On March 8th last, International Women’s Day, Minister for Children, Equality, Disability, Integration and Youth Roderic O’Gorman announced the introduction of gender pay gap reporting in Ireland. This landmark piece of legislation will help bring about pay transparency in organisations and play an important role in achieving gender equality in the workplace.
Under the highly progressive regulations, organisations with more than 250 employees will be required to report on their gender pay gap in 2022. Employers will choose a “snapshot” date in June for data gathering and then have six months to prepare their calculations before reporting in December.
A major step forward
“The introduction of gender pay gap reporting is a major step forward for gender equality in the workplace in Ireland,” says O’Gorman. “The legislation sets out some clear metrics which employers can use to measure their gender pay gap, and which will be comparable across other organisations of similar size and industry sector.
“Employers are also invited to explore the reasons behind their gender pay gap and to set out the steps they are taking or intend to take to better address the gender pay gap.”
The gap has no one cause, according to the Minister. “The gender pay gap is influenced by many factors, including a lack of women in senior management positions; women carrying the higher share of unpaid care work and the impact of this on career choices; and the over-representation of women in relatively low-paying sectors, such as care, health and education. Employers are being asked to reflect on the reasons behind the gender pay gap in their organisation and to set out publicly how they intend to address it.”
What is to be reported?
The metrics to be reported are important. After all, the gender pay gap is not only about equal pay for equal work – that principle has been enshrined in law since the 1970s. It is a reflection of the average earnings of people across entire organisations. A significant difference in favour of one gender will point to bias against and a lack of opportunity for the other.
To enable accurate comparison between different organisations, the legislation sets out in detail the process to be used to calculate hourly pay. This includes any bonuses paid during the period under review. Organisations will report on the mean and median hourly wage gaps. As many people will recall from the daily news reports during the Covid-19 pandemic, the mean is the average, and the median is the mid-point between highest and lowest. Including the median is a useful way of excluding the impact of unusually high earners.
They will also report data on bonus pay, the mean and median pay gaps for part-time employees and for employees on temporary contracts, as well as the proportions of male and female employees in the lower, lower middle, upper middle and upper quartile pay bands.
Information on bonuses is particularly important. Employers will report the percentages of all male and female employees who received bonuses. Benefits in kind will also be reported. This will be potentially revelatory.
The inclusion of part-time employees and those on temporary contacts will ensure that the figures aren’t skewed by the exclusion of people who may be on very different pay rates to their colleagues.
Organisations are also required to publish a statement setting out, in the employers’ opinion, the reasons for the gender pay gap in their company and what measures are being taken or proposed to be taken by the employer to eliminate or reduce that gap.
Measures aimed at reducing gender pay gaps at organisation level can include initiatives such as inclusive work practices, recruitment and retention policies, and increasing transparency in the processes for pay setting, bonuses and promotion.
Leading the way
One organisation that has reported on its gender pay gap for some time is An Post, which began reporting in October 2019 and has successfully eliminated the pay gap since then.
“As part of our wider inclusion strategy we had already been looking at representation of women across An Post, and measuring the gap was the next step,” says chief people officer Eleanor Nash. “We also wanted to ensure that any initiatives to improve representation were the right ones for us.”
An Post looked at its data across the company, including the management board, senior management group and graduate programme to understand its demographic from a gender perspective. “We then calculated the mean and median for both our average hourly rate of pay and for performance related bonus payments and interpreted this data to drive key actions from the results,” Nash adds.
“For us it has always been to ensure that the data drives meaningful actions to address the issues raised,” she says. “You have to be fully committed to the bigger picture and to dealing with more difficult issues and full transparency around those issues. The data in itself does not drive change.”
An Post has taken a number of actions on foot of the data. These include the introduction of software to eliminate gender bias in job descriptions and working towards having gender-balanced shortlists for senior management roles.
The organisation also introduced skills training for all employees preparing for interviews internally. And it has launched Aspire, its female talent acceleration programme to support women across the business in career planning and network building.
“This builds confidence and helps women further their careers,” says Nash. “We also launched our internal mentoring programme for female managers to support them as they continue their career at An Post. These initiatives are now business as usual for us and we are focusing on building better representation of females in postal operative roles across the country.”
Organisations with more than 250 employees need to act now to prepare for gender pay gap reporting. The “snapshot” date for this year’s report is fast approaching and reporting must be complete by December. Organisations with more than 150 employees will be covered by the legislation in 2024 and those with more than 50 employees will report from 2025.
[ Visit gov.ie/genderpaygap for more information.Opens in new window ]