to have been confirmed by an “appropriate person” within the business, such as a Chief Executive. Some employers may also choose to also publish an explanation of the results and set out the action that is being taken to combat their gender pay gap.
Importantly, gender pay gap reporting highlights the pay differences between men and women throughout the business generally. It is separate to the issue of equal pay which considers men and women’s pay for the same work, similar work or work of equal value.