Gender Pay Gap Reporting 2021: Including Furloughed Employees

The obligation for businesses to publish their gender pay gap reports was suspended in 2020 due to COVID-19, however it is back on the agenda for 2021 with some slight changes.

Given that around 1.2 million employers have furloughed employees in the last year, it’s likely that many would like to understand how this has impacted their gender pay gap reporting in 2021. With the next deadline (4th April 2021 for businesses and charities and 30th March for public sector) fast approaching and updated guidance from the Government Equalities Office we thought we’d highlight the key changes to this year’s submission.

With COVID-19 having a disproportionate impact on women, it’s important to note that the pandemic has only heightened an existing problem with gender pay gap prior to the pandemic, with the gap being reported at 17.3% in 2019.

How will furlough impact gender pay gap reporting?

For this year’s reporting, any employee that has been furloughed must be included when establishing what the employer headcount is. This means that they must also be included when calculating:

  • The percentage of men and women receiving bonus pay
  • The average gender pay gap using bonus pay
  • The median gender pay gap using bonus pay

If you are an employer who topped up salaries to full pay whilst employees’ where on furlough, they count as full-pay relevant employees for the purpose of all other calculations and should be included in the calculations of average gender pay gap using hourly rate, median gender pay gap using hourly pay and the percentage of men and women in each hourly pay quarter.

* Furloughed employees that received less than full pay and weren’t topped up do not count as ‘full-pay relevant’ employees and should not be included in the above.

All other reporting requirements remain unchanged and you can view full details of the changes here.

How organisations respond to their gender pay gap is vital 

With it being reported that 75% of furloughed male workers had their wages topped up above the 80% allowance to “normal” pay in comparison to 65% of female workers many businesses who are looking to recruit in the future need to think about how this year’s gender pay gap could look for their brand. With many businesses taking diversity and inclusion very important within their recruitment and striving to attract and retain the best talent, employers need to be seen to be taking steps to support their female employees during these challenging times. As most of 2019/20 data not being reported, this year’s data could effectively be viewed as ‘skewed’, however if this isn’t addressed businesses may well struggle with talent attraction and retention in the future.

Although it appears limited information has been provided around why more male workers had their furlough pay ‘topped up’ by their employers, we can only presume that this is likely down to the industries in which they work withstanding the impact of the pandemic better. It could also be assumed that these stats reflect the fact that employers are likely to want to protect those in senior, higher paid roles which are more typically held by men.

Do you recruit with diversity and inclusion in mind?

Our team at Douglas Stuart have extensive experience with Diversity and Inclusion best practice in recruitment, assessment design and D&I sensitive decision-making. In particular, we work with organisations, and in industry, where there is an uneven gender split in STEM roles, and in a global marketplace where cultural sensitivity is critical. If you would like more information about reducing bias in your recruitment and assessment methodology or competency based interviewing please take a look at our work and contact us on 0161 967 9670.