Employment Update: Mind the Gap – Gender Pay Gap Reporting
25 August 2017
Gender pay gap reporting promotes transparency and accountability in relation to the pay levels of both men and women. Its primary objective is to eliminate inequality of pay between them.
The issues which contribute to the disparity between the pay of men and women are well rehearsed. They include gender segregation in education and in the workplace, the challenges of balancing work and family life, the role of the woman as the primary caregiver to children, the availability and affordability of childcare and the pay structures that exist within organisations
While gender pay gap reporting does not tackle these issues directly, it has been internationally accepted as a progressive step in closing the gap between men and women in terms of pay.
In its 2014 study, the European Commission found that women in Ireland earn 13.9% less than men. Across the EU, on average, women earn approximately 16.7% less than men. The World Economic Forum predicted that it would take until 2186 to close the current pay gap.
Current position in Ireland
The current position in Ireland is that there is no general legal requirement for an organisation to publish information relating to gender pay.
In fact, there has been no legislative development which has addressed the issue of gender pay inequality in over 40 years since the Anti- Discrimination (Pay) Act 1974.
Although our discrimination laws prohibit discrimination on the grounds of gender, they do not always take into account more subtle factors which can contribute to the gender pay gap and which are far more systemic than overt discrimination.
What gender pay gap reporting could look like in Ireland
A private members bill, the Irish Human Rights and Equality Commission (Gender Pay Gap Information) Bill 2017 (“the Draft Bill”) was initiated by the Labour party back in May 2017. It provides that an organisation with more than 50 employees may be obliged to publish certain information on the gender pay gap.
In its explanatory memorandum, the Draft Bill states that it is “a diagnostic rather than a curative measure” which allows employers “to benchmark their firms against competitors”.
The Draft Bill requires employers to report on the following:
1. The difference in average hourly and bonus pay for men and women;
2. The proportions of men and women receiving bonuses; and
3. The number of men and women in each of four pay categories.
The above categories of information mirror the categories of information which are required to be reported in the UK.
The Draft Bill envisages that the Human Rights and Equality Commission would have certain enforcement and compliance powers. It also proposes the creation of an offence for non-compliance by an employer with a scheme set up by the Human Rights and Equality Commission requiring employers to publish information relating to pay.
In the UK, the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 (“the UK Regulations”) require large employers with 250 or more employees to report on the gender pay gap in their organisation, on an annual basis, from April 2018.
Although in its early stages, the Draft Bill appears to be more burdensome than the UK Regulations in that organisations with more than 50 employees may be obliged to publish gender pay gap information.
It remains to be seen if gender pay gap reporting will become mandatory in Ireland in the coming years. Whether it does or not, it is advisable that employers be proactive and seek to address any gender pay gap within their organisation. It is important to note that disparities in pay between men and women can have legal and employee relations implications.
For more information on gender pay gap reporting, please contact a member of our Employment & Benefits team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.