The Gender Pay Gap Regulations, otherwise known as the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 came into force in the UK in April 2017. The regulations require all private and voluntary-sector employers with 250 or more employees to publish data on their gender pay gap. Broadly similar rules apply in the public sector under the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017.
Below you will find an explanation of what the gender pay gap is, and how to report on it in compliance with UK legislation.
We recommend that you use the legislation to do an in depth analysis of the gender pay gap and build data driven plans to narrow the gap. Companies which take effective action to address the challenges identified by reporting on the gap see increased return on investment, market share, and higher staff retention.
At Gapsquare, we can help you through all steps and give you access to our top of the class software so that you can monitor progress on gender pay gap and be ready to report again next year.
Here are the steps you need to take to comply with regulations:
What information do you need to report on?
The information must be published on both the employer’s website and on a designated government website.
The 6 key figures on which you will have to report are:
- 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 male and female employees receiving bonus payments
- proportion of male and female employees by quartiles (ie. when divided into four groups ordered from lowest to highest pay).
As you can see, the calculations make use of two types of averages:
- the mean – an average which involves adding up all of the numbers and dividing the result by how many numbers were in the list.
- the median – an average which involves listing all of the numbers in numerical order. If there is an odd number of results, the median average is the middle number. If there is an even number of results, the median will be the mean of the two central numbers.
The ACAS guidelines provide a very detailed step by step guide on how to manage the regulations and do the calculations for reporting. You can cut through that and use one of our tools which will provide the numbers instantly.
The Gender Pay Gap is not Equal Pay
Equal pay deals with the pay differences between men and women who carry out the same jobs, similar jobs or work of equal value. Paying people unequally because they are a man or a woman is illegal.
The gender pay gap shows the differences in the average pay between men and women.
Gender Pay Gap Reporting around the World
National Action Plan for Gender Equality in the Labour Market includes a compulsory requirement for companies to publish equal pay reports.
Companies have to draw up staff income reports every two years. The reports must show the number of men and women classified under each category as well as the average or median income, adjusted for working time, for women and men in the respective category.
Goal is to create income transparency and take measures to reduce gender pay gaps.
In 2012, Belgium adopted a law on reducing the gender pay gap. Differences in pay and labour costs between men and women should be outlined in companies’ annual audit.
The annual audits are transmitted to the national bank and information is publicly available.
Every two years, firms with over 50 workers should establish a comparative analysis of the wage structure of female and male employees. If women earn less than men, the firm is obliged to produce an action plan.
Some provinces have enacted policies to proactively enforce pay equity rather than the standard complaint-based approach
Ontario has one of the most progressive policies in Canada and in the world, requiring both the public and private sector employers to have strategies in place to address pay equity.
In February 2016, the Canadian Parliament adopted a motion that sought to prevent wage discrimination, calling for the government to implement a proactive pay equity law within 12-18 months rather than continue to reply on a complaints-based system
In 2012, started to publish pay analyses of government jobs in 2012
2006 Act on Equal Pay requires companies to report on salaries and plans to close the gender pay gap.
Hardened existing sanctions against firms with 50 employees and above that do not respect their obligations regarding gender equality. In April 2013, two firms were condemned for not complying.
Act to Promote Transparency of Pay Structures (Entgelttransparenzgesetz) came into effect July 6 2017.
Companies with over 200 employees may face claims for information about the average monthly gross salary of at least six colleagues of the other gender who perform the same work or work of equal value.
Companies with over 500 employees are obliged to publish regular reports on their efforts to promote equality, and implementation of operational review procedures and safeguards to ensure compliance with equal pay, starting in 2018. They will also be encouraged to implement internal audits of their pay structures.
In March 2017, Iceland took its efforts to close the gender wage gap even further: it became the first country in the world to introduce legislation requiring companies to prove that they pay men and women equally
By 2022, employers with more than 25 employees would have to undergo audits to certify that they are complying with equal pay laws.
The hope is that by strengthening enforcement of enforcement of existing laws, the new legislation will close the gap in five years.
Almost all employees are obliged to annually collect information – one piece including remunerations which is submitted to the Ministry responsible or labour and employment.
Measures approved in 2013 that guarantees and promotes equality of opportunity and results between men and women in the labour market, including the development and dissemination of a report on the wage gender gaps by industry.
The 2009 Discrimination Act requires employers to carry out a pay survey every three years in order to detect, remedy and prevent unjustified differences between women’s and men’s pay, terms and conditions of employment, and draw up an equal pay action plan (if employing 25 or more workers)