News UK equality watchdog to begin probing ‘implausible’ gender pay data

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Firms reporting 0 per cent pay gaps in the firing line as EHRC says compliance with basic requirements has reached 100 per cent.

The UK’s equality watchdog has said it plans to look into organisations that have submitted ‘implausible’ gender pay gap data, after announcing it had reached 100 per cent compliance on the reporting requirements.

The Equality and Human Rights Commission (EHRC) has said it has now received gender pay data from all organisations that meet the reporting criteria, after closing six formal investigations into firms that missed the 2019 reporting deadline.

The six companies investigated, which include high street restaurant chain Pho and international education firm EF Language Schools, have entered into formal legal agreements with the EHRC, committing them to report on time for the next five years.

The watchdog said the firms faced further action, and could be taken to court and fined, if they failed to report on time again.

The EHRC is now turning its attention to companies that have submitted gender pay data it considers implausible – for example, those who claim a 0 per cent pay gap – and has said it will start contacting businesses whose data it has flagged.

While there were no submissions of gender pay gaps of more then 100 per cent in the last round of reporting – a statistical impossibility seen in the previous year – CIPD analysis of the 2019 data found that 8.58 per cent of firms were still reporting an unlikely 0 per cent pay gap, implying that either male and female staff were employed in exactly the same proportions at the same pay levels or the median average pay of the two genders happened to be identical.

It warned that companies found to have submitted inaccurate data could face formal investigation or further legal action similar to the action taken against late reporters.

The other organisations that have entered into legal agreements with the EHRC are the Academy Transformation Trust, P&A Food Management Services, Lewis’s Home Retail and The Westbury Hotel.

In May, the EHRC posted a list of 47 companies that had failed to report their 2019 gender pay data on time, including three repeat offenders, threatening to take legal action. It said the majority of the organisations it contacted quickly provided their data or satisfied the watchdog they were out of the scope of the legislation.

Rebecca Hilsenrath, chief executive at the EHRC, said the watchdog was pleased to have achieved full compliance and would “continue to use the full force of our powers” to ensure firms keep reporting their gender pay gap.

“’We cannot achieve gender equality in the workplace without first shining a light on the problem and understanding the underlying causes of inequality. That’s why gender pay gap reporting is so important,” Hilsenrath said.

“It’s also a legal requirement and changes in staff and poor organisation are no excuse for not complying with the law and withholding this vital information.”

The announcement from the EHRC comes a month after the organisation was heavily criticised by a committee of MPs over its ability to enforce equalities law.

The Women and Equalities Committee said the EHRC needed to be “bolder” in using its enforcement powers, warning that employers were not afraid to discriminate because they knew they were unlikely to be held to account.

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