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Mind the (gender pay) gap in 2018

With the arrival of a new year, we await new legal developments, cases and change. Nowhere is this anticipation of change greater than in the area of the gender pay gap in the UK.

Publishing gender pay gaps

On 4 April 2018, companies with more than 250 employees will be required to publish their gender pay gap calculations. This has been heralded as the possible starting point for change even if change could take a long time (on average 32 years according to a recent survey carried out by RSM. Even so, the publication of gender pay gap statistics can be seen as the start of that journey even if that journey is going to be long. What is going to happen though if that journey does not even start in 2018?

Worryingly that same RSM survey found that one in 10 companies who are required to publish their gender pay gap calculations in April will not meet this deadline. Only 500 out of 9000 companies in scope have already complied so far although we can inevitably expect some last minute reporting. The reason for this has been put down to problems in extracting the relevant data from payroll systems which are not up to the job and also that some companies may want to wait to see how other companies present their findings first. That makes sense as employers have been carefully advised to put “context” around bare figures and to look to explain gender pay gaps which may on first glance appear stark.

Compliance with the regulations

Should that be happening though when transparency and pay is an urgent priority and more importantly, where is the incentive for companies to comply with the gender pay gap regulations at all when there are no civil or criminal sanctions for not doing so?

When the landmark Supreme Court decision was reached about Employment Tribunal fees in the summer of 2017, Lord Reed emphasised that people and businesses need to know that rights can be enforced and that where rights are breached consequences will follow. Otherwise he said “laws are liable to become a dead letter” – yet here we are again. When the gender pay gap regulations came in, the Government had the opportunity to introduce sanctions for non-compliance but that opportunity was passed up.

Enforcement rights promote justice

The Equalities and Human Rights Commission is now consulting on a proposal to use its enforcement powers against employers who do not comply with the requirement to publish gender pay gap statistics in April. The Commission has said that it wants employers to follow the law without the need for formal enforcement action. But perhaps it is precisely the potential for enforcement action that drives a desire to follow the law. And remembering Lord Reed’s words, having a sense that justice can and will be done because rights can be enforced is very important for all.