Gender pay gap reporting - why it matters to the Financial Services sector
The Financial Services sector was recently highlighted as having one of the largest gender pay gaps by the Government when it launched its website revealing the gender pay gap by profession. The Government will be closely monitoring levels of compliance with the Gender Pay Gap Reporting Regulations, (the Regulations) which come into force in April 2017 and apply to all employers with 250 or more employees.
The first pay data snapshot is due to be taken on 5 April 2017 and employers have 12 months in which to compile the report for publication by 4 April 2018. The Regulations impose several ways of reporting: mean and median pay, salary quartiles and bonus differences. The information must be published on the employer's website (to remain there for three years) and a government sponsored website.
To assist employers ACAS and the Government Equalities Office have published joint draft guidance (the Guidance) on the Regulations together with factsheets and a notification template.
Although there are currently no financial penalties for employers who do not comply with the reporting requirements, there are important reasons for those in the sector to take this seriously.
- potential reputational damage particularly if the Government revives its plan to name and shame non-compliant employers;
- potential enforcement action by the Equality and Human Rights Commission (EHRC) for any failure to comply. The EHRC has formally stated that it will regard non-compliance as an "unlawful act";
- the risk of a whistleblowing claim, if an individual raises the failure to report as a breach of a legal obligation and detrimental action is subsequently taken against them; and
- the risk that any failure to comply combined with being a sector known to have a large gender pay gap could be used to a claimant's advantage in an equal pay claim.
In addition, there are benefits for tackling any pay gap head-on which include a positive reputation in the marketplace which will assist in recruiting and retaining talent and will result in increased loyalty and employee engagement.
We have teamed up with a specialist HR consultancy to offer a package which includes broad-ranging help, from a free assessment of your current pay structures to decide whether there are any potential equal pay issues, to the provision of a job evaluation scheme report (JES report). The JES report is a skills based assessment of the roles within your organisation and their relative, appropriate remuneration level. The report provides your organisation with recommendations for any changes you need to put in place before gender-based data needs to be publically disclosed in 2018 as well as a defence to any future equal pay claim.
By instructing us to provide advice and assistance and, in particular, review any problem areas this work will be confidential and protected by legal privilege.
We have also produced practical guidance setting out the steps required to comply with the reporting requirements. Please contact us if you would like more information on this.
This article was written by Nick Hurley. For more information please get in touch via firstname.lastname@example.org or +44 (0)20 7203 5039.
News & Insights
Toolkit for the new Senior Managers and Certification Regime
Vanessa Walters sets out some of the key principles of the regime and how FCA regulated firms can best prepare for it.
Initial Coin Offerings - an unregulated minefield
Jamie Cartwright and Thomas Plowman explore the largely unregulated minefield of Initial Coin Offerings and the potential for litigation.