UK: further gender pay gap reporting guidance but no imminent change to requirements

As the second deadline for reports approaches, the Equalities and Human Rights Commission has published a report urging employers to accompany their figures with narrative reports and action plans with concrete, time-bound target-driven activities to reduce the gap. The report highlights ideas for action and recommends employers to refer to the Government Equalities Office evidence-based guide on practical steps to close the gender pay gap (discussed in our blog post here).

The Government has also published its formal response to the House of Commons BEIS Committee's report (see our blog post here) on gender pay gap reporting, clearly signalling that it is not planning any immediate changes to the regime and will await the statutory review scheduled for 5 years post-implementation.

With regard to the Committee's main recommendations, the response indicates that:

• The reporting obligations will not be extended to companies with 50 or more employees, but the Government will encourage smaller companies to look at their gender pay gaps and may consider revisiting this issue in future.
• It will not make action plans mandatory, as it thinks this might result in a prescriptive format with limited value.
• Partner remuneration will remain excluded from the reporting regime, although guidance may be altered in the future to introduce a voluntary reporting methodology.
• The Government will not amend the regulations to require a more nuanced analysis of gender pay gap figures (eg requiring pay deciles rather than quartiles and showing part-time and full-time gender pay gap statistics separately) at this stage – it notes that it would need to consult before considering such amendments.
• The Government will not be revising the Acas/GEO guidance but will continue to gather stakeholder feedback on it and update it if appropriate.
• The Government will not be changing its position that pro-rated bonus payments should not be used in the calculations, as this would fail to expose where earnings differ on account of working patterns, which it notes is a key contributing factor to the gender pay gap.
• The response does not commit to any timescale for ethnicity pay gap reporting (on which consultation has just ended) and does not indicate any intention to extend mandatory reporting to disability.
• The Government does not see any need to enhance the EHRC's enforcement powers but will continue to monitor this.
• The Government does not intend to set mandatory targets for specific sectors.