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Insights

09 January 2019

Gender Pay Gap: approaching the second reporting date

The second deadline of 4 April 2019 for employers to report on their gender pay gap is fast approaching. According to the government website, so far only 6.5% of employers have reported and therefore it looks as though, in the same way as last year, most are leaving it to the last minute to upload their information.    

It is likely, with the second report, that whether any progress has been made towards closing the gap will be scrutinised by staff, shareholders, potential recruits and in some cases, the press. However, reporting the figures is just the starting point.   

Action plan and contextual narrative

The Equality and Human Rights Commission (EHRC), published its report Closing the gender pay gap, on 14 December 2018. The report was based on research analysing 440 gender pay gap reports from a variety of sectors and explores the shortcomings of the reporting regulations, which only require data to be published, as well as looking at effective ways of tackling the gap. 

The EHRC’s report urges employers to provide a contextual narrative which gives them a valuable chance to set out publicly any reasons for the gap and its action plan. It also makes the point that any action plan should set out targets and timescales based on best practice rather than consisting of generic statements such as “reviewing flexible working” without any real thought as to how or when this will be done. It considers that transparency with measurable targets and timescales demonstrates a genuine commitment to making improvements and will enable employers to analyse their own progress on an annual basis.    

Action plans also featured in the Government Equalities Office guidance Reducing the gender pay gap and improving gender equality in organisations published in October 2018. This sets out evidence based actions for employers to help them create more effective action plans. These are divided into:

  • effective actions which have been tested and found to have a positive impact (such as including multiple women shortlists, skills-based assessments and encouraging salary negotiation by showing salary ranges);
  • promising actions which require further research to improve evidence on their effectiveness (such as improving workplace flexibility for men and women, encouraging the take-up of shared parental leave and offering mentoring); and
  • actions with mixed results from the evidence so far (such unconscious bias training, diversity training and diverse selection panels). 

Employers who are yet to report would be well-advised to consider both the report and guidance in considering putting together action plans going forwards.

The future

Although it sounds obvious, gender pay reporting is an annual requirement and with each year that passes, more will be expected of employers to show an improvement in their statistics or an explanation if the gap is not narrowing. In fact, failure to provide an explanation means the data on its own could be misleading or could damage the employer’s reputation. 

Reducing the gender pay gap is not going to happen overnight. However, employers should take this opportunity to have a good look at where they are now and where they want to be in the longer term. Narrowing the gap benefits all and according to the EHRC’s research, publishing an action plan and narrative helps employers to attract and retain the best talent as well as helping to enhance reputation and brand.


For more information please contact Nick Hurley.

 

 

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