Contact: Nick Huffer; Clarkslegal (Reading, England)
The UK government has published the draft Gender Pay Gap Regulations and consultation. Below is an initial Q and A.
Which employers are affected?
The regulations will apply to private and voluntary sector employers in England, Wales and Scotland with at least 250 employees.
When will the Regulations come into force?
The regulations are due to come into force on 1 October 2016, although employers will not be expected to publish the required information immediately. The regulations will require employers to calculate gender pay gaps using data from a specific pay period every April from 2017. First publication must be within 12 months of that date.
What is meant by pay? Bonus included but not overtime
“Pay” for the purposes of the Regulations includes basic pay, paid leave, maternity pay, sick pay, area allowances, shift premium pay, bonus pay and other certain other elements of pay (including car allowances paid through the payroll).
It does not include overtime pay, expenses, the value of salary sacrifice schemes or benefits in kind.
What to publish and when?
The regulations will require employers to publish their overall mean and median gender pay gaps.
Employers within scope will need to publish the difference between the mean bonus payments paid to men and women. The mean takes into account the full distribution of bonuses paid by an employer. Only those employees who receive bonuses should be included in the calculation. Employers will also be required to publish the proportion of male and female employees that received a bonus.
Employers will be required to report on the number of men and women in each quartile of their pay distribution. Employers will calculate their own salary quartiles based on their overall pay range. The objective is to identify the numbers of women and men in each quarter by the overall pay distribution.
Where to publish?
Employers must publish the information in English on their searchable UK website that is accessible to employees and the public. Employers will be required to retain this information online for three years in order to show the progress made. In addition, employers must upload the information to a government-sponsored website.
What penalties will apply?
The government’s consultation paper says that a database of complying employers will be built up as employers link their published information to a government-sponsored website, with examples of compliance and non-compliance identified. There is no intention to create any additional civil penalties in the regulations at present, but the government will be monitoring levels of compliance with the regulations during the initial years of implementation.
