Is your firm in line with the new gender pay gap reporting rules?
New regulations to tackle gender pay equality have come into force, threatening reputational fall-out for firms which don't do enough to commit to gender pay parity.
The gender pay gap reporting duty was outlined in the draft Equality Act 2010 (Gender Pay Gap Information) Regulations 2016 and came into force on April 6th 2017. Its aim is to incentivise boards to take gender diversity seriously.
The need for change is alarmingly clear when you look at the following statistics:
- The full-time gender pay gap is 10% and the average part-time gender pay gap is 34.5%
- On average, women earn £8,500 less than men by their 50's
- For every £1 earned by a man, a woman earns 81p
- The TUC estimates it will take 47 years to achieve gender pay parity
- In FTSE100 companies, just 17% of board directors are women
- 54% of women working part-time (qround 2.8 million) are employed 'below their potential'
- The UK would gain £23 million (equivalent to 2% GDP) if women's skills were better used at work.
Under the rules, companies with over 250 employees are required to publish details of their gender pay gap and gender bonus gap annually. Firms must also calculate and publish the gender bonus gap, the proportion of men and women who get a bonus, and the proportion of men and women working at each quartile of the firm's pay distribution.
Follow these 8 steps and make sure your firm is prepared for the new gender pay gap reporting rules:
- Start planning what data you will need to collect - This should include the gross hourly rate, and taking into account paid leave, overtime expenses, and maternity pay etc. Think about what infrastructure, procedures and resources you'll need to adopt so that the right information is routinely collected and collated.
- Review and update related policies - Assess existing policies (such as enhanced paternity leave or shared parental leave, flexible working, promotion, bullying and harrassment, training and development) and decide whether they should be updated to rectify any gender pay gap.
- Act early - It is possible that data will reveal flaws or shortcomings in existing policies. By getting the data as soon as possible, you'll be able to address potential issues swiftly.
- Plan for the future - The Think Future survey by KPMG found that 55% of female undergraduates (compared with 27% of males) are influenced by a sector's attitude to gender diversity when jobseeking. So, make sure you think longer term about how you're going to attract female talent and reduce the gender pay gap in future, so women are better represented at all levels of your company.
- Set targets - 'What gets measured gets done', right? While you won't be able to transform your workplace overnight, you should start by setting realistic targets in key areas to bring about improvements. Targets can also increase accountability.
- Get the 'tone from the top' right - Having senior management and board-level 'buy in' can make a huge difference. Consider how best to ensure equal representation at all levels, including at senior management and on the board.
- Change the culture - Explore other ways of supporting women - for example, via training, mentoring, offering flexible working hours as standard, creche facilities, and shared parental leave - so you attract and retain top female talent.
- Tackle unconscious bias - Avoid stereotyping or making assumptions based on gender or maternity which might limit opportunity. If you are not sure, ask!