Narrowing the Gap – Gender Pay Gap Reporting set to Become Law

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Narrowing the Gap – Gender Pay Gap Reporting set to Become LawMandatory gender pay gap reporting is set to become a legal requirement in Ireland.

On 7 July 2021, the Gender Pay Gap Information Bill 2019 (the Bill) passed through both houses of the Oireachtas and has now been sent to the President for consideration and to be signed into law.  Once enacted, it will be referred to as the Gender Pay Gap Information Act 2021 and will require employers to publish details on the pay differences between male and female employees.

Aim

The aim of the Bill is to provide transparency on the gender pay gap (the GPG) in Ireland and incentivise employer measures to narrow the gap.

Reporting Obligations

The Bill requires employers to report the mean and median hourly remuneration for part time and full time male and female employees.  It also requires employers to report on mean and median bonuses of male and female employees, and the percentages of men and women receiving bonuses and benefits in kind.

Employers will be required to provide an explanation of any GPG arising in their report and detail any measures they are, or propose taking, to take to address the gap.

Who Does it Apply to?

The reporting obligations will be implemented on a phased basis.  Initially, organisations with 250 or more employees will be required to report on their GPG and after three years the scope of the reporting obligation will be fully extended to organisations with 50 or more employees.

Minister for Children, Equality, Disability, Integration and Youth, Roderic O'Gorman, stated that "with 65% of all employees in the State estimated to fall within the scope of the regulations, the publication of gender pay gap information will provide a range of data about firms and sectors and how they contribute to the gender pay gap in the economy as a whole".

Sanctions for Non-Compliance

While no compensation or monetary fines are detailed in the Bill, the Director General of the WRC or an Adjudication Officer can make an order requiring the employer to take a specified course of action to comply with the Bill. This is the only remedy that may be ordered.  The Irish Human Rights and Equality Commission (IHREC) may apply to the Circuit Court or the High Court for enforcement orders and employees can bring claims against their employers to the Workplace Relations Commission (WRC), in both cases in respect of non-compliance with the Bill.

What Should Employers Do Now?

The Department of Children, Equality, Disability, Integration and Youth has indicated that the reporting process will begin in 2022.  Such reports will be important for an organisation's reputation, recruitment processes, retention of staff, and client and customer expectations.

Irish employers should consider their internal procedures and mechanisms to ensure they will be in a position to comply with GPG reporting obligations.  Employers should ensure that they have the sufficient technology in place to capture the necessary data and assign this new workflow to internal channels within the organisation.  Employers should also seek to assess at any early stage whether a GPG exists in their organisation, and if so, consider steps on how to reduce it.  Reviewing existing HR policies on recruitment and promotion to see if any unconscious bias exists is also a good preparatory step.   Seeking early advice on compliance with GPG obligations is recommended.

By Eimear O'Leary & Georgia Collins of William Fry.