When calculating their gender pay gap, how should employers treat staff on zero hours contracts?
Employers should include staff on zero hours contracts in the calculation of their gender pay gap if they meet the relevant definition of an employee. The draft Equality Act 2010 (Gender Pay Gap Information) Regulations 2016 define an employee as someone who ordinarily works in Great Britain under a contract of employment governed by UK legislation. However, the draft Regulations have been the subject of consultation and it is expected that they will be amended before being brought into force. The Government has indicated (in its consultation on mandatory gender pay gap reporting for public-sector employers) that the definition of employee that will be used in the final version of the Regulations will be that under s.83 of the Equality Act 2010, which would include workers on zero hours contracts.
The draft Regulations do not specify how to calculate the rate of pay for employees with irregular hours, such as those on zero hours contracts. This is another point that may be clarified by amendments to the Regulations. If an employee on a zero hours contract does not do any work in the relevant pay period, he or she should not be included in the gender pay gap calculation.