Mind the gap
Statistics have shown that on average, women still earn less than men. This is known as the ‘gender pay gap’. To increase transparency around gender pay differences, in April of this year the Government brought in regulations which makes it mandatory for large employers to publish a report on their gender pay gaps. These reports will make for interesting reading in the travel sector and may increase the pressure on the industry to revisit their strategy for getting more gender diversity in certain roles which have historically been dominated by one gender.
Who is required to produce a report?
Voluntary and private sector organisations with 250 or more employees on the “snap shot date” (5 April each year) are required to publish an annual report. The deadline for the first report is 4 April 2018.
The definition of “employee” is wide. Individuals will count if they are employed under a contract of employment, a contract of apprenticeship or a contract personally to do work. However, individuals who are on reduced or zero pay on the snapshot date because of leave (sickness, maternity, paternity for example) will be excluded from the headcount numbers.
What information should be published in the report?
Employers are required to publish:
their gender pay gap and their gender bonus gap calculated in accordance with a set formula;
the proportion of men and women receiving bonuses in the same 12 month period; and
proportion of men and women in each of the four pay bands when ranking hourly pay from highest to lowest across the organisation.
The report must be signed by a director or equivalent and, although not mandatory, organisations are encouraged to provide a narrative. A narrative provides a good opportunity to explain why there is a gender pay gap and what action the organisation plans on taking to tackle it.
Where can I find my company’s report?
The report has to be published on the employer’s website every year and kept there for a minimum of three years. It will also have to be uploaded to a government website.
What happens if a company doesn’t publish a report?
Failure to publish will be an unlawful act and organisations could be on the receiving end of a compliance notice. Practically speaking, ‘naming and shaming’ by the press and/or public is likely to be the bigger risk to non-compliant organisations and this may affect their brand and reputation with investors, consumers and staff.
What about organisations that do not have to produce a report?
Even if an organisation does not have 250 employees, it should still be aware of the issue. It is likely all organisations (big and small) will face greater scrutiny on gender pay issues from staff as knowledge of the reporting increases. Organisations may also be asked for information on their gender pay gap when tendering for work with larger businesses or from prospective employees during recruitment.
Organisations should prepare for questions about their gender pay gap, regardless of whether they are caught by the regulations. They can start preparing by:
reading the guidance notes from ACAS and the Government on gender pay gap reporting which can be found online
preparing for publication of the report if they are caught by the regulations and considering the possible reasons for any gender pay gap
creating an action plan to address and remedy any issues and minimise risks which could be fed into an accompanying narrative
consider publishing a report (if not mandatory) to demonstrate commitment to tackling the gender pay gap.
Published: 4 May 2017