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Mandatory gender pay gap (GPG) reporting in Ireland is now in its third year and, as expected, the threshold drops this year (2024) from employers with 250 or more employees to those with 150 or more employees. All employers in scope need to select a snapshot date in June 2024 and report within six months of that date.
By way of reminder, employers in scope must publish the following information:
Importantly, employers must publish a narrative setting out their opinion on the reasons for their GPG in their organisation and the measures (if any) being taken, or proposed to be taken, to eliminate or reduce such differences.
The Gender Pay Gap Information Regulations (the Regulations) have been updated, with effect from 31 May 2024, to reflect the widening of the scope to employers with 150 or more employees, along with some clarifications regarding:
The Regulations are the cornerstone of the GPG regime and it is essential that employers understand their obligations under the Regulations to ensure compliance with GPG reporting requirements.
Payments to employees on certain types of leave
There is a new definition of Basic Pay in the Regulations. Basic Pay now expressly includes payments made to employees in respect of periods during which they are on adoptive, maternity, paternity and parent’s leave (and entitled to state benefit). This includes any state benefit payable to the employee as well as any amounts paid by their employer. This clarifies that such payments are to be included as part of an employee’s ordinary pay when calculating their hourly remuneration, which is in line with the recommended practice to date. Where employers do not pay a top-up to employees on statutory leave, they should report on the benefit the employee is paid where eligible.
Total hours worked
In order to calculate an employee’s hourly remuneration, a figure for the number of hours they worked is required. There are a number of different methods set out in the Regulations for calculating the total number of hours worked by an employee, depending on whether their hours are (a) fixed, (b) variable or (c) whether they do piecework.
There has been a small change to the formula in respect of employees whose working hours are variable:
The formula is now A/12 x 52.18 (previously this was 52.14)
Where A is the total number of working hours of the employee during the period of 12 weeks ending with the last full week prior to the snapshot date.
Share options and interests in shares
Share options and interests in shares no longer constitute bonus remuneration and are now included instead in the definition of “benefit in kind”. This means that share options and interests in shares are no longer included as part of an employee’s hourly remuneration. This should make GPG calculations easier, as employers are not required to assign a monetary value to “benefits in kind” and are only required to calculate the percentage of male and female employees who received benefits in kind.
How to report
The current position is that the GPG information must be published on the employer’s website, or in some other manner that is accessible to all its employees and to the public, and for a period of at least three years. An online reporting system is currently in development and it remains to be seen if this will be up and running in time for the 2024 reporting cycle.
GPG reporting in 2025
Not only is the threshold due to drop again, to employers with 50 or more employees, but the government has indicated that from 2025 the reporting deadline will move to November, meaning that employers will have only five months from their snapshot date in June to report on their gender pay gap.
The EU Pay Transparency Directive
Notwithstanding that Ireland already has legislation on gender pay gap reporting the EU Pay Transparency Directive contains significant extra measures and new laws will be required to align Irish law with its requirements.
While Member States still have up to two years to implement the Pay Transparency Directive it is by no means too soon for employers to begin considering their compliance strategy. The Pay Transparency Directive will lead to an increase in employee and representative involvement in addressing pay equity and it contains potentially arduous requirements to conduct equal pay audits and assessments of work of equal value. It will increase the profile of equal pay and pay transparency across EU member states and likely lead to a rise in equal pay claims. Employers should examine their existing pay practices and take steps to address any issues identified at an early stage.
Next steps
All employers with 150 or more employees in June 2024 now need to prepare for the publication of details of the GPG in their organisation by this December. For employers who are in scope for the first time this year, we would recommend early preparation to ensure sufficient time to compile the data, run the calculations and prepare the narrative.
Please visit our Gender Pay Gap Hub for further updates, resources and guidance for employers.
For further information in relation to this topic, please contact Triona Sugrue, Knowledge Consultant, Kate Heneghan, Associate, Caoimhe Grogan, Solicitor, or any member of the ALG Employment team.
Date published: 1 July 2024
