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Fewer than 500 employers – mandatory reporting will no longer be a legal obligation

Thousands of businesses who are currently legally required to file mandatory reports will no longer have to do so, the Government has announced.

Thousands of businesses who are currently legally required to file mandatory reports will no longer have to do so, the Government has announced.

As it stands, many thresholds for compliance with reporting rules are set at 250 employees, meaning that businesses with 250 or more employees must submit annual reports on gender pay gap and executive pay ratio, amongst other things.

But this is set to be increased to businesses over 500 employees.

No fixed implementation date has been announced yet, however, Treasury Ministers are suggesting that they could raise the threshold even further so that reporting obligations could apply only to companies with more than 1,000 staff.

Kate Palmer, HR Advice & Consultancy Director at Peninsula, says “It is assumed that the intention behind this move is to prevent businesses from seeing the reporting obligations as a barrier to grow and expand their teams.

“However, removing the legal requirement to file official reports does not necessarily need to mean that businesses will stop doing it.

“Hopefully, the benefit of the analysis – both in terms of assessing organisational risk as well as the furtherance of equality – has been seen and businesses will continue to voluntarily report, or simply continue analysing their data in house.

“The introduction of gender pay gap reporting has increased awareness of equal pay over recent years and may have further educated the UK’s workforce on what’s right and what’s not, empowering them to question their employer on any perceived discrepancies.

“We must remember that the law on equality is not being removed – the requirement to pay employees equally remains, as does the enforcement system.

“Businesses will need to ask themselves whether they simply saw the reporting requirement as a tick box exercise or if they embraced it as an essential tool to help them ensure that gender plays no part in pay decisions, either directly or indirectly.”

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