This article focuses on the obligations and enforcement mechanisms related to private and voluntary businesses in the UK.
Under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, the EHRC has responsibility for ensuing that employers comply with the law on gender pay gap reporting.
On 19 December 2017, it launched a consultation on its planned approach to enforcement.
What is gender pay gap reporting?
By 4 April 2018, employers with 250 or more employees will need to publish their gender pay gap statistics.
The information will need to be published on both the employer’s website (and remain there for at least three years) and on the Government’s designated website.
What enforcement mechanisms has the EHRC proposed?
The EHRC has produced a draft enforcement policy, which can be accessed here.
- Encouraging compliance
It outlines a range of activities that it proposes to undertake in order to encourage compliance, such as:
- Promoting awareness;
- Education;
- Monitoring compliance;
- Publicising compliance rates;
- Promotion of enforcement work.
- Informal resolution
The draft policy highlights that informal action and cooperation are the ECHR’s preferred options.
Informal action will include:
- writing to the offending employer to remind it of its gender pay reporting obligations;
- requiring acknowledgment of the letter within 14 days;
- requiring confirmation in an acknowledgment letter that the employer will:
- retrospectively rectify its non-compliance for the past reporting year within 42 days;
- comply with its obligations by the relevant reporting date in the current reporting year.
Where the EHRC receives the necessary assurances and the employer complies with its obligations within the timescales, no further enforcement action will be taken.
- Formal enforcement
Formal enforcement will be used only when informal resolution does not achieve compliance.
The EHRC has identified a number of powers that it may utilise:
- Section 20: The EHRC will conduct an investigation into the alleged unlawful act. This will include the production of terms of reference, gathering and analysing relevant evidence, and ultimately, producing final report into the allegations.
- Section 23: During a section 20 investigation, an employer will be offered the opportunity to enter into a written agreement to comply with the Regulations, as an alternative to continuing with the section 20 investigation. A section 23 agreement would involve the employer agreeing to comply with the Regulations retrospectively for the past reporting year (within a specific timeframe), and comply with the Regulations for the present reporting year on time. If an employer enters into a section 23 agreement and complies, no further enforcement action will be taken.
- Section 24: If an employer fails to comply with a section 23 agreement, the EHRC will apply to the County Court to enforce compliance.
- Section 21 and 22: If the employer does not accept the offer of a section 23 agreement and the outcome of the section 20 report is that the employer has breached the Regulations, an unlawful act notice will be issued. This notice will require the employer to draft an action plan, within a specified time, setting out how it will remedy its breach and prevent future breaches. If the EHRC do not receive an action plan, they can apply to the County Court for an order requiring one to be produced. If an employer fails to comply with an action plan, the EHRC may apply to the County Court for an order to comply. Failure to comply with a County Court order is an offence, and if convicted, can result in an unlimited fine.
Getting involved with the consultation
The EHRC wishes to hear from business, representative bodies and other interested parties on its planned approach to enforcement. You can respond to the draft policy by completing this online survey: https://www.smartsurvey.co.uk/s/GPGRconsultation/.
The closing date for submissions is 2 February 2018.
For further information on preparing for GDPR, please contact Rachael Lloyd, Solicitor on rachael.lloyd@michelmores.com.
