Companies must reveal gender pay gaps or face unlimited fines

Businesses failing to comply with gender pay gap reporting regulations could face unlimited fines and convictions, the Equality and Human Rights Commission has warned as it published its enforcement strategy. As the regulatory body responsible for ensuring that all employers with over 250 employees report their gender pay gap statistics, the Commission has set out its enforcement policy for consultation. Although it will take steps to encourage compliance and engage informally with employers who are in breach of the regulations as a first port of call, it will ultimately enforce against all employers who do not publish their gender pay gap information. The Commission’s policy – which is open for consultation from today until 2 February 2018 – explains how the Commission will use a range of its powers.

These include:

  • it may investigate suspected breaches of the regulations by private and voluntary sector employers and offer them the opportunity to enter into a formal agreement to comply as an alternative to continuing with the investigation. Such agreements can themselves be enforced if not complied with
  • it may issue unlawful act notices against employers who do not accept the offer of an agreement and who are found to have breached the regulations as a result of the investigation. These unlawful act notices will require employers to comply with an action plan which can be enforced through court orders
  • it may seek summary convictions and an unlimited fine to those who still refuse to comply with a court order

Similar enforcement powers exist in relation to public sector employers.

All private and voluntary sector employers with 250 or more employees in England, Wales and Scotland must publish information on their gender pay gap under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. All listed public sector employers with 250 or more employees in England must publish the same information under the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017. Similar obligations already existed in Scotland and Wales.

Public sector employers in England must publish the required information by 30 March 2018. Private and voluntary sector employers must report the required pay gap information by 4 April 2018. This is the first year of gender pay gap reporting and is now an annual requirement by the same dates.