Page 10 - Gi flipbook February 2018

NEWS | MANAGEMENT

Government gender pay gap laws

“lack power to sanction employers”

THE GOVERNMENT HAS Many companies may fail to report
granted “no direct power” their gender pay gaps accurately
in its gender pay gap
reporting regulations to
the Equality and Human
Rights Commission (EHRC)
to impose sanctions on
employers that fail to
comply, according to a
legal expert.
Anna McCaffrey, Senior
Counsel in Taylor Wessing’s
employment, pensions and
mobility group, told People
Management that because
the government opted not
to include in its regulations
any specific civil or criminal
sanction around gender pay
reporting, the EHRC lacks
the power to impose the
sanctions it has proposed.
The lack of power to
enforce criminal or civil the offer of an agreement with the regulations, their gender pay reporting
sanctions, first reported by and are found to have it is “only a matter of obligations,” said McCaffrey.
the Financial Times, could breached the regulations as time before it introduces The reporting regulations
mean many companies will a result of the investigation. civil penalties for non- require organisations with
simply fail to report their It could also investigate compliance”, said Charles 250 or more employees
gender pay gaps accurately suspected breaches of Urquhart, Partner at Clyde to publish the difference
– or will not report at all. the regulations by private & Co. “There is also the between the mean and
McCaffrey added, and voluntary sector distinct possibility that the median hourly pay rate for
however, that there may employers and offer government will decide to their full-time male and
be “negative publicity and them the opportunity publicise the identity of female employees and
reputational issues” in store to enter into a formal employers known not to the difference between
for companies that are agreement to comply as an have complied.” the mean bonus pay and
found not be to complying alternative to continuing But should the EHRC median bonus pay for male
with their obligations, which with the investigation. Such want to take action against and female employees. It
may lead to regulatory agreements can themselves non-compliant employers also requires reporting of
enforcement. be enforced in cases of non- in the meantime, it would the proportion of male
The equalities watchdog compliance, the EHRC stated. have to rely on its general and female employees
launched its enforcement On the sanctions’ lack enforcement powers under awarded bonus pay, and
strategy on 19 December of legal enforceability, the Equality Act. the proportion of male and
to tackle non-compliance McCaffrey said it was The issue with using female full-time employees
of gender pay audits, possible that further these powers in relation in the lower, lower middle,
warning employers that reviews on how the to gender pay reporting is upper middle and upper
those who failed to meet gender reporting rules that the Equality Act does quartile pay bands.
their reporting obligations were working in practice not specifically include a The deadline for
would face “unlimited” could “prompt changes requirement on employers reporting data for private
fines and convictions. such as introducing explicit to publish gender pay sector employers, required
The strategy states sanctions for those that information. “There are to be published on
that the EHRC may seek don’t report, or to clarify therefore reasonable organisations’ websites
summary convictions and the scope of the EHRC’s grounds for a technical and the government’s
an unlimited fine against enforcement powers challenge of an attempt gender pay gap service
organisations that still under the gender pay gap by the EHRC to use its website, is 4 April 2018.
refuse to comply with a reporting regime”. enforcement powers under However, as it stands, just
court order, and may issue If the government feels the Equality Act to take 499 of an estimated 9,000
unlawful act notices against an insufficient number of action against employers employers have published
those that do not accept companies have complied for not complying with their figures. ■

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News.indd 5 18/01/2018 11:18