Imagine you are a business leader in the UK heading into 2021. You have a lot to consider as the new year dawns. There are new rules for businesses that are part of the Brexit transition. There is the continued reality of a global pandemic and its economic effects. And there is also the fast-approaching deadline for submitting UK gender pay gap reports (March 30, 2021 for most public employers, and April 4, 2021 for private employers). In anticipation of this deadline, the government published a collection of gender pay gap reporting guidance on December 14, 2020.
As a refresher, if your organization has 250 or more employees, you must comply with the gender pay gap regulations under the UK Equality Act of 2010. (The reporting obligation was suspended in 2020 as a result of the pandemic). The gender pay gap calculations included in the required reports are based on employer payroll data drawn from a specific date each year (the “snapshot date”). Covered employers must calculate and report on the following data points:
Their mean gender pay gap
Their median gender pay gap
Their mean bonus gender pay gap
Their median bonus gender pay gap
The proportion of men in the organisation receiving a bonus payment
The proportion of women the organisation receiving a bonus payment
The proportion of men and women in each quartile pay band
The guidance collection covers four major elements of gender pay gap reporting compliance. The first section (“who needs to report their gender pay gap”) covers which employers must report, which regulations they must follow, the types of employees that must be included, as well as those employers that wish to submit a voluntary report. The second section (“The gender pay gap information employers must report”) provides information for employers about the gender pay gap figures you must report, how and when to report them, as well as the inclusion of a supporting narrative and action plan. The third section (“The gender pay gap data you must gather”) addresses the types of data that must be reported, including a to-do list to help employers gather the necessary data to make their gender pay gap calculations. Finally, “making your gender pay gap calculations” includes a step by step guide for making each of the required gender pay gap calculations. All in all, this new collection of guidance is an essential resource and comes as a critical time for UK businesses.
As a footnote to the upcoming UK gender pay gap reporting deadline, employers in California must also keep pay data reporting in the front of their minds for 2021. Following the signing of California Senate Bill 973 (“SB 973”) into law on September 30, 2020, mandatory California pay data reporting will take effect on January 1, 2021. The new requirements under SB 973 are positioned to have far-reaching implications for pay equity and pay data reporting both in California and beyond.
Conducting a pay equity audit is a key component to ensuring equitable compensation within your organization. Just as important as the analysis is how you communicate findings and progress with various stakeholders. Download The Pay Equity Communications Planner to learn best practices for discussing compensation, both internally and externally.