Gender Pay Gap Information Act 2021 - What does it mean for SMEs?
Posted on 22nd July 2021 at 16:52
After several stages of debate, the (short) Gender Pay Gap Information Act 2021 (Act) was finally signed into law on 13 July 2021. The aim of the Act is to provide transparency on the gender pay gap (GPG) in Ireland and to incentivise employers to narrow any gaps. The Act itself does not contain gender pay gap reporting obligations however it does create the power for the Minister for Justice to make regulations mandating employers to report GPGs.
Will this Act apply to SMEs?
The reporting obligations are to be implemented on a phased basis. To begin with, SMEs will not be affected as only organisations with 250 or more employees will be required to report their GPG. However, from the second anniversary of the regulations, employers with 150 or more employees, will be affected. From the third anniversary of the regulations, the scope of the reporting obligation will be extended to organisations with 50 or more employees, catching many SMEs. Though the regulations will not apply to employers with less than 50 employees.
What will the reporting obligations be?
The Act provides that regulations may be made by the Minister for Justice prescribing that the following information be reported:
• The mean and median hourly pay of male and female employees
• The mean and median bonus pay of male and female employees
• The mean and median pay of part-time male and female employees
• The mean and median pay of employees on temporary contracts
Employers are also likely to have 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 reasons as to why any GPG exists, as well as detail any measures they have taken, or propose to take, to eliminate or reduce the gap.
When will the reporting process begin?
It has been indicated by the Department of Children, Equality, Disability, Integration and Youth that the reporting process will begin in 2022.
Will the data be published?
Yes, the Act envisages the publication of the data, however the form, manner and frequency of such reporting and publication has yet to be confirmed.
Are there consequences for non-compliance?
The Act does not include any compensation or monetary fines for non-compliance. However, employees may bring claims against their employers to the Workplace Relations Commission (WRC) in respect of non-compliance with the Act. The Director General of the WRC or an Adjudication Officer may then make an order requiring an employer to take a specified course of action to comply with the Act. There is also scope for the Irish Human Rights and Equality Commission to apply to the Circuit Court or the High Court for enforcement orders.
What are the next steps?
It is difficult for employers to fully prepare until they have clarity as to what will be included in the regulations. However, it is important to remember that although there are no monetary sanctions contained in the Act, reporting of the GPG will be important for an organisation's reputation, attracting talent, retaining staff, appealing to customers and may, in time, become a common question asked by new clients or during the procurement phase for public contracts.
In the meantime, affected employers, should begin to consider how they will compile the data and ensure that that they have appropriate technology systems to capture appropriate data.
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This briefing is for general guidance only and should not be regarded as a substitute for professional legal advice. Legal advice should always be taken before acting on any of the matters discussed.
Tagged as: Gender Pay Gap Information Act 2021
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