Progress on Gender Pay Gap Reporting in Ireland?

Speedread

It's fair to say that the progress of mandatory gender pay gap (GPG) reporting in Ireland has been sporadic to date.

As detailed in our previous alerter, the General Scheme of the Government's Gender Pay Gap Information Bill (the Bill) was approved by Cabinet in June 2018. Although the Bill was then submitted to the Joint Oireachtas Committee on Justice and Equality(the Committee) for pre-legislative scrutiny, the Committee's report was only published in February 2019 (the Report). Shortly after, on International Women's Day (8 March), the Minister for Justice and Equality announced at a Special Cabinet meeting that the text of the Bill will be published soon.

So where are we now when it comes to mandatory GPG reporting for employers in Ireland?

The Report

The Committee met with a number of stakeholders in November 2018 as part of its review of the General Scheme of the Bill. They included the National Women's Council of Ireland, the Irish Congress of Trade Unions and the Irish Business and Employer's Confederation.

The Bill aims to promote wage transparency and to further the National Strategy for Women and Girls 2017-2020. This will be achieved by requiring mandatory reporting and publication of prescribed gender pay data by employers in Ireland. While the Bill visualises only employers with 250+ employees falling within the ambit of the obligation initially, it is envisaged that these obligations will eventually be imposed on employers with 50+ employees within four years. The key elements of the Bill are set out in detail in our previous alerter.

The Report addresses and makes recommendations in respect of five "key issues":

1.     The thresholds for employee numbers at which organisations will be obliged to report

2.     The proposed phased introduction of the legislation over time and by company size

3.     How reporting should describe the categorisation of employees in an individual organisation

4.     Enforcement of reporting obligations and addressing non-compliance; and

5.     The mechanisms for publishing GPG data.

The recommendations

The Report makes the following recommendations:

  • To reduce the threshold for organisations to 10-15+ employees and provide for voluntary reporting by smaller companies
  • To reduce the proposed reporting period from two years to one year of commencement and extend the initial reporting threshold to more companies (i.e. with 50+ employees)
  • Allow for quartile reporting, as is the case in the UK, in addition to reporting by job classification. The Minister may choose to prioritise one form of reporting over another in the initial period
  • The Bill goes beyond the UK approach by proposing several mechanisms for enforcement. The Report recommends an assessment be undertaken of the added value and risks of the enforcement framework. The Report also recommends that the Bill provide for specific fines to increase certainty and transparency and to ensure greater compliance
  • To publish GPG information in real time on a publicly available website and publish meta-analysis of reporting trends annually on that website. The Report also recommended that employers be required to provide a narrative or contextual statement alongside their GPG data.

What else is happening to close the GPG in Ireland?

In parallel to the Government's bill, a private member's bill (the Irish Human Rights and Equality Commission (GPG Information) Bill 2017) is currently moving through the Oireachtas. Our previous alerter details the different approaches set out in these two bills which each aim to address Ireland's GPG. Given recent developments with the Government Bill, it is likely, that this Bill will take the lead.

The Special Cabinet meeting held on International Women's Day also provided useful updates on other initiatives within Ireland to narrow the GPG. This included:

  • the Inter-departmental Working Group on State Boards
  • the Balance for Better Business Initiative (looking at gender balance in corporate boards)
  • the Government's progress on its National Strategy for Women and Girls 2017-2020 (the Strategy)

Referred to by the Minister as "a blueprint for practical change", the Government approved recommendations of the working group to promote greater gender balance – including "increasing the visibility of this issue, changing behaviour and strengthening governance and reporting mechanisms". A consultation process to review the Strategy is due to be completed in Autumn 2019.

Conclusion

The Report refers to the existence of the GPG as "stubbornly persistent" and the Minister has confirmed that "more than 50% of boards are not achieving the target" of 40% female representation.

The precise timing of the formal introduction of GPG reporting in Ireland and whether the Recommendations will be reflected in the text of the draft Bill (which has yet to be published) remains unclear. What is crystal clear, however, is that the issue of Ireland's GPG is very much on the Government agenda. It is a case of when, not if, mandatory reporting becomes law in Ireland.

Given the media scrutiny experienced by UK employers when these reporting obligations came into effect last year, employers in Ireland have an invaluable opportunity to take steps now to get their house in order.

For more information in relation to this topic, please contact Ailbhe Dennehy, Senior Associate, or any member of the A&L Goodbody Employment team.

Date published: 27 March 2019