The much-anticipated text of the Government’s Gender Pay Gap (GPG) Information Bill 2019 has now been published.

In amending the Employment Equality Acts 1998-2015, the purpose of this Bill is to require regulations to be made that will oblige certain employers to publish information relating to the gender pay gap (“GPG”) among their employees and, where there is a gap, the measures (if any) being taken to eliminate or reduce it.

 

The Bill demonstrates the Government’s commitment to reducing the gender pay gap in Ireland which currently stands at 13.9%. The Bill provides that the Minister for Justice and Equality shall make additional regulations that will require certain Irish employers to report and publish details of both their GPG and gender bonus gaps. In addition employers will also be required to publish the reasons, in the employer’s opinion, for any gaps and of the measures (if any) that the employer is taking or proposes to take to eliminate or reduce gaps.

 

The Bill provides that the Minister shall, as soon as is reasonably practicable after commencement, make regulations requiring the publication of GPG information.

The information is specified:

• The mean and median gap in hourly pay between men and women
• The mean and median gap in bonus pay between men and women
• The mean and median gap in hourly pay of part-time male and female employees
• The percentage of men and of women who received bonus pay
• The percentage of men and of women who received benefits in kind.

 

It is envisaged that the reporting requirement will be introduced on a phased basis beginning with companies who have 250 employees or more and working its way down to companies with 50 employees or more. The Bill also states that complaints relating to GPGs can be made to the Workplace Relations Commission.

 

 

European Approach

 

The UK introduced its mandatory GPG reporting regime since 2017 and other European countries have recently followed suit.  In September 2018, France introduced new legislation obliging employers with 50 employees or more to annually publish information on GPGs and what measures are being taken by employers to narrow those gaps. Significantly, where an employer’s “equal pay rating” is below a specified threshold for three consecutive years, a financial penalty may be triggered.

 

The UK legislation gave companies with 250 employees or more one year to publish a GPG report. According to the UK Equality and Human Rights Commission report ‘Closing the Gender Pay Gap’ published in December 2018, all organisations subject to the regulations had published the relevant data by 1 August 2018 (and 94% had done so by the deadline for submission- 4 April 2018). Over three-quarters (77%) of organisations reported a median gender pay gap in favour of men; 14% in favour of women; and in 9% of cases there was no reported median gender pay gap. However, the report noted that only half of the reports published were accompanied by the required narrative explaining the reasons for the GPG and outlining the commitments to closing this gap.

Portugal has also recently passed legislation in an effort to address its 17.5% GPG. The legislation requires employers with 250 or more employees to submit an annual report of their GPG, issue proposals for narrowing the GPG and to publish details of the salaries of their male and female employees. Portugal’s legislation also provides for penalties for non-compliance which include a two year ban on tendering for public contracts.

 

 

How should Irish employers prepare for the introduction of the Bill?

 

There are a number of practical steps employers should be taking now to get their house in order before the Bill becomes law. We are advising employers to carry out a trial run audit and we are engaging with our clients to identify and mitigate any equal pay or discrimination issues to ensure compliance with data protection principles. Should the trial run reveal a significant gap, employers should try and identify the causes of the gap and take action where possible.

 

 

Conclusion

 

The Minister for Justice and Equality recently commented that “the aim of this Bill is to provide transparency on the gender pay gap” and expressed a hope that mandatory reporting “will incentivise employers to take measures to address the issue insofar as they can”. The precise timeframe for when the Bill will become law is unclear. The Bill will now be debated before both Houses of the Oireachtas, following which amendments may be made.  However, while the Bill itself may come into law before the year is out, the timeline for the Minister’s regulations (to be made “as soon as reasonably practicable after the commencement” of the legislation) remains unclear.