Insight
Since 2017, employers with a headcount of 250 or more have required to comply with regulations on gender pay gap reporting. The regulations require employers to calculate and publish annual gender pay gap information in relation to mean and median pay gaps. Normally the deadline for publishing such data is March/April each year but this years deadline was extended due to the pandemic to the start of October.
This years data has now been analysed and reveals that across the country the gender pay gap is failing to improve and indeed in some sectors is getting worse.
A recent report published by King’s College London was critical of the current regulations stating it “has no teeth” as the regulations do not compel employers to take action to address any pay gaps. The report calls for a shift in emphasis “from a monitoring tool to an action tool”.
It is correct to say that the current regulations only require employers to report gender pay gap information, the publishing of an accompanying narrative to explain any gender pay gap is discretionary. Whilst any finding of a large gender pay gap is not likely to be an ideal scenario for employers, having a gender pay gap alone does not of itself mean that employers have breached equal pay laws/requirements due to various issues which are at play within the gender pay gap (some are out of the control of employers).
With the UK Government promising to bring an Employment Bill to parliament in the near future it remains to be seen whether they will legislate on this issue as part of any new bill. Employers will need to be wary of this and the potential implications this may have on their business.