As you will be aware, the following employers will have a statutory obligation to declare their Gender Pay Gap information on the Government Website...
View the Government Website.
- By 04 April 2018, all private and voluntary sector employers with 250 or more employees in Great Britain
- By 30 March 2018, all listed public sector employers with 250 or more employees in England
This is an on-going annual obligation and the dates listed above refer to the first statutory deadlines. Whilst there are no civil penalties for non-compliance, failing to publish is regarded as an ‘unlawful act’ and falls within the enforcement powers of the Equality and Human Rights Commission (EHRC).
The EHRC have now set out their draft enforcement plans as part of their statutory powers.
A legislative background
I will not bore you too much with all the legislation, save to say that the statutory enforcement powers all stem from the Equality Act 2006 that applies in Great Britain.
The 2006 Act allows these powers to be used against non-compliance with the Equality Act 2010. The Regulations that imposed mandatory GPG reporting on the above employers all stem from the 2010 Act. Therefore, the EHRC plan to use their 2006 enforcement powers against non-compliance with anything that stems from the 2010 Act.
However, the EHRC do not have any enforcement powers on issues that have been devolved to Scotland and Wales. Therefore, the enforcement action will not apply to GPG reporting in the public sector under:
- The Equality Act 2010 (Specific Duties) (Scotland) Regulations 2012 (as amended) or
- The Equality Act 2010 (Statutory Duties) (Wales) Regulations 2011
First and foremost, the EHRC document is clear that they want compliance with the private and voluntary sector (Great Britain) and the public sector (England) GPG requirements. They are / will achieve this through a range of measures such as:
- Promoting awareness
- Education, for example on the Website
- Monitoring compliance with the Government Equalities Office and
- Publicising compliance rates before taking enforcement action
Therefore, compliance, informal action and cooperation are highly preferred before using the enforcement powers afforded under the 2006 Act.
In the document, the EHRC says that there are two reasons that they will use their enforcement powers:
- To encourage non-compliant employers to publish the information, and
- To ensure employers who breach GPG reporting are held to account in order to deter non-compliance by other employers
The EHRC say that they define enforcement action as using any of their statutory powers under the 2006 Act. Briefly, these are:
Means of Enforcement
This is the preferred option and not covered by the legislation.
Where an employer does not comply with their GPG reporting obligations, the EHRC will write to them after the relevant reporting date that they have missed. This will require the employer to acknowledge the letter and assure that reporting will be done within 42 days and will be on time in the next year.
This will be under Section 20 of the 2006 Act for private or voluntary sector employers.
Where the employer does not comply at the informal stage, EHRC will carry out an investigation into whether an unlawful act has been committed – i.e. failing to report on time. A non-compliant employer needs to be aware that failure to take part in an investigation could lead to a fine.
This will be under Section 23 of the 2006 Act for private or voluntary sector employers.
As part of the above investigation, EHRC will ask whether the employer wants to halt the investigation with the assurance that they will report within a certain time and will report on time the following year. If the employer does enter into such an agreement, EHRC will monitor to ensure that the terms of the agreement are adhered to.
This will be under Section 24 of the 2006 Act for private or voluntary sector employers.
Where the employer does not fulfil the agreement (above), EHRC will apply to the county court in England and Wales or the sheriff court in Scotland for an order. The resulting court order will require the employer to adhere to the Section 23 agreement.
Unlawful Act Notices and Action Plans
These will be issued under Sections 21 and 22 of the 2006 Act respectively for private or voluntary sector employers.
If the result of the investigation (Section 20) and / or an agreement (Section 23) is that the employer has committed an unlawful act by not reporting, an unlawful act notice will be issued. This will require the employer to submit an action plan detailing how they will rectify their current breach of GPG reporting and prevent future breaches.
Failure to produce an action plan could result in court action.
Public Sector Duty Assessments and Public Sector Duty Compliance Notices
These will be issued under Sections 31 and 32 of the 2006 Act respectively for public sector employers in England.
Essentially, a Section 31 assessment is the same as a Section 20 investigation that applies to private or voluntary sector employers in Great Britain. The Section 32 compliance notice is along the same lines as the order, notices and action plans (24, 21 and 22) above.
Public sector employers in England will be offered the same opportunity as private and voluntary sector employers in Great Britain to enter into a section 23 agreement as an alternative to a section 32 compliance notice.
Enforcement action is coming and, simply, employers need to prepare and publish their GPG information before the deadline.
EHRC have the power to publish details of their enforcement action and no employer wants to appear on breakfast television as one that has been non-complaint, named and shamed.
Have your say
The above enforcement plans are draft only. There are available for comment until 02 February 2018 and I would encourage employers with an interest in the planned enforcement action to make their voices heard.