Posts Tagged ‘gender pay gap’

What Will the New Proposed Bill on Gender Pay Mean for Companies in Ireland?

Tuesday, July 13th, 2021

What’s in the Gender Pay Gap (GPG) Information Bill?

The Bill does not itself contain gender pay gap reporting obligations but creates a power to make Regulations mandating employers to report on their gender pay gaps. As such, the Bill is relatively light on detail and we can expect a consultation on draft Regulations quite soon after it becomes law. The Regulations are expected to provide clarity for employers on what will be required (see below), although there is the potential for delay because they will need to properly implement the requirements of the proposed EU pay transparency directive.

An organisation’s GPG will be significant when it comes to its reputation, recruitment and retention of staff, and client expectations.  Where GPG reporting will likely be a recurring annual requirement, with possible publicity around each year’s figures, an employer’s approach to its GPG and the measures it takes to narrow any gap must be considered.

Who will be affected?

The Bill currently provides that the Regulations will initially only apply to those organisations employing 250 or more, before reducing to 150 after two years and 50 after three years.

What must be reported?

As currently drafted, the Bill requires in-scope employers, including public body employers, to report on the difference in male and female remuneration as follows:

  • Mean and median hourly remuneration for full-time and part-time
  • Mean and median bonus remuneration
  • Percentage of all employees who have received a bonus or benefits in kind.

The Bill also indicates that additional regulations may be enacted to provide further clarity on:

  • The class of employer, employee and pay to which the regulations apply
  • How the remuneration of employees is to be calculated
  • The form, manner and frequency in which information is to be published

Unlike the similar UK legislation, affected employers will also be required to provide a narrative to accompany the reported figures in order to explain, in their opinion, the reasons for the gaps identified in their report and, significantly, to outline the measures that employer will take to reduce the GPG identified.

It is likely that the information will have to be published annually on both an employer’s own website and a publicly accessible government website (similar to the UK approach).

Will there be consequences for failure to comply?

Yes. The text of the Bill provides for sanctions for non-compliance with the appointment of “designated officers” empowered to investigate and prepare a report on how an employer prepared its calculations and reporting of final figures. These officers will be able to enter the business premises and seek copies of relevant information.

In addition, the Irish Human Rights and Equality Commission (IHREC) will have the ability to apply to the Circuit Court for an order directing compliance with the regulations. The revised Bill proposes to further extend IHREC powers allow applications to the High Court for enforcement orders.

Further, an employee may take a claim to the Workplace Relations Commission (WRC) where his/her employer is alleged to have not complied with the mandatory reporting obligation. The WRC can order a specified course of action to ensure compliance. Currently the Bill does not provide for any monetary sanctions for breaches, although it is notable that the Minister has referred to strengthening the enforcement mechanisms within the upcoming draft legislation.

How can employers get ready?

There are a number of proactive steps that employers can take in advance of GPG reporting coming into law.

  • Trial run – identify the relevant employee groupings (quartiles) across the business and collate and analyse the payroll data attached to each quartile
  • Technology – assess whether the business has the necessary software and/or hardware to process the calculations required
  • Training – consider what types of training, ranging from payroll staff to HR teams and management, may be appropriate
  • Policies – review existing HR policies around recruitment and promotion.  Evaluate the business’ approach to remuneration and compensation to establish whether such policies indicate any unintentional gender bias. The implementation of a comprehensive flexible/agile working policy will be a core element in facilitating increased female representation in the labour market
  • Invest – explore ways to invest in your staff talent through upskilling and reskilling with a focus on gender diversity – in particular diversifying the leadership pool and implementing innovative methods around talent development and integration
  • Expert Advice – obtain legal advice to ensure appropriate compliance with the regulations (i.e. what elements of a remuneration package should fall within the definition of “pay”; what data protection issues arise; how can issues of equal pay or discrimination be best addressed)
  • Build your Team – identify the key stakeholders within the business that need to be brought together to comply with the reporting obligation and tackle the GPG identified. Input from and cross-collaboration between Finance, HR, Legal and Public Relations is advisable
  • Communication – while mandatory reporting specifies the information to be published, employers must be mindful of the internal and external messaging of both the existence of its GPG and the measures to reduce it, to minimise scope for employee grievances or claims

Separately, employers should consider who the key stakeholders in the business are likely to be. In order to be done properly, gender pay gap reporting normally requires the involvement of a team of people from across the business. These include: payroll (to obtain the pay data), HR analysts (to collect the people data); more senior level HR/ER (to understand the initiatives that can be created or which may already exist to reduce any gaps); and PR/comms (to assist with writing the report).

Need more help? Voltedge Management team can help you to get advice on all aspects of human resources and management. Email Ingrid at info@voltedge.ie or ring our offices at 01 525 2914.

HR & Employment Law – Round Up 2020 and a Look Ahead to 2021

Tuesday, December 15th, 2020

As 2020 draws to a close and we take time to look back and reflect on what has happened this year, we find ourselves continuing to acknowledge what an unprecedented year it has been for us all. COVID-19 has touched every employer in some way or another and while the pandemic has certainly impacted and changed the world of work, our employment laws, codes of practices and guidelines largely remain the same.

 COVID-19 – HR & employment practices issues

Health & Safety

COVID-19 is predominantly a health & safety issue from a work perspective and employers have a duty of care for all employees under H&S legalisation.   While there are no new specific employment regulations related to COVID-19 in place, employers are required to comply with all existing H&S legislation and they must also ensure they comply with the range of obligations and requirements set out in the government’s living document – The Work Safely Protocol (the Protocol), originally issued in May 2020 and updated in November 2020.

The Protocol and the HSA provide various checklists to support employers in providing a safe working environment both onsite and remotely during COVID-19.  Despite the good news on impending vaccines, we expect that COVID-19 will be with us for a significant part of 2021 and employers will still need to continue to review and follow the Protocol for some time yet.

 Layoff, Short time & Redundancy

During 2020, unfortunately many employers were forced to lay off employees or reduce working hours as a result of COVID-19.  Normally, employees on lay off or on short-time hours can claim redundancy from an employer after 4 weeks or more, or 6 weeks in the last 13 weeks. If employees were put on lay off or short-time hours because of COVID-19, their right to claim redundancy has been temporarily suspended.

This rule became effective under the Emergency Measures in the Public Interest (COVID-19) Act from 13 March 2020 and has been extended up until 31 March 2021. Employers are reminded that when selecting employees for lay off or short time working, they should apply the same criteria for selection as for redundancy. The criteria should be reasonable and applied fairly.

While it is expected that many businesses will recover post pandemic, it is anticipated that there will likely be some level of redundancies once the right to claim redundancy has been lifted.  It is important to note that where a business needs to restructure due to COVID-19 and where it may result in potential redundancies, then all the normal redundancy procedures including consultation and selection must be followed.

Working from Home – Ireland & Abroad

Working from Home

Employers reminded that under H&S legalisation, they have a duty of care for all employees even when they are working remotely.   For so many businesses, remote working became a forced necessity rather than a choice.  Many of the arrangements were put in place literally overnight with little time for planning and evaluating risks and supports needed for both the employer and employees.

The updated version of the Protocol guides that  “All staff should continue to work from home to the greatest extent possible” and that employers should develop and consult on working from home policies in conjunction with workers. Employers should familiarise themselves with their H&S obligations which include carrying out risk assessments, provision of equipment etc.

As we move into 2021, it is clear that many organisations will continue to either work remotely in the short term or engage in “blended” working models for the future. In addition to their H&S obligations, employers will need to develop more detailed Working From Home Policies which set out criteria for eligibility,  H&S guidelines for working remotely and also address issues such as Data Protection, Well-Being and Recording of Working Time & Rest breaks.

Engaging with employees at an early stage either through discussion or employee survey would be a great way to address any concerns and to develop a policy that meets both the individual and business needs.

Working from Home – Abroad

In some cases, non-Irish employees chose to return to their home countries and are continuing to work remotely overseas.  It is really important that employers are fully aware of the implications of continuing to permit these arrangements and the potential risks associated with the employee acquiring employment rights in another jurisdiction or giving rise to a tax liability for either the employee and employer in another country.

While most jurisdictions have a taken a flexible and pragmatic approach to these type of arrangements during 2020, it is imperative that employers have a clear understanding of the potential risks that may arise should they continue into 2021.

The right to disconnect

Increasingly, technology has blurred the lines between work and personal life. For many, home working and COVID-19 restrictions has resulted in significantly increased “work-life blur” and is having a significant mental and physical health impact. Unlike some other European countries, there is currently no specific legislation in Ireland that explicitly refers to the right to disconnect.

Between 2016 and 2018, France, Belgium and Spain have all introduced “right to disconnect” legislation.  While it remains to be seen if Ireland follows the lead of other countries and addresses this, some larger organisations are already developing policies that set guidelines and boundaries for their employees.

Retirement Ages & Pensions

The qualifying age for the state pension became a key election issue in February 2020.  As a result of significant political negotiations, the qualifying age for state pension will remain at 66 years for now. While the public sector pension age is now 70, there is still no fixed retirement age in the private sector and many employers continue to face legal challenges as their employees push to work longer.   Employers can establish a mandatory retirement age for employees, but such ages must be capable of being reasonably and objectively justified if they are challenged by employees as being discriminatory on grounds of age.

While a national auto-enrolment occupational pension scheme has been promised for several years, no further progress has been made on this and the pandemic has seen the matter pushed back again.

Family Leave & Flexible Working

Parental Leave increased from 22 week up to 26 weeks with effect from 1 September 2020.  Parental leave entitles parents to take unpaid leave from work to spend time looking after their children. Employees can take up to 26 weeks’ parental leave for each eligible child before their 12th birthday. In general, employees must have been working for an employer for at least a year to get the full amount of parental leave and must give at least 6 weeks’ notice before taking parental leave.

 Parent’s Leave

The current 2 weeks’ parent’s leave is set to increase to 5 weeks for each parent with effect from 1st April 2021.  Parents will be able to take this leave during the first 2 years of their child’s life (or 2 years from adoption).

Flexible Working

Prior to the arrival of COVID-19, the Department of Justice launched a public consultation in January 2020 on flexible working, which aims to help the government address and consider a number of issues relating to flexible working.  While remote working has been a dominant topic during 2020, there is still the broader topic of flexible working to contend with.

The EU Work Life Balance Directive extends the right to request flexible working arrangements to carers and working parents of children up to eight years old. This includes the right to request reduced working hours, flexible working hours and remote working options.  Under the EU Directive, the statutory right to request flexible working will come into effect no later than August 2022.

Illness Benefit & Statutory Sick Pay

Employees who have been told to self-isolate or who have been diagnosed with COVID-19 may claim COVID-19 Enhanced Illness Benefit.   The benefit can be claimed from the first day of isolation or a COVID-19 diagnosis and will be paid for a maximum of 2 weeks where an employee is required to self-isolate and for up to a maximum of 10 weeks where an employee has been diagnosed with COVID-19 and unable to work as a result. This benefit is planned to be in place up until March 2021.

As part of Budget 2021, it was announced that the number of waiting days for the standard Illness Benefit will be reduced from 6 days to 3 days on new claims (from the end of February 2021).

Ireland is one of only a small number of European countries in which there is no legal obligation on employers to provide for sick pay. The Government has recently launched a consultation process on the provision of a Statutory Sick Pay Scheme with a view to it being introduced in late 2021.

Gender Pay Gap Reporting

It had been expected that the introduction of mandatory gender pay gap reporting would come into law during 2020. However, with the focus on other priorities such as COVID-19, progress on the legislation has been slow.  The European Commission announced a five-year strategy in March 2020 that includes legislative proposals on pay transparency.

Binding measures aimed at increasing pay transparency and providing enforcement mechanisms are due to be published by the end of the year. While we do not yet know what form the EU measures will take, the announcement should re-prioritise the Bill here and we would expect to see this back on the agenda during 2021.

Minimum Wage

Since 1 February 2020, the national minimum wage is €10.10 per hour. The Government has approved increasing the national minimum wage by 10 cent per hour, from €10.10 to €10.20 from 1 January 2021.

Liz O’Donovan, Senior HR Consultant