Employers must take action now to provide for new requirements
New requirements to publish discrepancies in pay between men and women could be used as “ammunition” for equal pay claims against private sector employers, employment lawyers have warned.
By October 2016, employers with 250 or more employees in the UK will need to publish annual reports on their gender pay gap, to comply with regulations introduced under the Small Business, Enterprise and Employment Act 2015. Last week, the government published its response to its consultation, Closing the Gender Pay Gap. Further responses are due by 11 March 2016.
To comply with the new rules, it is likely that employers will need to publish the difference in mean and median pay between genders, the difference in mean bonus pay between genders, and the proportion of each gender receiving bonus pay. The data must be reported within 12 months on the company website. No civil penalties have been proposed, although non-compliant companies may be publicly named.
Andrew Taggart, partner at Herbert Smith Freehills, says: “Employers should take action now to prepare for the changes required by the regulations and be aware that pay information may be used as ammunition for equal pay claims.
“Until now, these claims have been restricted largely to the public sector where pay information is often more readily available. However, everything could be about to change and private sector employers may find they have very significant liabilities for which they have not made adequate provision.”
Paul Epstein QC, of Cloisters chambers, says: “The information employers will be obliged to publish is likely to help their current and former employees understand whether they can bring successful equal pay claims.”
