Mandatory gender pay gap reporting to be introduced

The Small Business, Enterprise and Employment Act which came into force last month requires the Government to introduce, within the next 12 months, regulations making reporting of gender pay information mandatory for companies with 250 or more employees. Currently there is a voluntary reporting system in place. Under this voluntary scheme, we understand that only 5 companies have made a report on the difference in pay between male and female employees.

It remains to be seen how the regulations governing the new mandatory scheme will be drafted. Details in relation to the timeframe, detail and format for the disclosures is therefore not yet known. There is a proposal that a failure to comply could result in a fine of up to £5,000.

Mandatory gender pay reporting is not entirely new. Since October 2014, tribunals have had the power to order employers who lose an equal pay claim to produce a pay audit. The new rules however will be much more far reaching, covering all larger employers.

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