Gender pay gap reporting, introduced in April 2017 for employers with 250 or more staff, is not seen as an unqualified success. That said, it is still worth working with your outsourced payroll provider to ensure that you are as complaint as possible, even if your business is less than 2500 employees strong and does not qualify for gender pay gap reporting. We look at this issue in this article.
The Gender Pay Gap Still Exists
The BBC reported earlier this year that the pay gap widened at hundreds of big companies. Indeed, in all sectors, men were paid more on average than women. At an individual level, 74% of businesses have a pay gap in favour of men, compared with 14% in favour of women, figures that have hardly changes in recent years.
However, gender pay gap reporting is beginning to make a difference. The Equality and Human Rights Commission reported that 10,738 organisations have reported their pay gap, with some late submitters being named and shamed, including 3 businesses who did not submit information for the second year running.
Equality pay gap reporting is here to stay, however, and is likely to expand. So, especially for smaller companies, how might that affect the information your payroll team is required to gather and report on?
The Expansion of gender pay reporting
The threshold is likely to expand to smaller firms with fewer than 250 employees, as the Financial Times reports:
Hilary Spencer, the director of the Government Equalities Office, which oversees social equality, told the House of Commons Treasury select committee there “are a number of ways we could take reporting in the future. One option is to lower the threshold to smaller employers.”
Ethnicity pay gap reporting is likely to come in
The Race at Work Scorecard Report, published in 2018, showed that only 11% of organisations actually collected data on ethnicity pay gaps. And, although limited only to the tech and digital sectors, BIMA?s Tech Inclusion & Diversity Report found levels of discrimination on the grounds of ethnicity (amongst many other factors) across the industry that were concerning.
In 2017, Baroness McGregor-Smith’s ‘Race in the Workplace’ report recommended that the Government should legislate to introduce mandatory reporting of ethnicity data. She recommended that all organisations with 50+ employees should report on ethnicity race and pay band.
We can expect to see government consultations first, but ethnicity pay gap reporting is most certainly on its way.
Make sure you are ahead of the game
If your organisation has fewer than 250 staff, you don’t currently have to report on gender or ethnicity or anything else. However, the former is likely to happen soon, and the latter will happen at some stage. So, by anticipating these changes and putting in place the right measures to achieve compliance now, you will only need to fine tune when the legislation does arrive.
As an outsourced payroll provider, we can help you put gender and ethnicity reporting measures in place now, so that you are well prepared. Contact us for an initial chat.