UK Government Launches Gender Pay Gap Consultation

    July 2015

    The UK Government has launched a consultation on its commitment to introduce regulations to require private and voluntary sector businesses with at least 250 employees in Great Britain to publish gender pay gap information. A gender pay gap shows the difference between the average earnings of men and women as a percentage of men’s earnings. According to the Office for National Statistics, the current overall UK gender pay gap of 19.1% shows that a woman, on average, earns around 80p for every £1 earned by a man.

    The power to make the necessary regulations is already contained in the Equality Act 2010. The Small Business, Enterprise and Employment Act 2015 requires the regulations to be made (but not necessarily in force – see below) by the end of March 2016.

    The consultation – which closes on 6 September – seeks views on:
    • Where employers should publish their gender pay information, e.g. their public website.
    • The ability of employers to calculate differences in the pay of male and female employees, e.g. being able to calculate the difference between the earnings of men and women as a percentage of men’s earnings and to break down gender pay gap figures by full-time and part-time employees, grade or job type.
    • The frequency of reporting (which will be no less than every 12 months).
    • The cut-off periods for calculation of the gender pay gap. The Government has suggested 1 January, 6 April or 1 October as possible cut-off periods.
    • When the regulations should come into force. The Government has raised the possibility of a phased introduction, with employers with 500 employees upwards being required to publish the information earlier than those with 250 employees.
    • Whether the proposed threshold of 250 employees is appropriate.
    • Whether civil enforcement procedures are required to ensure compliance with the proposed regulations and if so, what form these should take.
    Although the Government expects to make the required regulations during the first half of 2016, it intends to delay implementation for an appropriate period – yet to be confirmed – to give businesses an opportunity to “prepare”. 

    In the meantime, employers likely to be affected by the reporting requirement should:
    • Review pay practices and rates to identify and understand any differentials that may exist.
    • Identify potential risk areas within the business.
    • Consider whether the internal infrastructure is in place to comply with the pay and gender reporting requirement.