The gender pay gap is the difference in the average gross hourly earnings of male and female paid employees across a workforce.
It compares the pay of all working men and women, not just those in similar roles, with similar working hours or similar qualifications or experience. It is usually measured across the economy overall, or an entire industry or occupation and is expressed as a percentage of men’s earnings. The gender pay gap in Ireland currently stands at 13.9%, meaning that women earn just under 86 cents for every euro earned by men.
What is the difference between the gender pay gap and unequal pay?
Often these two terms are used interchangeably but they have different meanings and it is important to differentiate between them. Equal pay for equal work is protected under the Employment Equality Acts 1998–2015, meaning that paying a woman less than a man for the same job because of gender is illegal in Ireland.
However, the gender pay gap refers to the difference in the average gross hourly earnings of male and female paid employees across a workforce, not just men and women working in the same role. When an organisation calculates the gender pay gap, it does not identify or indicate if there is any bias or discrimination present.
Why does the gender pay gap occur?
Paying an individual less for the same job based on their gender is wrong, unethical and illegal. And yet, the pay gap exists. The main reason for this is due to women not being equally represented in senior positions and/or working primarily in low-skilled or part-time roles.
Is a gender pay gap a sign of pay discrimination within my organisation?
A gender pay gap does not identify or indicate whether men or women are being paid differently for the same work or if there is a gender discrimination issue within an organisation. However, it does typically indicate that there is a gender imbalance within an organisation.
Gender pay gap reporting in Ireland – what do we know?
The Gender Pay Gap Information Act, 2021 was signed into Irish law on July 13th, 2021. The Act introduces regulations requiring Irish employers to publish their gender pay gap (“GPG”) information for their employees, the reasons for any GPG in the employer's case, and the measures (if any) being taken to eliminate or reduce GPG.
The reporting requirements will initially apply to all public and private sector organisations with 250 or more employees and is expected to begin in 2022 following the publication of specific reporting regulations later this year.
These requirements will expand on, or after, the second anniversary of reporting regulations, where employers with less than 250 employees will be required to publish their GPG data. On, or after, the third anniversary of regulations, employers with less than 150 employees will be required to publish their GPG data.
What steps can organisations take to reduce the gender pay gap?
Efforts to close the gender pay gap are long-term. Organisations must use the information gathered from their gender pay gap reporting to guide and shape their action plan. For example, if an organisation has a large gender imbalance in favour of men at the management level, measures to understand why this is happening and how to address it should be put in place.
Sonya Boyce Director in HR Consulting in Mazars.
This article first appeared in Briefly a weekly eNewsletter from Accountancy Ireland on the 4th March 2019 and has been updated to reflect the passing of the Gender Pay Gap Information Act signed into law on July 13th 2021.