Gender pay gap reporting

Last year, enforcement of gender pay gap reporting was suspended due to Covid and many firms chose not to submit their reports. The Woman and Equalities Committee has called on the government to confirm that reporting will go ahead this year but, at the time of writing, no confirmation has been given.

Since 1997, the gap between men and women’s average pay has been monitored on a national level by the Office for National Statistics (ONS) as part of its Annual Survey of Hours and Earnings. Large private and voluntary sector employers (defined as those with 250 or more employees on 5 April of each year) are required to analyse their gender pay gap each April. The gender pay gap is always expressed as a percentage. It is calculated by working out the difference between the average pay of all male employees and the average pay of all female employees, and dividing that number by the average pay of all male employees.

If reporting goes ahead this year it will be interesting to see the difference from previous years, as the furlough scheme is likely to have had an effect due to the way the calculation is carried out. Only those employees who are receiving their full pay are counted, so employees who are receiving reduced pay on furlough will not be included, while those on furlough receiving full pay will be counted. Reports have shown that low paid, female employees are overrepresented in the furlough scheme and this may therefore mean, if those female employees are not included, gender pay gaps may appear reduced this year in comparison to previous years, even where there has not been an increase in the rate of pay paid to women.

If you need further advice or information contact our employment solicitors.