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The delayed Gender Pay Gap deadline is fast approaching. Are you prepared? In this guest blog, pay gap specialists, Spktral, share the top three things you need to consider.

It’s been a difficult year for HR teams, and from our conversations with clients, we know that Gender Pay Gap reporting has slipped off the agenda for many employers. We believe that analysing and reporting your diversity data is integral to the long-term success of your business. We understand that when resources are tight, you have to prioritise. That’s where we can help: we take the headache out of pay gap analysis and reporting, freeing up your resources to focus your time and resources on other aspects of your business. Read on to discover the more important things you need to know ahead of the Gender Pay Gap reporting deadline.

Important dates for your diary

  • 4th October 2021 - The deadline to submit your 2020 Gender Pay Gap report. We have seen confusion around the exact date. The Equality and Human Rights Commission have confirmed they will start enforcement action against employers failing to report their Gender Pay Gap on 5th October 2021, so make sure you submit your report before then!
  • 4th April 2022 - The deadline to submit your 2021 Gender Pay Gap report. This may seem like a long way off, but you should start as soon as possible. Take this opportunity to be transparent about your situation before implementing action plans to change systems, processes, or people that will speed up progress towards optimal representation in your workforce.

Furlough

Earlier this year, the Government Equality Office (GEO) confirmed that furlough is a form of leave. You may know that the group of employees used to calculate your pay gap and your pay quarters is called your ‘Full-pay Relevant Employees’. To be excluded from this key group, a Relevant Employee must have reduced pay or zero as a result of leave. Prior to 2020, the most common reasons to be excluded were long-term sick leave and maternity/paternity/parental leave (after any initial period where many organisations pay full rate). Now, you should add Furloughed Staff to this definition, if you are not topping them back up to 100 per cent.

We know this might seem a bit technical, so here are a couple of examples to clarify:

Jenny

  • Was an employee on 5th April 2020
  • Wasn't an Equity Partner in a firm
  • Was Furloughed on 3rd April 2020, but her company topped up her 80% furlough grant to 100% of her normal monthly salary

Jenny is a full-pay relevant employee and is featured in both the bonus and pay gap aspects of the report.

John

  • Was an employee on 5th April 2020
  • Wasn't an Equity Partner in a firm
  • Wasn't any kind of Partner in a firm
  • Was Furloughed on 15th April 2020, usual monthly salary had been £4,500 up to the end of March 2020, but the company didn't top up his pay, so he received the lower of £2,500 or 80% normal salary = £2,500

John is therefore NOT a Full-pay Relevant Employee because he received less than £4,500 and will only count towards:

  • employee headcount
  • gender bonus ratio
  • gender bonus gap

Crystal clear? Hopefully these examples demonstrate the process you can follow.

You may find that once you have funnelled your employees in this way, the number of employees to be included in the report has been drastically reduced. One of our clients had some of their workforce furloughed with reduced pay during the snapshot date. To get a more accurate picture of the male/female representation in their workforce, we used our software to perform a ‘what if’ scenario by topping all furloughed employees back up to 100 per cent. We helped them analyse the two scenarios and posed some questions:

Have we made biased decisions on who to furlough?
Are we putting pressure on specific types of people / job roles?

Having this extra analysis helps you narrate what your figures would have been without furlough, before describing what they are due to furlough.

Action plans

Another new addition to the GEO’s guidance on Gender Pay Gap reporting is to include an action plan. This is not mandatory, but is advised. The supporting narrative can run throughout the report to explain your view on why gender pay gaps exist in your organisation and what you’ve done so far to change that.

Publishing your action plan is a very public commitment to improving your gender pay gap. This is important, but remember if you are going to talk-the-talk in your pay gap report, make sure you walk-the-walk by making real improvements for your employees.

Your future

Once you publish your 2020 Gender Pay Gap results you might be relieved that it is ticked off your list until March when you start to think about the next deadline. Don’t stop here! As shown in the image below, the optimum time to analyse your Gender Pay Gap is May - July.

Why waiting until close to the deadline to look at your data, you have nine months of inaction when you could have been using the insights from your data to make better people decisions, build trust, increase transparency and engage talent.

Don’t stop at gender. Ask yourself: what is our strategy for analysing other protected characteristics?

In July the Government announced that:

  1. They will debate mandatory Ethnicity Pay Gap reporting in September.
  2. A billion pound package of support for disability inclusion includes funding for a consultation into mandatory disability workforce reporting.

If made mandatory, both will require a roadmap to collect, analyse, report and communicate your data. This requires more thought and resource than Gender Pay Gap analysis and reporting does.

You should consider whether you have the expertise and resources to do this internally, or whether it makes more sense to seek specialist support to take the guesswork headache out of this process.

Make better people decisions with your diversity data

Do you need help to meet the Gender Pay Gap deadline? Would you like to discuss your strategy to analyse additional protected characteristics? Simply have a quick question about the Gender Pay Gap legislation? Spktral are offering you a complimentary consultation with one of their specialists. To book, visit Spktral’s website, or contact carol@spktral.com.


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