Proposals requiring tribunals to order equal pay audits confirmed
The Government has confirmed that it will proceed with proposals to require employment tribunals to order an employer to conduct an equal pay audit where it has discriminated on grounds of sex in contractual or non-contractual pay.
The Government's consultation on modern workplaces, launched in May 2011, set out a proposal to require employment tribunals to order an employer to conduct an equal pay audit and publish the results of the audit where the tribunal has found against the employer in an equal pay claim under the Equality Act 2010.
The Government has announced that it will implement this proposal. It considers that where "employers do not give sufficient thought to their own pay structures, and so lose cases at tribunal, intervention to require them to give thorough consideration to their pay systems is justified."
A tribunal will be obliged to order the employer to conduct a pay audit in cases where continuing discrimination is likely. Micro businesses will initially be exempt from the audit requirement, and an audit would not be ordered if:
- the employer has completed an audit in the last three years;
- the employer has transparent pay practices; or
- the employer can show a good reason why an audit would not be useful.
Where an employer fails to comply with an order to conduct an equal pay audit, a financial penalty will be imposed.
The Government has confirmed that it will issue a further consultation on the content of the pay audit and publication requirements.
- Government response to modern workplaces consultation proposals on equal pay audits (PDF format, 207K) Read the Government's response to the equal pay aspects of the consultation on modern workplaces on the Home Office website.
- Announcement confirming implementation of proposals on equal pay audits (PDF format, 87K) The announcement of the Government's intention to proceed with the proposal is available on the UK Parliament website.
Also
Good practice guide on equal pay This section of the XpertHR good practice manual discusses the business case for equal pay. It identifies the causes of the gender pay gap, explains how employers can identify and remedy pay discrimination in their organisation, and sets out the steps that employers can take to prevent pay discrimination from arising.
Equal pay policy Use this model policy to set out your organisation's commitment to equal pay between male and female workers.
Questionnaire for obtaining information on equal pay under the Equality Act 2010 Use this questions form to familiarise yourself with the form that an individual who thinks that he or she is not being given equal pay or has received less favourable contractual terms under the Equality Act 2010 will send to the employer to gather further information. There is also an answers form through which the employer can reply.
