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MPs call for smaller companies to report gender pay gap

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A recent report by the Business Energy and Industrial Strategy Committee (BEIS) has called for gender pay gap reporting requirements to be extended to smaller companies.  BEIS has suggested that all companies with more than 50 employees should have to report their gender pay gap from 2020.  Currently, only companies of more than 250 staff must state the average pay difference between men and women.  As such, only half of the UK’s workforce is covered by the present reporting requirements.  The BEIS report states that “the new reporting regime is a step forward, but its full potential has not yet been realised”.

Results from UK companies with over 250 staff, published for the first time in April, produced results highlighting a clear gender pay gap, with some companies reporting a 71.8% gap in pay between their male and female employees.  It has been suggested that in order to find the right initiatives, policies and practices to close possible gaps, all companies (no matter their size) must be encouraged to collate and review their own gender pay gap data.

While it remains the case that businesses with fewer than 250 employees have no requirement to report, some 238 businesses with fewer than 250 employees voluntarily filed their pay gap figures this April.  With transparency over the existing gender pay gap being deemed a prerequisite to closing it and in light of the BEIS calling for “the government to be more ambitious”, it certainly seems possible that the legal obligation to report could be extended.  As such, prudent employers should take steps to monitor and, if necessary, improve any gender pay gap in their workplace before their hand is forced.