Employment Law Update - January 2017

Employment Law Update - January 2017

Last month the Government published the final details of the gender pay gap reporting regulations. Many of the provisions outlined in the draft regulations have been adopted, however there are some changes which are of particular note to all employers.

Does this change who is in scope?

A highlight within the final regulations is clarification surrounding the definition of an ‘employee’

The definition used in the Equality Act 2010 will apply i.e. someone working under an employment contract or a contract to do work personally. This means including those self-employed who have a contractual obligation to perform work personally and who cannot provide a substitute. This would therefore incorporate some consultants, independent contractors etc.

In view of this, more employers may find that they fall within the scope of the regulations (bearing in mind that the 250 employees threshold may now be reached), when they add in these type of ‘employees’.

Other changes and their potential impact

  • The ‘snapshot’ of the data starts earlier than anticipated – this is now 5th April rather than 30th April. This may have an impact, depending on the employer’s payroll arrangements.​ Furthermore as you now need to include consultants and other contractors, consideration will need to be given to whether these are paid in the same way, under the same processes –possibly not!
  • How the gender pay gap is calculated and what is included has been revisited therefore employers (and in particular those responsible for producing this data) will need to check this element of the regulations to ensure that they have understood what is required of them. 

There are now six sets of figures required:

  • The percentage difference in mean hourly pay between male and female employees on the snapshot date

  • The percentage difference in median hourly pay between men and women on that date 

  • The percentage difference in the mean bonus between men and women in the previous 12 months

  • The percentage difference in the median bonus (this has been added in since the original proposals) between men and women in the previous 12 months

  • The percentage of men and women respectively who received a bonus (which must also be expressed as a percentage) in the previous 12 months

  • The percentage of men and women in each hourly rate pay quartile, split evenly across the workforce, reported by upper, upper middle, low middle and lower bands

The Role of the HR team

It is recommended that if the HR team is not already involved, it should be.

It is reported that joint guidance from ACAS and the Government Equalities Office, expected early next year, is likely to go beyond compliance and provide advice on managing the reporting and addressing gender pay gaps. The HR team can help with this and ensure that a joined up approach is adopted: providing valuable insights into how issues raised through gender gap reporting may be improved upon.

HR Services for SME’s

At cHRysos HR we have experienced HR consultants who have worked in a wide range of business sectors and types of organisation. They have extensive knowledge and experience in employment law and best practice in managing people.

If you require any guidance and support please get in touch with us by email at info@chrysos.org.uk or Telephone 01302 802128.

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