Should partners be included in the report of a partnership's gender pay gap?

The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 (SI 2017/172) do not require partners (or LLP members) to be included in the report of a partnership's gender pay gap. However, partners who meet the relevant definition of employee should be included when determining whether or not the duty to report applies to the partnership.

The gender pay gap reporting duty applies to employers with 250 or more employees. The relevant definition of employee is the broad definition under the Equality Act 2010, which includes individuals employed under a contract personally to do work, as well as those who have a contract of employment. Where the employer is a partnership, whether a traditional partnership or a limited liability partnership, partners should be included when determining whether or not the employer has at least 250 employees, provided that the partners have a contract of employment or a contract personally to do work.

Partners and LLP members are not required to be included in the calculations of the partnership's gender pay gap or gender bonus gap, or when reporting the number of employees in each quartile. This is because the Regulations require employers to report information about "relevant employees" and partners and LLP members are specifically excluded from the definition of "relevant employee". For example, if a partnership has 300 employees, 100 of whom are partners, the reporting duty applies (provided that the partners meet the relevant definition of employee), but it has to report information only on the 200 employees who are not partners.

According to government guidance on the Regulations, partners are excluded from the calculations because they take a share of the profits and this is not comparable with other employees' pay.

Many partnerships have chosen voluntarily to report their gender pay gap figures including partners, in addition to the calculation required by the Regulations, in the interests of transparency.