by Breda O'Malley September-01-2021 in Employment Law

The European Commission 2019 Report on Equality between Women and Men in the EU concluded, “the reality is that even in the EU, where unequivocal gender equality is secured by law, equality between women and men is still not a tangible reality for too many. While the gender gap in education is being closed and even reversed, this does not yet yield true gender equality at work in the EU countries.”

It is somewhat of a stark situation that legislation is still needed to address the imbalances between men and women in the workplace.  The latest piece of legislation, addressing the issue, is the Gender Pay Gap Information Act 2021 (“the Act).

What is the gender pay gap?

The gender pay gap is the difference between the average gross hourly pay of men and women within an organisation regardless of occupation or level of seniority.

What are the reasons for the gender pay gap?

The gender pay gap is not about equal pay.  Equal pay is paying men and women the same for the same work or, work of equal value.  The gender pay gap exists due to other factors.

There are multiple reasons why such a gap exists, traditional male and female dominated occupations; caring responsibilities not being equally divided between the sexes; women being more likely to have career breaks or work part-time, all of which contribute to women receiving less pay than men and consequently, not progressing to senior roles that pay more.  The implications of this for women is less income to save and invest, putting women at a higher risk of poverty and social exclusion at an older age.

The Gender Pay Gap Information Act 2021

The Act was signed into law on 13 July 2021. The Act will require employers to report on the pay differences between female and male employees, including any bonuses and benefits in kind.

The reporting obligations under the Act have yet to commence but, will do so once the Minister for Justice and Equality makes Regulations required under the Act.

What employers are impacted by the new legislation?

The Act will impose reporting obligations on employers with over 250 employees once Regulations are put in place.  Reporting obligations are likely to start in 2022 and will be extended to include employers with over 50 employees, on a phased basis, over 4 years.

Employers with less than 50 employees will not be impacted.

What will the reporting obligations involve?

The Minister for Justice and Equality is required to make Regulations requiring employers to publish information relating to the pay of their employees, for the purpose of showing whether there are differences in such pay referable to gender and, if so, the size of such differences.

The information required includes:

  • the mean and median hourly pay between women and men;
  • the mean and median bonus pay between women and men;
  • mean and median hourly pay between women and men who work part-time; and
  • the percentage of all men who were paid a bonus and received benefits in kind compared to all women.

Employers must explain the reasons for such differences, and the measures (if any) being taken, or proposed to be taken, to eliminate or reduce such differences in pay due to gender.

The Regulations may go further to include:

  • The classes of employer (whether by reference to the number of employees);
  • The classes of employee and pay;
  • How the number of employees and pay is to be calculated;
  • The way the information is to be published, to bring the information to the attention of the employees to whom the information relates and the public;
  • The publication of the percentage of male and female employees in each of the four (lower, lower middle, middle and upper) quartile pay bands;
  • The publication of information by reference to job classifications.

What happens if an employer fails to comply with its obligations under the Act

It is open to employees to bring claims against their employers to the Workplace Relations Commission (WRC) in respect of non-compliance with the Act. 

The Director General of the Workplace Relations Commission shall investigate the complaint, if they consider that an investigation is warranted. 

The Director General can make an order requiring the employer to take a specified course of action to comply with the Act.  The Act does not provide for the employee to be compensated or, for fines to be imposed on the employer.

It is possible for the Irish Human Rights and Equality Commission to apply to the Circuit Court or the High Court for enforcement orders, if it is satisfied that it has reasonable grounds to believe that there has been a failure to comply with Regulations, for the grant of an order requiring the person concerned to comply with the Regulations.

What steps should employers take

Preparation is key. 

In advance of the Regulations being introduced employers should ensure that they understand what is required to be reported and that they have systems in place to carry out accurate reporting. 

If gender pay gaps are identified employers should look at the reason for this and what can be done to close or eliminate the gap.

For more information on the issues raised above, or for any other employment law queries, please contact Breda O’Malley

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