Gender Pay Gap Reporting: Are you compliant?

The Irish Government introduced gender pay gap reporting legislation called the Gender Pay Gap Information Act in 2021. The Act applies to organisations with over 250 employees to publish information on their gender pay gap annually. It also includes provisions for reporting on bonuses, benefits in kind, and part-time employees.

Under the Gender Pay Gap Information Act, employers are required to report on:

1. Mean and median gender pay gap

Employers must calculate and report the mean and median hourly wage gap, the former reflecting the entire pay range in an organisation and the latter excluding the impact of unusually high earners.

2. Proportion of males and females in each quartile

Employers must report on the proportions of male and female employees in the lower, lower middle, upper middle and upper quartile pay bands.

3. Bonuses and benefits in kind

Employers must report on the proportion of male and female employees who received bonuses and benefits in kind and the mean and median values of these payments by gender.

4. Part-time employees

Employers must report on the proportion of male and female part-time employees and the mean and median differences in hourly pay between male and female part-time employees or those on temporary contracts.

Ensuring Compliance with the Employment Equality Act

Employers should review the following 5 items as they prepare to report on their gender pay gap:

1. Understand what must be reported under the Act.
2. Ensure systems/ software are in place which can produce the statistical data needed, e.g. payroll systems.
3. Calculate your pay gap and identify any equal pay risks giving rise to a gap.
4. Use data analytics to understand the root causes or why certain groups of staff are especially affected.
5. Develop your communication plan, e.g., sharing and discussing the data internally before going public.

Employers are obligated to publish all relevant information regarding their compliance with the Employment Equality Act on their own website, as well as submit the same to the Irish Human Rights and Equality Commission (IHREC), which is charged with ensuring that employers adhere to the Act. Failing to comply with these reporting requirements can result in severe penalties and costly fines.

How do organisations measure it?

Employers are required to select a specific date in June of the relevant reporting year as a reference point. This date serves as a “snapshot” for the remuneration data. After selecting the snapshot date, employers have a maximum of six months to prepare their calculations. The reporting deadline is set six months after the snapshot date, allowing employers sufficient time to compile and submit their remuneration data.

Please be aware that the remuneration data used in calculations will accurately represent the employees’ compensation over a 12-month period prior to the chosen snapshot date. As for reporting deadlines, they may differ for each employer based on their selected snapshot date.

As a payroll provider that develops and maintains its own payroll software, Jefferson Payroll  can assist in providing you with accurate and relevant information required for the snapshot date in question once we have up to a year’s data on our systems.