From 31st March all NHS Trusts will have to begin implementing new rules that dictate recording of gender pay differentials within public services. HCSA National Officer Ro Marsh looks at how it will work in practice.
What is “gender pay gap reporting”?
Everyone will have heard of “equal pay” and may be aware that this was first enshrined in law in the 1970 Equal Pay Act, led by Barbara Castle, who was the Secretary of State for Employment.
“Equal pay” deals with pay differences between men and women carrying out the same or similar jobs, and unequal pay has been illegal in this country since the 1970 Equal Pay Act. However, it was realised that women are often clustered in lower paid jobs or are unable to progress through a pay scale because of the “glass ceiling.” So, even though there may be no apparent equal pay anomalies, men are often paid a lot more than women when measured across the whole organisation.
The 1970 Equal Pay Act, which was incorporated into the 2010 Equality Act, did not allow any legal challenge against this, nor require employers to seek to redress it, as equal pay claims require a “comparator” of someone doing the same or similar job.
So, the “gender pay gap” differs from “equal pay” as it is concerned with differences in pay between men and women across all the roles in an organisation. Organisations who have a high level of men in senior jobs with women clustered in junior roles are more likely to have a “gender pay gap”.
Public Sector Equality Duty
Employers have a requirement to publish equality data and consider the impact of their policies and procedures under the Public Sector Equality Duty (PSED) (Section 149 of the 2010 Equality Act) which requires public authorities to:
- Eliminate discrimination, harassment, victimisation and any other conduct that is prohibited by or under the Equality Act 2010
- Advance equality of opportunity between persons who share a relevant protected characteristic and persons who do not share it; and
- Foster good relations between persons who share a relevant protected characteristic and persons who do not share it
Many, but not all, employers already publish gender pay gap data under this requirement. The Government has now decided to make this into a mandatory duty for all employers covered by the 2010 Equality Act.
The Government has now published the regulations which require all public sector bodies in England, including NHS Trusts, to report on their “gender pay gap”. These come into force on 31st March 2017.
For the private sector, the regulations come into force on 6th April 2017.
The Trades Union Congress (TUC), to which HCSA is affiliated, was formally consulted on these proposals and met with the Government Equalities Office (the Government body which is drawing up and implement these regulations) to talk about how the regulations will be implemented.
The requirement is being imposed under the auspices of the 2010 Equality Act and extends the PSED to require the publication of annual gender pay gap reports. This applies to all public sector employers in England who employ more than 250 staff. Different regulations apply to private sector employers in England, but they are also required to publish this information.
Employers in both private and public sectors will be required to publish the following from next year, so will need to start collecting this data now:
- The difference between the mean average hourly rate of pay for males and females, expressed as a single percentage
- The difference between the median average hourly rate of pay for males and females, expressed as a single percentage
- The difference between the mean average bonus pay for males and females, expressed as a single percentage
- The difference between the median average bonus pay for males and females, expressed as a single percentage
- A bonus eligibility statistic, expressed as a single percentage for men and women (i.e. 2 figures)
- A quartile representation, showing the proportions of males and females in each of the four pay quartiles
The rest of the UK
Although these regulations only apply to England, the other nations have already incorporated the requirement, or are planning to do so.
Scotland: Scotland already has the requirement enshrined in the regulations it drew up to implement the Public Sector Equality Duty. The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012, as amended, impose a “duty to publish gender pay gap information” for the public authorities – eg the Scottish Administration, local government, police forces and educational bodies. There are also a number of other duties imposed, such as the requirement to produce “mainstreaming” reports and information on “occupational segregation.” These apply to all public authorities employing more than 20 people and good guidance appears on the Equality and Human Rights Commission (ECHR) Website.
Wales: The Equality Act 2010 (Statutory Duties) (Wales) Regulations 2011 do not impose strict reporting obligations. However, public authorities in Wales must have “due regard” as to the levels of pay for men and women under their PSED. This applies to public authorities employing more than 150 people. Where a gender pay difference is identified within the authority, they must publish an “equality objective,” designed to address the reason for the gap. Alternatively, they could publish their reasons for not publishing such an equality objective.
Northern Ireland: The Equality Act 2010 does not apply to Northern Ireland. However, Section 75 of the Northern Ireland Act 1998 broadly imposes a PSED. As well as having “due regard” to the protected characteristics as detailed in the Equality Act, this is extended to cover different religious beliefs. With regards to pay, the Section 75 PSED in Northern Ireland obliges public sector authorities to collect pay data for equal opportunities monitoring for all relevant employees. However, this is not generally published unless an equality impact assessment is performed by the Equality Commission for Northern Ireland (ECNI). There is guidance on Section 75 duties on the ECNI website.
Channel Islands: The Channel Islands are not part of the United Kingdom, so these requirements do not apply, and neither does the 2010 Equality Act. However, Jersey has incorporated protection according to the nine “protected characteristics” within the 2010 Equality Act, and it may be that, since the HCSA is recognised, we will be able to persuade the employers of the good practice around publishing gender pay gap data.
The Advisory, Conciliation and Arbitration Service (Acas) has published guidance and fact sheets for private sector, voluntary and public sector employers, as the regulations are approved by Parliament.
It is apparent that many employers are not alert to this new requirement, despite the fact that they soon have a mandatory duty to collect this data, so that they can publish the first results in March 2018. The HCSA will be urging the NHS Employers to notify Trusts of this new requirement and to provide guidance and advice. Information and guidance is published on the NHS Employers website and they have already indicated that they will be working with the NHS Staff Council Equality and Diversity Group.
The involvement of Trade Unions
The TUC, in its response to the consultation, called on employers to ensure that the data is shared with trade unions, stating that this would “enable employers to better understand the causes of the gender pay gap and it will enable them to develop effective actions for narrowing them.”
The HCSA will seeking to work with other unions and with NHS Trust management to help with the collection of the data, and to consider all the data once it is published. The aim will be to work with Trusts to review how people are paid and to understand the reasons behind any identified gender pay gap so this can be considered in a fair and non-discriminatory way with the aim to reduce the gap.