Fines and Convictions for Companies Which Fail to Report on Gender Pay

More than 1,500 employers could face investigation and an unlimited fine for failing to report their gender pay gap figures before the legal deadline on April 4th.

New regulations require all companies, public sector groups and charities with over 250 employees to submit an annual report detailing average hourly employee earnings across all levels of the organisation, broken down along gender lines.

The Equalities and Human Rights Commission (EHRC) has said it will now send letters to the 1,557 non-complying firms to remind them of their legal obligations.

Firms that do not respond within 28 days will be subject to an enforcement process, with terms of reference for the enforcement process to be published.

According to its policy, the EHRC is empowered to investigate non-reporting employers for regulatory breaches and seek formal agreement from employers to comply and thus avoid further investigation.

If employers do not respond or agree to these calls for compliance, the EHRC may issue unlawful act notices and court orders, and ultimately can seek summary convictions and unlimited fines for employers who do not comply with a court order.

Pay gap reporting “is the law, not an option”

Rebecca Hilsenrath, EHRC chief executive, said that the Commission was overall pleased with the high levels of timely reporting, but underlined that the new deadline for reporting was a legal requirement, with consequences for non-compliance.

“It is the law, it’s not an option. It is the right thing to do, and we will be enforcing against all those organisations which failed to meet the deadline,” she said.

Meanwhile, the Parliamentary chair of the Women and Equalities Select Committee, Maria Miller MP, has said that she will be requesting monthly follow-up reports from the EHRC to ensure that sufficient action is being taken against all non-reporting employers.

“I will want to make sure that any companies that haven’t complied are taking the appropriate action and that this issue is not simply kicked into the long grass,” Miller said.

Over 10,000 employers have filed their reports, with over 1,000 completing their submissions on the last day of the deadline.

Employers must look at “tackling bias,” says EHRC

Compliant employers will also have to work to combat any gender pay disparities moving forward, with the EHRC’s Hilsenrath adding:

“We want them to look at their flexible working practices, we want them to look at tackling bias, conscious and unconscious, and we’re looking to them to address instances of pregnancy and maternity pay discrimination.”

Results of reporting companies are published on the government’s online gender pay gap service search engine, which allows users to search for any reporting company’s results by name, size and sector.

Amongst employers who failed to meet the deadline was the Unite union, which published its figures a few hours shy of the deadline. The union’s late results revealed a 29.6% gender pay gap between men and women, despite the union being heavily involved in working “at the forefront of the trade union campaign to achieve equal pay,” in its own words.

Over three-quarters (78%) of responding companies reported a gender pay gap between women and men, with men earning a median of 9.7% more than women. Meanwhile, 8% of firms reported no gender pay gap at all, whilst 14% of employers filed a median gender pay gap in favour of women – paying female employees more.

The Office of National Statistics reports the UK’s median gender pay gap – factoring part time as well as full time employment – to be 18.4%

Although unequal pay – whereby men are paid higher wages than women for the same jobs – has been illegal since 1970 under the Equal Pay Act (and now under the Equality Act 2010), indirect gender discrimination – via firms employing more men at higher levels of the company, or deeming women to be less experienced than male counterparts – is most likely what gender pay gap figures reflect.

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