One in four gender pay gap reports found to be non-compliant
Gender pay gap reporting was introduced in 2017 to increase transparency around the gender pay gap across UK businesses. The gender pay gap regulations require any organisation that has 250 or more employees to publish and report specific figures about their gender pay gap, including the gender pay gap in hourly pay and the gender pay gap in bonuses paid.
In December 2017, the Financial Times reported that one in 20 UK companies that had submitted gender pay gap data had reported numbers that were “statistically improbable” and therefore “almost certainly inaccurate”.
On Monday, workforce data analytics firm Staffmetrix published its findings, having looked at 322 gender pay gap submissions from between 1 April and 15 October 2018. It identified that 38% had been submitted in April, and although it is possible that some organisations were reporting on their April 2018 data, it is likely that many of these reports were late reports with data relating to the previous year. Staffmetrix also notes that 9% of organisations had submitted data with impossible outcomes, and a further 1% had submitted reports where the bonus gap was reported as being greater than 100% - this should be impossible to achieve unless the average woman is receiving a negative bonus.
Staffmatrix note that “gender pay gap reporting will again attract high levels of interest between now and the 2019 reporting deadlines. To mitigate the risks associated with publishing improbable data, business leaders must ensure their data is accurate and communicate in their accompanying reports how they plan to address gender imbalance in their organisations”.
Failure to comply with the gender pay gap regulations is enforceable by the Equality and Human Rights Commission (EHRC), but the business, energy and industrial strategy committee (BEIS) has criticised the government for “failing to clarify the legal sanctions available to the EHRC to pursue those failing to comply” and recommended that the government “rectifies this error at the next opportunity”.
The news that one in four gender pay gap reports were found to be non-compliant will likely add fuel to the BEIS’s findings, and possibly push the government into reviewing the mechanisms that EHRC can use to pursue those who fail to comply.
In any event, businesses and charities with 250 or more employees must publish their gender pay gap reports by 4 April 2019, and now would be a good time for employers to ensure that their approach is compliant.