Gender pay issues have gathered intense media scrutiny and public interest over the past year. The #MeToo and TimesUP movements have given significant momentum to driving a cultural shift towards a desire for pay transparency in the workplace.
Unlike many other European jurisdictions, there is currently no Irish legislation governing gender pay transparency in Ireland. That is set to change by the end of this year if the government meets its target for implementing planned new legislation.
What is the gender pay gap?
The gender pay gap is the difference between what women in aggregate are paid, compared to men. The gender pay gap can be distinguished from the concept of equal pay between males and females for performing equal work.
Why does it matter?
Closing the gender pay gap is a key to promoting inclusivity and in attracting and retaining talent. It is also good for business. Recent research has confirmed that gender diversity at senior level has a significant impact on productivity growth and on returns to investors.
What is the current status in Ireland?
Cabinet has this week approved legislation to compel employers to report the gender pay gap in their organisations.
The general scheme of the Gender Pay Gap Information Bill will initially require publication of gender pay data in both public and private sector entities with over 250 employees. The threshold will gradually fall to just 50.
Employers will be required to publish differences in hourly pay, bonus pay, part-time pay and pay of men and women on temporary contracts. Publication of differences in pay by reference to job classifications may also be required.
The enforcement provisions will permit the Irish Human Rights and Equality Commission to apply to the Circuit Court for an order requiring an employer to comply with the legislation. An employee of the employer concerned may apply to the Workplace Relations Commission for an order requiring compliance.
Designated officers may also be entitled to investigate a sample of employers to ensure that the information published is accurate.
The general scheme of the Bill will now be submitted to the Joint Oireachtas Committee on Justice and Equality for pre-legislative scrutiny. The precise mechanisms to collate and process gender pay data and the penalties for breach are yet to be determined.
What can be done to prepare?
Below are some suggested steps that employers can take to help prepare for gender pay reporting.
Step 1 – Gender pay audit: A mock gender pay audit is a key first step to identify the pay gap in your organisation. This will include an assessment of all employees’ hourly rates of pay, salary bands, job classifications and grading structures, bonus and incentive arrangements, and part-time/ fixed term status.
Step 2 – Identify the gaps and determine the cause: Where pay gaps are identified, the next step is to consider the reasons for this. The reasons may not be discriminatory but could be attributable to reasons including a lack of representation of women at senior level and socio-economic factors.
Step 3 – Reduce the gap: Armed with an understanding of the existing pay gaps and the reasons for those gaps in your business, opportunities for reducing the gap may now be identified. These may include -
- Effective monitoring of starting salaries, pay progression, career progression, retention, promotions, and flexible working and family leave arrangements at all levels of seniority in the business.
- Ensuring an operational structure that enables progression to senior level with flexible working arrangements in place.
- Reviewing policies and addressing workplace culture to ensure that men are encouraged to avail of paternity, parental and flexible working arrangements.
- Implementing training programs to promote gender diversity and to tackle unconscious bias.
Co-authored by Alice Duffy, Senior Associate in the Employment Practice.