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Irish Government Regulation on Gender Pay Gap Calculations

Insurance Ireland Diversity & Inclusion Update | June 2022

On Tuesday, 10th May 2022, the Irish government released a guidance note to employers on how to conduct their Irish gender pay gap mandatory reporting calculations. Details were given on the steps companies with 250 or more employees need to take in order to calculate their gender pay gap statistics for their chosen snapshot date in June 2022. Publication of the calculations will be required on the company’s website on the mirror date in December 2022.

Subsequently, the Irish government published the Gender Pay Gap Reporting Regulations in full on the 3rd of June, 2022. The Regulations are available here. The Regulations form the legal basis for the method to conduct an employer’s gender pay gap calculations under the Gender Pay Gap Information Act 2021.

The Regulations clarify a number of key areas including:

  • Employees on various types of leave, except those on a career break for the entire duration of the period, must be included in the calculations
  • Top up payments to those on certain leaves, such as maternity leave and sick leave, are to be included in the calculations; however, the amounts paid to an employee outside of the top up amount (such as by the department of social protection) in respect of these leaves is to be excluded
  • An employer’s gender pay gap report must be made available for both their employees and the public, this can take the form of publication on the employer’s website
  • While the Department of Children, Equality, Disability, Integration and Youth considers it best practice for group companies, with separate legal entities who do not meet the 250 or more employee threshold, to report, it is not a legal requirement (where group companies have separate legal entities that do meet this threshold, each separate legal entity with 250 or more employees will have to report)

Gender pay gap reporting along with the Central Bank of Ireland’s (CBI) focus on diversity and inclusion as part of the Individual Accountability Framework (IAF) in regulated firms will continue to put a spotlight on Irish insurance companies. The CBI has noted previously that it “considers a lack of diversity and inclusion at senior management and board level in organisations to be a leading indicator of elevated behaviour and culture risks” with a gender pay gap within an organisation typically being an indicator of a lack of gender diversity at senior levels.

In October 2021, the Financial Times identified the insurance industry and wider financial services sector as having one of the most pronounced pay gaps of any sectors, with the lack of women in senior roles identified as the main driver of this. To address, insurance companies in the UK are promoting a wide range of initiatives such as flexible working, creating an inclusive work environment, examining recruitment methods, and their promotion process.

Objective

Gender pay gap reporting is part of a wider government strategy to address gender participation rates and parity in the Irish workforce. The objective of gender pay gap reporting is to:

  1. draw attention to issues such as a lack of female representation in senior management and/or management positions, an over representation of women in lower paid roles, and that there also may be a greater proportion of women in the workforce working part time.
  2. oblige companies to outline how they both explain the presence of a gender pay gap within their organisation and the steps they’re taking to address it.

The Calculations

The calculations require companies to calculate the following:

  • The differences between:
    1. The mean and median hourly pay of male and female employees
    2. The mean and median bonus pay of male and female employees
    3. The mean and median pay of part-time male and female employees
    4. The mean and median pay of employees on temporary contracts
  • Companies will also need to report the percentage of men and women who:
    1. Received bonuses
    2. Received benefits in kind
    3. Are in the lower, lower-middle, upper-middle and upper range pay bands

The calculations require employers to calculate the total ordinary pay, total bonus, and total benefits in kind for each employee on the snapshot date, along with the hours they worked during the reporting period (snapshot date to the day after the snapshot date in 2021 i.e. if snapshot date is June 24 2022, the reporting period will be 25 June 2021 to 24 June 2022).

Employers should also note which employees are full-time employees, part-time employees, or on temporary contracts over the reporting period.

Key Differences Between UK and Ireland Gender Pay Gap Reporting Requirements

What Immediate Steps Should Companies be Taking?

  1. If they haven’t already, companies should be looking to collect the key HR and payroll data, as outlined in the regulations section above, in order to be in a position to complete their gender pay gap calculations.
  2. Companies should then ensure that they understand and fully comply with the Irish guidance note and soon to be published regulations. This is crucial where companies have carried out some form of gender pay gap calculation in the past or have relied on the UK regulations to date as a proxy.

For more information or assistance on how your organisation should approach their gender pay gap calculations, the review of calculations already completed, and the formulation of a gender pay gap strategy, please contact our team of experts below.

This article originally appeared in the Insurance Ireland Diversity & Inclusion Update, June 2022.

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