Gender Pay Gap Legislation – are you ready?

Gender Pay Gap Reporting is on the way… is your business ready?

Who will it affect?

Tait Walker has seen an increase in those seeking advice on the new legislation. We believe that some payroll teams will initially struggle to cope with the extra demand that it will bring.

From April 6 2017, individual employing entities with 250 employees or more will have to collate the relevant payroll information. This will allow the company to publish the differences between men’s and women’s salaries on both its own website and to the Government by April 4 2018.

These regulations are thought to initially affect around 8,000 companies and 11 million employees. Corporate groups may also choose to voluntarily disclose information across the wider group. Details should be published on workers providing personal services, including zero-hours contractors, some freelancers and short-term contractors.

The latest ONS figures show that the current pay gap for full-time workers stands at 9.4 per cent*. Failure to comply with the new legislations will constitute an unlawful act and punishment may be brought in before next year. There is currently no specific civil or criminal penalties for a failure to comply.

Our advice

Clair Williams, employment tax advisory manager at Tait Walker, said: “There have been various changes in employment law in the last few years, and this new legislation may prove to add further burden on payroll teams. A main concern for businesses is that current payroll systems are not yet equipped to pull out the relevant information required.

“Initially, companies will need to make sure that their systems are able to deal with these new requirements. It is important to take action quickly so that companies can to assess the outcomes and make any necessary changes. Surprises may occur so it will be important to ask key questions – what does the gender pay gap look like for the business? If there is one, why? Advice may need to be sought from a lawyer if there is a clear disparity.

“The published reports will be in the public domain and businesses will need to explain the results. A clear pay gap between men and women will need to be handled sensitively. Communication with staff may be needed before the results are published.

“There are still a number of individuals and businesses who aren’t even aware of the legislation. The first priority needs to be to raise awareness of it and what it means to them.”