Written by Stewart Waddell on November 9, 2017

With GDPR looming over our shoulders, it is understandable that many employers have paid little attention to their Gender Pay Gap (GPG) requirements. At the halfway point between legislation coming into effect in April 2017 and the publishing deadline in April 2018, less than 3% of employers had fulfilled their obligation to publish their results. Whatever the reason for this staggeringly low statistic, there will undoubtedly be a flurry of employers trying to negotiate their way through the legislation and publish something meaningful into the public domain over the next 6 months. 

There is plenty of readily available literature explaining the technical aspects of GPG legislation, but little useful practical guidance. The 7 calculations that form the basis of the legislation are actually very easy to carry out - the challenge is in collating an accurate dataset that is understandable. Dataplan has all the tools necessary to generate your calculations. Actively working with us to understand the following pragmatic steps will ensure that the process runs smoothly and you have a set of results that you can understand:

- Check what payroll elements are being included in your gross pay for GPG. 

Our payroll system holds the capability to automatically generate your calculations, but this will require configuration in the first instance. Although we are the payroll experts, you are the experts of your business and you should check to ensure you are in agreement as to what payroll elements have been included in the calculations.

- Review the contractual data that is held on your payroll system. 

Historically, this data may not have been needed to run your payroll and at best this data may be out of date. Make sure you are happy that current contractual data is being used for the basis of calculating your hourly rates. 

Tricky situations to watch out for:

o Employees that have more than one contract

o You do not hold accurate FTE percentages for part-time employees

o You may have more than one type of FTE contract with different full time hours

o A clear distinction between term-time employees versus full-time employees. I.e. how many weeks in the year are employees contracted to work?

- Clarification on how to treat staff who are not contracted to work all year round 

Term time workers are not contracted to work 52 weeks per year, although they are usually paid in 12 equal instalments. For the purposes of GPG calculations, we must average their contractual hours over the full year to ensure that all calculations remain consistent.

- The traditional method of calculating the basic hourly rate for payroll is different. 

For payroll purposes, we assume that there are 52 weeks in the year for basis of calculating an hourly rate. Under GPG legislation, we must use 52.18 weeks. It is assumed there are 30.44 days in a month and 365.25 days in a year. 

- Understand the data at employee level for context. 

The legislation only requires you to publish 7 percentages and you are encouraged to provide context with a narrative to explain your results. Without seeing the data that has made up your calculations at employee level, it is going to be very difficult to draw any meaningful conclusions. An element by element build of gross pay for GPG at employee level alongside employee contractual data will build an enriching picture.

Paying particular attention to the above steps will significantly reduce the administrative burden of producing your GPG report. By ensuring you are happy with your set up and by tweaking your processes to ensure that you collate accurate contractual data throughout the year – you can spend less time in generating your GPG calculations and more time on strategy to address your GPG results. 

Stewart Waddell is Operations Director at Dataplan and is responsible for ensuring the efficiency and future-proofing of Dataplan’s systems and processes. Stewart has an encyclopaedic knowledge of payroll and has worked in the industry since 1995. There isn’t much that Stewart hasn’t seen before!

Stewart is a Member of the Chartered Institute of Payroll Professionals.