Under the Equality Act 2010, it is unlawful for an employer to discriminate between men and women in terms of their pay and conditions where they are in the same employment and are doing the same or similar work, work rated as equivalent or work of equal value. An employer only has a defence against a claim of sex discrimination with regard to pay where the difference in contractual terms is due to a ‘material factor’ which is not directly or indirectly discriminatory.
From 1 October 2014, the Equality Act 2010 (Equal Pay Audits) Regulations 2014 apply to Employment Tribunal (ET) claims presented on or after that date where the employer has been found to have breached the equal pay provisions of the Equality Act.
The Regulations set out the circumstances in which the ET must order the employer to carry out an equal pay audit, the required contents of the audit and the timetable for ensuring compliance with the order.
There is an exemption for existing micro-businesses (i.e. those with fewer than ten employees) and new businesses (i.e. brand new businesses started in the twelve-month period before the complaint was made).
Where an order is made, this will include a description of the persons for whom relevant gender pay information must be included, the period of time covered by the audit and the date on which the audit must be received by the ET.
Once the audit has been satisfactorily completed, the gender pay information it contains will normally be required to be published ‘in a format accessible to all affected staff’, which will usually be on the employer’s website, for a period of at least three years.
Failure to comply with an order may result in a penalty not exceeding £5,000, with possible additional penalties for employers who continually fail to comply with an order.
If you would like assistance with carrying out a review of the pay and conditions of your workforce to check that these are fully compliant with equal pay legislation, contact Justin Sadler on email: [email protected]