Is your business ready for the next round of Gender Pay Gap reporting?

It doesn’t seem that long since the inaugural gender pay gap reporting deadline, however there’s now less than six months until the next deadline of 4 April 2019 (for the private sector) or 30 April 2019 (for the public sector).

In April, the first wave of reporting across 10,000 organisations employing more than 250 staff revealed that more than three-quarters had a median pay gap that favoured men. More than half of those companies paid higher bonuses to men, while 80 per cent had more women working in low-paid roles than in senior positions.

The figures provoked, in many cases, both media interest and questions from employees. And while the reporting regime was seen by many as imperfect, it did shine a light on important issues around equality of opportunity and barriers to progression.

The assumption among many businesses, however, is that they will be able to demonstrate progress by the time they submit their 2019 figures. Many have promised employees as much. But they may end up being disappointed.

For starters, reported figures are based on a one-day snapshot of a business’s payroll the previous April, which means it will take time for change to filter through.

Experts don’t expect to see a fundamental change to these figures as organisations only really started paying attention to their figures at the point they had to publish, so unless a company carried out a radical intervention, such as a restructure, there won’t be a major shift.  Gender pay gap reporting is best viewed over a longer time frame.

Additionally restrained wage growth and limited budgets are making it difficult to redress the balance, particularly in sectors such as retail, which are dealing with rises in the minimum wage.

The average median pay gap last year was 9.7 per cent, and for some notable businesses such as Ryanair (72 per cent) and HSBC (59 per cent) there is plenty of scope for improvement. But if your gap is below average, incremental gains become comparatively more difficult. Some measures companies are undertaking – such as encouraging more women into male-dominated industries such as STEM – could actually make figures look worse in the short term because they impact primarily at graduate or apprenticeship level.

This matters not just in terms of employee relations but also because in future, businesses failing to address gender pay gaps could put off potential investors and shareholders.

Experts agree companies are mostly taking the gaps seriously with many analysing female labour flow, including the points at which women are promoted and when they’re exiting the company. Others are having ‘constructive dialogues’ around job flexibility and mentoring.

There also appears to be closer scrutiny from HR reviewing the entire employee life cycle. Many companies now run gender-neutral job adverts, have introduced flexible working and have launched mentoring schemes. This is matched by an increase in transparency around pay structures and alignment with performance, and a decreased reliance on discretionary bonuses.

Gender Pay Gap Overview

The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 introduced an obligation for larger employers to report on salaries and pay and the differences in pay between men and women. The key points;

 

  • Reporting requirements will apply to each separate legal entity (i.e. the employer) with at least 250 employees within a group structure
  • The legislation focuses on employers with 250 or more employees delivering a report on the 5th April of a given year- you must use your actual headcount – FTE and length of service of employees does not matter.
  • The Equality Act 2010 makes it unlawful to prevent employees from having discussions to establish if there are differences in pay. However, an employer can require their employees to keep pay rates confidential from people outside of the workplace.
  • If an employer argues that ‘they cannot afford to pay’, this will not be a sufficient defence if discrimination on the grounds of sex is the reason for the differences in pay rates.
  • Also to claim that women are paid less than men because they are ‘prepared to work for less’ is not a defence.

Contact Solve today for more help with Gender pay gap reporting.

With Halloween becoming a much bigger thing in the UK, here are five issues to be aware off that could lead to more scary consequences!

 

  1. Discrimination against non-mainstream religious beliefs

Employers must avoid the temptation to take non-mainstream religious beliefs less seriously than the major religions.

The Equality Act 2010 simply defines religion as “any religion”, and does not state the belief has to be a major religion to be protected.

In the 2011 census, 57,000 people identified themselves as Pagan.

In Holland v Angel Supermarket Ltd and another, a Wiccan employee who claimed she was mocked and later dismissed after switching her shifts to celebrate All Hallows’ Eve won a religion or belief discrimination claim.

 

  1. Discrimination by fancy dress

Employers commonly use fancy dress as a motivational tool during certain times of the year, for example when running themed sales days.

However, fancy dress has the scope to offend some groups, particularly if employees are given no option but to take part.

For example, a Halloween costume that stereotypes someone with a mental health problem, or from a particular religion or nationality, could lead to a discrimination claim.

Two successful employment tribunal claims demonstrate the problems that can occur when employees are expected to dress up at work.

In X v Y, the tribunal found that a gay employee was harassed at a workplace fancy-dress event that he could not opt out of and lent itself to banter of a sexual nature that could easily offend.

In Brown v Young & Co.’s Brewery, the tribunal found that a manager harassed a black pub worker when he told him that he “looked like a pimp” when he was wearing a promotional St Patrick’s Day hat.

 

  1. Halloween-related misconduct

Employers may find that an employee commits misconduct during Halloween.

For example, an employee might bring inappropriate items such as fireworks into work, or use Halloween-related imagery in an inappropriate way.

The employee in Biggin Hill Airport v Derwich was dismissed after she placed an image of a witch as a screensaver on the computer of a colleague with whom she had fallen out.

 

  1. Social media misconduct

These days, what employees post on social media can be as much of a concern for employers as what they do at work.

For instance, Welsh international rugby player Liam Williams apologised in December 2014 after he posted a picture on Twitter of himself at a fancy dress party “blacked up” as the footballer Wilfried Bony.

Employers should have in place a social media policy to make it clear that any inappropriate social use of the internet outside the workplace could result in disciplinary action if it brings the company’s reputation into disrepute.

 

  1. Absence management

Employers should make it clear to employees that absence because of a hangover, or coming to work but being unable to function, following the Halloween weekend is unacceptable.

Before taking disciplinary action, an employer would need evidence that the employee was off sick as the direct result of a hangover, or came to work and was unable to perform his or her duties.

Some employers reserve the right to carry out random alcohol tests on employees, particularly in safety-critical industries.

Two individual directors have been held personally liable for the unfair sacking of a whistleblower for the first time, in a case that will send shockwaves through boardrooms.

Appeal judges have upheld a record-breaking £2m award to the former chief executive of International Petroleum (IPL), Alexander Osipov, who was sacked in October 2014 on the grounds of lack of trust and confidence.

Osipov brought proceedings in the UK employment tribunal (IPL is based in Australia, but listed on the London Stock Exchange) for unfair dismissal and four counts of victimisation including for whistleblowing. The four co-defendants included two non-executive directors of the company: Frank Timis, the majority shareholder, and Anthony Sage, IPL’s chairman.

In 2016 an employment tribunal ruled that Osipov had been unfairly dismissed, primarily for making protected disclosures under whistleblowing legislation.

He was awarded compensation for unfair dismissal, injury to feelings and unpaid salary. The employment appeal tribunal (EAT) upheld the initial ruling and awarded the claimant £1,744,575.56 (now recalculated to be £2,003,972.35).

The second of two judgments made by the ET found Timis and Sage jointly liable for the award to Osipov. The two directors took this ruling to the Court of Appeal which has now upheld the original tribunal and EAT decisions.

The dismissal of Osipov in 2014 came at the culmination of a series of disagreements between the chief executive, Timis and Sage and other senior employees over IPL’s operations and the award of contracts in Niger, during which Osipov had become excluded from decision-making.

He was then dismissed without a notice period, and IPL claimed that because it only had a very small HR department it was unable to follow the correct dismissal procedures.

Osipov told the ET that his concern was good corporate governance and the need to avoid suggestions of bribery and corruption, which had blighted businesses in Niger. He also voiced concerns over the holding of data that may have breached Niger’s petroleum code.

The case is particularly notable because it has confirmed that individual directors taking the decision to dismiss someone for making a protected disclosure under whistleblowing legislation can be held personally liable.

The case is an important reminder for decision-makers to think more carefully than ever before about giving instructions to dismiss an employee for whistleblowing.

It’s vital that employers identify any potential whistleblower complaint at an early stage and isolate complaints from any other processes involving the whistleblowing employee, such as a performance or grievance process.

It’s advisable for employers to provide relevant training on whistleblowing to their staff, in particular line managers, decision-makers and those involved in internal HR procedures.  Especially when those who take the decisions can be held personally responsible if they are Directors.

A whistleblower is a worker who reports certain types of wrongdoing. The wrongdoing they disclose must be in the public interest. This means it must affect others, e.g. the general public.

Whistleblowers are protected by law – they shouldn’t be treated unfairly or lose their job because they ‘blow the whistle’.

Concerns can be raised at any time about an incident that happened in the past, is happening now, or is believed will happen in the near future.

A confidentiality clause or ‘gagging clause’ in a settlement agreement isn’t valid if you’re a whistleblower.

Complaints that count as whistleblowing are as follows:

 

  • a criminal offence, e.g. fraud
  • someone’s health and safety is in danger
  • risk or actual damage to the environment
  • a miscarriage of justice
  • the company is breaking the law, e.g. doesn’t have the right insurance
  • you believe someone is covering up wrongdoing

At Solve. we can provide training on whistleblowing procedures and assist in cases of whistleblowing.

A recent employment tribunal ruling is a useful reminder of the special protection afforded to pregnant employees facing redundancy.

In early 2016, the British Museum began a 5-year scheme to train Iraqi archaeologists on excavation techniques and site-management best practice. Ms Niki Savvides was hired for the role of training co-ordinator, initially on a one-year, fixed-term contract, with the expectation that her role would continue for the duration of the project. Towards the end of the first year, she informed the Museum that she was pregnant. Talks commenced with the Museum to secure maternity cover but soon afterwards she was informed that the emphasis of the role had changed, that a new post was to be created and that she was being made redundant. The role was then advertised externally and Miss Savvides applied. Unable to attend the interview due to pregnancy-related illness, the Museum withdrew her application.

In Savvides v The Trustees of the British Museum, Ms Savvides contended that the new role of project co-ordinator was similar enough to her current role that it should have been offered to her without having to apply when it was advertised externally. She claimed for automatic unfair dismissal and discrimination on the grounds of pregnancy.

A tribunal agreed and found in her favour. It held that the role change meant the Museum did in fact have a genuine redundancy situation, but as Ms Savvides had the requisite skills for the new role she should have been offered the job. Accordingly, the dismissal was automatically unfair.

In addition, the tribunal found that by withdrawing Ms Savvide’s application when she was unable to attend the interview due to the pregnancy-related illness, the Museum had discriminated against her and awarded an undisclosed financial settlement.

A spokeswoman for the British Museum said: “The British Museum values its employees highly and takes its responsibilities as an equal opportunities employer seriously; we aim to create a family friendly environment for all employees, through enhanced packages and flexibility and by consulting regularly with staff and representatives.

“The employment tribunal considered a case regarding the law on pregnancy discrimination, and came to its decision based on legal technicalities that were specific to this case.”

Notes to employers facing redundancies affecting staff who are pregnant, or on maternity leave.

Genuine redundancy situations do not mean that employers can lawfully dismiss pregnant employees or staff already on maternity leave. It is important to understand and correctly apply the law, most notably Regulation 10 of the Maternity and Parental Leave Regulations 1999 (MPLR) which covers the employees mentioned above.

In brief, Regulations 10 states: “This regulation applies where, during an employee’s ordinary or additional maternity leave period, it is not practicable by reason of redundancy for her employer to continue to employ her…Where there is a suitable available vacancy, the employee is entitled to be offered… alternative employment…”

Essentially an employee selected for redundancy whilst pregnant or on maternity leave, must be offered a suitable alternative role, if her employer has one. Furthermore, this employee should be offered the role in preference to other at-risk employees, even if the other employees were better suited for the role. Without adhering to the legal provisions of suitable alternative arrangements as set out in Regulation 10, any dismissal is automatically unfair and does not need a minimum length of service (normally two years) to recover unfair dismissal losses.

Additionally it is unlawful, due to Section 18 of the Equality Act 2010, for an employee to be treated unfavourably because of her pregnancy or maternity or any illness suffered due to the pregnancy. For a Section 18 claim, no comparator needs to be identified, making proving the case at tribunal easier. Compensation would then be payable for actual loss of earnings (capped), and also for injury to feelings (uncapped).

To be confident of compliance with the regulations, an employer who does not offer any alternative role should be able to show exactly why the new role is not suitable, ensuring that the failure to offer an alternative role is not due to the employee being on maternity leave.

Where a worker is required to sleep-over within the workplace, but may only be woken if needed to carry out a specific duty, the worker is only entitled to the National Minimum Wage (NMW) for the time they are required to be awake, for the purpose of working, they are not entitled to the NMW for the whole shift.

In the case of Royal Mencap Society v Tomlinson-Blake, Ms Tomlinson-Blake was a carer for two adults in their own home.  As well as working day shifts, she was required to carry out a sleep-over shift between 10pm and 7am for which she received a payment of £29.05.  During the sleep-over shift, she was not required to carry out any duties but was required to remain at the clients’ house and keep an ear out in case she was needed.  Ms Tomlinson-Blake had her own bedroom, together with a shared bathroom.

Ms Tomlinson-Blake claimed that she was entitled to the NMW for the whole sleep-over shift.  The Employment Tribunal and Employment Appeal Tribunal (EAT) upheld her claim, ruling that she was working for the whole of the shift.

Mencap appealed to the Court of Appeal who upheld the appeal.  The Employment Tribunal and EAT should have concluded that she was available for work, rather than working, and that the sleep-over exception in the National Minimum Wage Regulations 2015 applied – she slept by arrangement at her place of work and was provided with suitable facilities for doing so.  Therefore, only the hours when she was required to be awake for the purposes of working counted for NMW purposes.

This is an important decision for employers in the care sector who engage workers to carry out sleep-over shifts at work.  The Court of Appeal reviewed and, in effect, overturned a significant number of previous authorities on the treatment of sleep-over shifts for NMW purposes.  Workers who carry out sleep-over shifts at work are only entitled to the NMW Wage for those hours where they are awake and working.

It is important to note, that the judgment only deals with the situation where a worker is expected to sleep all or most of the shift but should be available if required.  It makes it clear that it is not dealing with cases where a worker may be permitted to sleep between tasks.  For example, a night security guard who is responsible for patrolling premises from time to time throughout the night but who is permitted to sleep for short periods between patrols and is given a mattress to sleep on in an office, would be regarded as working throughout his shift and entitled to the NMW for the whole shift.

For further advice and support on what counts as working time and NMW contact us at Solve.

 

In the case of Ali v Torrosian and others (t/a Bedford Hill Family Practice), Dr Ali was on long term sick absence following a heart attack, which was accepted as a disability.  A medical report stated that it was unlikely he would be able to return to work on a full-time basis but that he could return on a phased, part-time basis.  Dr Ali was then signed off work for six weeks due to a shoulder injury.  On the expiry of that certificate his employer dismissed him on grounds of capability.

Dr Ali claimed that he was unfairly dismissed and discriminated against due to his disability.  The Employment Tribunal (ET) found that his dismissal was unfair due to this employer’s failure to consider a return to work on a part-time basis, but rejected his discrimination claim, finding that his dismissal was justified by the employer’s legitimate aim of ensuring that it provided the best possible care to patients.

Dr Ali appealed to the Employment Appeal Tribunal (EAT) in relation to the rejection of his disability discrimination claim.

The EAT ruled that the employment tribunal had been wrong to find that dismissal was justified, without considering whether part-time working was a less discriminatory means of the employer achieving its legitimate aim.  Having found that the employer’s failure to consider part-time working meant his dismissal was unfair, it should have taken this factor into account when considering whether dismissal was proportionate.  Although the tests for unfair dismissal and disability discrimination are different, the factors that are relevant for determination are likely to be substantially the same.

At the date of dismissal, Dr Ali’s last sick certificate had ended and the medical advice indicated that he should be able to return on a part-time basis.  The ET should have considered whether the employer’s failure to consider part-time working as an alternative to dismissal meant that his dismissal was not objectively justified.

The EAT submitted the case to the same tribunal to reconsider this issue.

For advice and support on absence and discrimination, contact us at Solve.