LEGAL

Reporting your organisation's gender pay gap: Your questions answered

In 2017, the Government introduced an annual gender pay gap report for companies employing more than 250 people and while their obligations to report were waived due to the pandemic last year, the process is back and employers have until 4 October 2021 to submit their data. Banner Jones’ head of employment law Katie Ash (pictured) answers some of the most frequently asked questions – including what’s required, and by when.

What is a gender pay gap report?

In the Government’s words, “the gender pay gap is the difference between the average (mean or median) earnings of men and women across a workforce.” The report data is calculated upon hourly wages and includes ordinary pay and bonus pay

Why does it matter?

While gender pay gap reporting may feel like drain on the time and resources available, it’s hoped that by holding employers accountable, it will help them understand how inclusive they are.

It can help to facilitate change within organisations that didn’t necessarily realise they had a problem, and in turn that can help send the right message to current and new recruits, suppliers, investors and customers alike.

The ACAS guidance relating to the gender pay gap goes a step further and recommends that employers put in place an action plan to reduce the gender pay gap in their organisation.

How do I submit my gender pay gap report?

You will need to visit the Government’s website and click “Report your gender pay gap data” within the Employing People section. You’ll then have to create a login before submitting your data if you haven’t done so before.

Your report should give a snapshot of 31 March 2020 if you are in the public sector, or 5 April 2020 in the private and voluntary sector.

Which employees do I include in my data set?

To calculate your data, you’ll first need to work out who your “full pay relevant employees” are. You will also need to record their gender. Note that “relevant employees” includes both contracted employees and those who are self-employed.

You should exclude those who were on annual leave, familyrelated leave, sick leave, special leave or sabbatical at the time of the snapshot. Employees who are on furlough are also excluded.

You can find specific details of who to include on the Government’s website.

What do I do if I have employees who do not identify as male or female, or are going through a transition?

The regulations state that an employer must report on males and females, but doesn’t offer any definition on these categories. It is therefore left to you as an employer to decide how best to include non-binary or transitioning employees.

One option is to use the HMRC or payroll information held on these employees. However, this information may be out of date and it may be more accurate to look at how the employee identifies at the time of the snapshot.

Do I need to submit anything alongside the data?

It’s a good idea to submit a supporting narrative alongside your pay data to show you have analysed any gap across the genders and are taking action to close it. You might even spell out the specific steps you’re going to take to make sure men and women are paid the same.

Though it can be helpful, the narrative is an additional extra and you are not obliged to submit it as part of your pay gap report.

What will happen to my report and why is it important?

Your gender pay gap report will be accessible to all on the Government website. That means potential employees can check your record in paying people of all genders equally. If the gap between men and women is large, they may be dissuaded from applying for, or accepting, a position with your company. You may want to publish a link to your organisation’s written statement and response to show your commitment to fair pay.

What if we miss the deadline?

Following the introduction of gender pay gap reporting, the Equality and Human Rights Commission (EHRC) was given the necessary powers to impose fines for those in breach.

In 2019, the EHRC even went as far as to name and shame the companies that had failed to meet the deadline.

Successfully integrating a team in the midst of a pandemic

Acquiring a business is a highly complex situation that requires months of meticulous planning and preparation before the deal is finalised and two teams can become one. Integrating during a pandemic is even more difficult but Glynis Wright MBE (pictured), who sold her Leicester-based family solicitors Glynis Wright & Co to Nelsons at the end of last year, explains how it can be done.

The key to any successful acquisition is strong leadership. There must be absolute trust and faith in those leading the organisation – and that applies to both the leader bringing their team across and the new leadership at the acquiring company.

Due to non-disclosure agreements during the process of our acquisition by Nelsons, my team only had 14 days to digest the news before we transferred Glynis Wright & Co over to Nelsons – and just to add even more pressure alongside the pandemic situation, those 14 days happened to be in the lead up to the Christmas period.

We work in a people industry, and after all those months of separation and isolation I was, undeniably, concerned about the impact the sudden acquisition would have on my staff.

‘I’m immensely proud of my team for the way it responded during those two weeks’

That’s why, when the time came to announce the acquisition to my team by virtual means, something I’d much rather have done in person but could not because of the lockdown, it was crucial for me to be authentic and transparent, explaining why I’d made the decision to sell and what I thought the benefits would be to them.

I was also honest with my team about the fact I understood my decision would have been a surprise to them and that the integration would be different because of having to manage everything in a pandemic. I encouraged my team to talk to me about their feelings and to express any anxieties they had so we could work through them together.

I’m immensely proud of my team for the way it responded during those two weeks. I strongly believe the gold thread that kept the team together and maintained its focus was holding on to our purpose – to be there for the client, which is central to the core values of Nelsons too, and in family law is crucial given the distress most of our clients suffer during a divorce.

Now nearly five months on, the team has settled in and looking forward to embracing the opportunities that Nelsons can provide. It really helped that each team member I brought across was buddied up with Nelsons’ colleagues who organised one-toones to help with integration, and welcome them to the company. Virtual coffee catch-ups, lunchtime socials and a virtual cocktail night were organised for the team to get to know their Leicester and regional colleagues.

It’s now been half a year since Glynis Wright & Co was acquired and we’ve enjoyed an unbelievably strong first quarter with Nelsons, proving that a team can successfully integrate, even in the heart of a pandemic.

Adopt ESG now or risk getting left behind

Jillian Thomas (pictured), managing director of Future Life Wealth Management, based in Renishaw in Derbyshire, makes the case for ethical considerations when investing or doing business.

I have written before about the importance of ESG issues and I am not going to apologise for banging that drum again.

It might be just three letters (and it stands for environmental, social and governance by the way) but increasingly those three letters will become more important.

We used to talk about CSR, or corporate social responsibility, but ESG goes much further than that.

ESG is not just about sending staff on a volunteer away day or recycling your office paper, it is at the heart of how you do business – to look after people and the planet. It doesn’t matter how small or big you are, ESG is something we all need to think about.

NORMALISING ESG

In May, Shell found itself caught up in a wrangle about carbon emissions when it lost a court case in the Hague, which basically ruled that its aim to be carbonneutral by 2050 was not soon enough under Dutch law –evidence perhaps that ESG is not some fad talked about by a few, but something that is very much becoming mainstream.

The normalising of ESG can also be seen from where people are investing their money. According to the Investment Association, the UK’s assets under management in responsible investment funds grew 89% between January 2019 and June 2020.

And PwC has estimated the share of European assets held in ESG investments could boom from 15% today to 57% by 2025.

‘There are gradations of ESG compliance, from simply avoiding doing harm to proactively doing good’

Thus, those not in the ESG camp could soon find themselves left behind. That might be something to consider when thinking about where to invest your hard-earned money.

WHY ESG MATTERS TO BUSINESSES

But what about you as a business owner? Is this all relevant if you don’t have shareholders? Well, I would argue yes it is – and it will become increasingly so.

Firstly, from a moral perspective, don’t we all want to do the right thing for our staff, our customers and our planet?

And secondly, it is important when doing business with others. Many potential clients and partners will look at your ESG credentials when checking out your business.

You may already be asked about your environmental policies and in some situations you will be asked for more.

A survey showed that currently only a large minority saw ESG as an important factor when carrying out due diligence on potential partners, but I would argue that minority will become a majority.

I am not talking about “greenwashing”, I am talking about something that makes a real difference to our future.

There are gradations of ESG compliance, from simply avoiding doing harm to proactively doing good. For example, at one end is not polluting or using sweatshops, while at the other is creating products or services that benefit the planet.

Remember, you might not have shareholders, but you do have customers and they can vote with their feet.

My advice? Adopt ESG and embrace the culture, or get left behind. It is not just a passing fad, it is a way of life, so adopt or prepare to fail. I am not Greta Thunberg, but I will keep banging the drum.

No individual investment advice is given, nor intended to be given in this article and liability will be accepted in respect of any action you may take as a result of reading this article. If you are unsure you are urged to take independent investment advice.

East Midlands GDP is poised to take off

A combination of restrictions lifting, pent-up consumer demand, accumulated excess savings and a range of Government incentives are expected to spark a strong lift-off for the East Midlands economy by 2022, according to a new report.

The latest analysis by KPMG in its UK Economic Outlook predicts this cocktail of positivity will lead to the region’s GDP growing by 6.3% in 2021 and 4.8% in 2022, allowing the economy to reach its pre-Covid level by Q1 2022.

The contraction the East Midlands suffered last year was mainly caused by falls in manufacturing, wholesale and retail trade – but recovery was able to begin as manufacturing operations weren’t restricted after the first lockdown.

The region’s large manufacturing presence is likely to benefit from the increased demand for investment, as well as the introduction of the super deduction allowance on plant and machinery introduced in this year’s spring budget.

Marc Abrams, East Midlands office senior partner, said: “Our latest analysis shows that the East Midlands’ pace of economic recovery is accelerating as restrictions ease and looks set to do so at a quicker pace than the majority of the UK’s other regions.

“One of the many great things about the East Midlands is the variety of its businesses and the breadth of skills available, which will be beneficial in enabling a broad-based recovery.

‘The East Midlands’ pace of economic recovery is accelerating as restrictions ease’

Marc Abrams

“The new freeport will also present opportunities for stronger growth in the long term, increasing the region’s attractiveness for inward investment.

“While there’s a sense of cautious optimism, and rightly so, it’s still incredibly encouraging to see that the East Midlands’ GDP growth could return to pre-pandemic levels by the start of next year.”