What impact will Covid-19 have on Gender Pay Gap Reporting?

In light of the Covid-19 pandemic, and the unprecedented pressure on employers, the Government Equalities Office (GEO) and the Equality and Human Rights Commission (EHRC) suspended enforcement activity of the gender pay gap reporting deadlines for the 2019/20 reporting year.

As we approach the 2020/21 deadlines, we understand the GEO are considering the circumstances and intend to take an "appropriate" and "proportionate" approach to enforcement. What this actually means in practice is unclear.

Whilst we anticipate that further clarification and information will follow in due course, it does little to assist employers who are beginning to gather and assimilate the relevant pay data, particularly as there has been no indication that the deadline will be suspended for the 2020/21 reporting year.

Many commentators have suggested that the gender pay gap figures for 2020/21 are likely to be impacted by the introduction of furlough under the Government's Coronavirus Job Retention Scheme (CJRS).

In particular, a study by Women's Budget Group suggested that around 133,000 more women were furloughed than men across the UK during the first wave of coronavirus and that women constituted 52% of all workers put on furlough across the UK from March to August 2020.

If, as has been suggested, furloughed employees (who were paid less than their standard pay due to being on temporary leave) should be treated as relevant, but not full-pay, employees (which many would argue is the sensible approach although it has not been confirmed/approved by the GEO), then they will be included in the following calculations:

  • The percentage difference between the mean bonus pay for male and female relevant employees
  • The percentage difference between the median bonus pay for male and female relevant employees
  • The proportion of male and female relevant employees who received a bonus in the same 12-month period.

However, crucially, they will be excluded from the following key gender pay gap calculations:

  • the percentage difference between the mean hourly rate of pay for male and female full-pay relevant employees
  • the percentage difference between the median hourly rate of pay for male and female full-pay relevant employees
  • the proportion of male and female full-pay relevant in each of four pay bands (quartiles), based on the employer's overall pay range

Employees who had their pay topped up would presumably still constitute full pay employees for the purposes of the regulations.

If large groups of employees are excluded from certain gender pay gap calculations it will make it more difficult to carry out meaningful comparisons to determine whether real progress has been made in closing the gender pay gap.

In addition, The Fawcett Society's Coronavirus Crossroads Report claims that over a third (35%) of working mothers say they have lost work or hours due to a lack of childcare, but that since the pandemic the amount of time fathers spend caring for their children has doubled and many want to play a greater role in parenting. It suggests that enabling equal sharing of care in the home would create more equal opportunities in work, reduce the motherhood penalty (because women would not be seen as the only ones who take time off), and reduce the gender pay gap.

The Covid-19 pandemic could represent a real opportunity for positive change and progression in the future. Whether this comes to fruition remains to be seen, but regardless of progress, many claim the 2020/21 reporting data is unlikely to be truly representative.

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