InsightsInsight - Employment & HR - POSTED: June 24 2015
Will your business’ reputation survive reporting your gender pay gap?
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Equal pay is an area of law stark in its statistics:
- 45 years since the Equal Pay Act was passed
- It is estimated 77% of men and 50% of women work worldwide
- 21.4% full time pay gap in the UK between men and women in 2012
- Against an annual wage of £25,000 on average a woman would only be paid £19,650 for the same work.
Do you know if and if so by how much more male employees in your business earn compared with their female counterparts?
If not, now would be a good time to start working this out.
The government included a power in the Equality Act 2010 to require private sector employers with more than 250 employees to report on gender pay gaps. Five years on, this power had not been used. The government, in the Small Business Enterprise and Employment Act 2015 passed on 26 March 2015, committed to making this requirement law within a year and the new reporting requirement is expected to apply to all businesses with more than 250 employees.
No draft regulations have yet been published and it is not yet clear what data employers will be required to disclose, when to whom and how often.
Why raise this now when the rules are unclear and the implementation remains nine months away?
We suspect that many businesses have not yet fully considered or assessed this issue or the impact publishing this date could have. Pay levels are still one of the great unspoken secrets within organisations. They are normally unspoken both internally and to the wider world.
The impact of having to disclose pay levels as between men and women could be far reaching. There are of course implications legally in terms of potential equal pay claims. However, there are also much wider considerations including the impact on employee satisfaction, recruitment and retention and from a commercial and brand reputation viewpoint.
Taking steps to assess, analyse, understand, and potentially explain, justify or seek to rectify gender pay gaps can require significant time and planning.
There are of course often complex historical reasons involved and complicated legal considerations that will apply. Summer 2016 will be upon us sooner than we may currently realise.
This content is correct at time of publication
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