Compulsory gender pay-gap reporting


Responding to political pressure from the Labour Party and trade unions, the government has agreed to legislate to introduce compulsory gender pay reporting by employers with 250 or more employees (section 147, Small Business Enterprise and Employment Act 2015 (SBEEA 15)).


Draft regulations have been prepared. These are expected to come into force in October 2016, and will require employers to publish mean and median pay information across their whole workforce, as well as a breakdown of the number of men and women in each quartile of pay. The full report must be published on the employer’s website each year, and must remain there for at least three years, and also be uploaded to the government. The government plans to “name and shame” non-compliant employers, and to review at a future date whether civil or criminal penalties for non-reporting are needed. 


Commenting on the draft regulations, the TUC has said that it welcomes any move towards securing equal pay but that the proposals do not go far enough: Bosses should be required to explain why pay gaps exist and what action will be taken to narrow them. In addition, non-compliance should lead to tough sanctions and fines. Otherwise, gender pay gap reporting risks ending up a “tick-box exercise”. There is also significant delay, as the first gender pay reports will not be published until 30 April 2018.