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2nd May 2018

Gender Pay Gap Reporting & Equal Pay

It is common knowledge that there still remains a significant gap in pay between women and men in the UK and this has been thought to be as a result of a number of factors including; the impact of motherhood on women’s careers, lack of quality part-time work, job segregation and the lack of women in senior roles.

 

Equal pay rights have been around for decades, but following the first round of gender pay gap reporting (GPGR) being published, it has been thrown into spot light again. Although both GPGR and equal pay rights seek to bring about equality in pay between women and men; the two are distinctly separate.

 

GPGR requires companies employing 250 or more employees to publish an annual report on the difference between men and women’s average hourly earnings and bonuses taken on a ‘snap shot’ date (i.e. 31st March for public authorities and 5th April for everyone else).  This is presented as mean and median figures and includes in percentage terms the proportion of men and women receiving bonuses and the proportion of men and women falling within each quartile of their pay structure.

 

This reporting process is designed to encourage companies to look inward and seek to reduce their gender pay gap, so the next time they report, a reduction is achieved which will show that positive efforts are being taken to address the ongoing situation.

   

Equal pay is the right for men and women to receive equal pay for equal work. This right is implied into every contract of employment by law. To succeed in an equal pay claim in an employment tribunal, a claimant (who may be a man or woman), who is an employee, apprentice or worker, must be able to show that they are employed on ‘like work’ (i.e. the same or broadly similar), ‘work rated as equivalent’ (i.e. roles rated under a job evaluation study/scheme) and/or ‘work of equal value’ (i.e. equal in terms of the demands made) and that any term which is of a similar kind to the comparator’s is less favourable.

 

A company may be able to defend a claim of equal pay if it has carried out a non-discriminatory and reliable job evaluation study and has a set grading system in place or if they have a genuine ‘material factor defence’. If the company can show that any disparity in pay is due to a gender neutral factor, which while it may have a disproportionate adverse effect on women, is objectively justified. Examples include different hours, geographical reasons, market conditions/skills shortages, past performance etc.

 

The key point to take from this is this, gender pay gap reporting relates to the difference in gender pay across the whole of an organisation, whereas an equal pay claim involves a comparison of one role with another. These figures therefore do not provide conclusive proof that individuals working for the company are not receiving equal pay.

 

That being said, if the figures show a significant disparity in pay, this is likely to prompt difficult questions being raised. Disgruntled female members of staff may use this as a reason to raise a grievance if they feel they are being underpaid and/or submit a questions and answers request (formerly an equal pay questionnaire) to elicit information that may support an equal pay claim.

 

If you feel that you are not receiving equal pay or your business has received complaints or claims of equal pay or need advice on any other employment matter, call our employment expert today – Karen Bristow on 01256 305508.

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