UK Gender Pay Reporting Plagued by Reporting and Enforcement Shortcomings, Criticisms of Reported Data
March 02, 2018
With about a month to go before the gender pay data reporting deadline for UK companies, heavy criticisms are being directed at UK regulators for, according to the Financial Times, allowing "employers [to] submit fabricated information, or avoid reporting at all." The UK is requiring that all companies—both private and public—with more than 250 UK employees annually submit detailed gender pay data, including:
- The mean and median hourly pay for both men and women,
- The proportion of men and women receiving bonuses, and
- The gender representation in each of the four pay quartiles.
The first filing deadline for public companies is the end of March, with private companies required to comply by April 4. However, according to the Financial Times
, the UK's Government Equalities Office, which oversees submission of the gender pay data, has admitted it only has an estimate of the number of companies that will be required to report. Moreover, it cannot identify companies that fail to file. Additionally, with only a few weeks until the deadline, just over 10 percent of required companies have submitted reports. As noted in the first article, an independent analysis of these filings by the Financial Times
revealed that three percent of the filing companies reported "statistically implausible" numbers and that "the government cannot check the numbers because it did not request sufficiently detailed data." The chief executive of the UK's Equalities and Human Rights Commission (EHRC), presumably responsible for enforcement of the legislation, has stated the imposition of penalties for non-compliance falls outside the purview of the EHRC, with enforcement cases referred to the courts. Nevertheless, the EHRC will conduct investigations of "wholly implausible" data. The EHRC's stance has earned harsh criticism from the Chair of the UK Parliament’s Women and Equalities Committee, who views enforcement of the gender pay requirements as a "full responsibility" of the EHRC. The lack of a regulator with full enforcement authority will likely foster close public scrutiny for key company filings, as has occurred with voluntary gender pay data filings in the United States. It has already led to calls to require UK companies to submit anonymized employee data to allow the EHRC to verify the disclosures.