The government has changed the threshold for gender pay gap reporting from 250 to 500 employees In a move to reduce red tape for medium-sized organisations in the UK.
Prime minister Liz Truss said the change, effective from 3 October, would boost productivity and growth, by reducing burdensome administration and paperwork for an estimated 40,000 businesses.
Implemented by the government in 2017, gender pay gap reporting regulations previously required organisations with 250 or more employees to report their gender pay gap data and accompanying commentary in April of each year.
The expanded exemption also applies to other reporting regulations, including days worked by staff, for example. Once the impact of the change is understood, the government suggested it may implement a further extension to businesses with 1,000 employees and under.
Kate Palmer, HR advice and consultancy director at Peninsula, said: “It is assumed that the intention behind this move is to prevent businesses from seeing the reporting obligations as a barrier to grow and expand their teams.
“However, removing the legal requirement to file official reports does not necessarily need to mean that businesses will stop doing it. Hopefully, the benefit of the analysis, both in terms of assessing organisational risk as well as the furtherance of equality, has been seen and businesses will continue to voluntarily report, or simply continue analysing their data in house.
“The introduction of gender pay gap reporting has increased awareness of equal pay over recent years and may have further educated the UK’s workforce on what’s right and what’s not, empowering them to question their employer on any perceived discrepancies.
“We must remember that the law on equality is not being removed; the requirement to pay employees equally remains, as does the enforcement system. Businesses will need to ask themselves whether they simply saw the reporting requirement as a tick-box exercise or if they embraced it as an essential tool to help them ensure that gender plays no part in pay decisions, either directly or indirectly.”
