- UK one of the first countries to require companies to report gender pay gap – over 9,000 employers set to publish theirs from today
- Gender pay gap now at a record low of 18.1 per cent in the UK
- Gender pay gap is at 21.4 per cent in East England
- Eliminating work-related gender gaps could add £150bn to annual GDP by 2025
The UK is one of the first countries in the world to require gender pay gap reporting and follows the government’s commitment to introduce the requirements at the last election. This is a key part of the government’s work to eliminate the gender pay gap.
Voluntary, private and public sector employers with 250 or more employees will be required to publish their figures by April 2018. The regulations will cover approximately 9,000 employers with over 15 million employees, representing nearly half of the UK’s workforce.
The UK gender pay is already at a record low of 18.1 per cent. These requirements will help employers to identify the gaps in their organisations and take action to close the gender pay gap.
Ensuring that women have the same opportunities as men to fulfil their potential in the workplace is a key part of building a country that works for everyone, as the Prime Minister made clear in her first speech outside Downing Street.
Minister for Women and Equalities Justine Greening said: “We have more women in work, more women-led businesses than ever before and the highest proportion of women on the boards of our biggest companies. This has helped us to narrow the gender pay gap to a record 18.1 per cent – but we want to eliminate it completely.
“Helping women to reach their full potential isn’t only the right thing to do, it makes good economic sense and is good for British business. I am proud that the UK is championing gender equality and now those employers that are leading the way will clearly stand out with these requirements.”
The benefits of helping women to unlock their talents are huge – eliminating work-related gender gaps could add £150 billion to our annual GDP by 2025. That is an opportunity that neither Government nor businesses can afford to ignore.
As part of the new regulations, employers will be required to:
Publish their median gender pay gap figures
By identifying the wage of the middle earner, the median is the best representation of the 'typical' gender difference. Employers will be asked to use data from a ‘snapshot’ period in April to calculate this average.
Publish their mean gender pay gap figures
By taking into account the full earnings distribution, the mean look at both the low and high earners in an organisation – this is particularly useful as women are often over-represented at the low earning extreme and men are over-represented at the high earning extreme.
Publish the proportion of men & women in each quartile of the pay structure.
This data will show the spread of male and female earners across an organisation, helping to show employers where women’s progress might be stalling so they can take action to support their career development.
Publish the gender pay gaps for any bonuses paid out during the year
As there is a significant issue around bonus payments in some sectors, employers will also have to publish the proportion of male and proportion of female employees that received a bonus during the year.
Employers will also be encouraged to publish an action plan alongside their figures, demonstrating the steps they will take to close the gender pay gap within their organisation.
The Government is working with leading employers who are exploring publishing their figures early.
The Government Equalities Office has also launched its new campaign page where employers can access resources, case studies and publish their gender pay gap figures.
The new gender pay gap mandatory reporting requirements are part of wider work the Government is doing to support women in the workplace. This includes £5 million to increase returnships, offering 30 hours of free childcare, and introducing shared parental leave and new rights to request flexible working. There is also extensive cross-Government work to get more women into the top jobs at the UK’s biggest companies and to get more girls taking STEM subjects at school.
To help employers, the Government Equalities Office and Acas have produced guidance on managing gender pay reporting: http://www.acas.org.uk/index.aspx?articleid=5768
Acas Chief Executive Anne Sharp said: “Compulsory gender pay reporting starts this week. The new requirement provides a great opportunity for organisations to consider whether they can do more to develop their talented women and secure the benefits of greater gender diversity at all levels.
"The UK has made progress in reducing the gender pay gap but we still have lots to do - tackling the issue is in the interests of individuals, organisations and the economy as a whole.
"Acas guidance on gender pay reporting provides businesses with practical advice on how to carry out the calculations and on family friendly working to reduce the gap."
Emma Codd, Managing Partner for Talent at Deloitte UK, said: “Today sees a big step forward in the journey to achieve gender parity in the UK. For the first time people will be able to see the gender pay gap of large employers at one fixed point in time, with this gap measured and reported in a consistent way. They will be able to read about the causes of each company’s gap and the actions that are being taken to close it; they will also be able to determine for themselves those companies that are serious about this and those that are not. This is a massive shift in transparency – and without any doubt is a hugely positive thing.
“Previously reporting our own gap gave us an opportunity to show not only that we fully understood why we had a gap, but also the significant actions that we are taking to close it. We were able to clearly show that these actions were focused on delivering long term meaningful and sustained change – through both a focus on our culture and targeted interventions - and that it is the responsibility of our firm’s senior leadership to ensure this change happens. This transparency has shown itself to be a positive for us – both in terms of our current workforce and those considering joining us; we look forward to continuing on this journey.”
Ann Francke, chief executive of the Chartered Management Institute, said: “The gender pay reporting regulations are a great way to encourage employers to figure out how they can equalise what they pay their men and women. Creating transparency and setting targets are just the start; businesses must take a hard look at the reality of the many causes, like casual gender discrimination.
“We may live in more enlightened times but clearly we still have some way to go. Men and women have an equal role in creating a company culture that benefits all, so managers must call out any bad behaviour whenever they witness it.
“Today’s regulation is a real opportunity to create a more inclusive, more diverse, and more productive workforce – all of which is vital if Britain is to thrive post-Brexit."
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For more information, please contact Francesca Roettger Moreda: [email protected] / 020 7654 6157 or 020 7783 8300
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