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Pay gap reporting in a post-COVID-19 world

Pay gap reporting in a post-COVID-19 world

When COVID-19 is disproportionately impacting some groups, does your current Inclusion & Diversity agenda stand up to scrutiny?

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Image of Donna Sharp

Director, KPMG Law

KPMG in the UK

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As a result of COVID-19, enforcement of GPG reporting was waived for 2019/20 as an early easement for employers. However, the pandemic has highlighted inequality, making Inclusion & Diversity more important than ever, particularly in terms of reputation.

The issue

It is increasingly clear that COVID-19 and the lockdown is having an unequal impact on our population. For example, a report by the Institute for Fiscal Studies and University College London's Institute of Education shows that, of those who were in paid work prior to the lockdown, mothers are:-

  • 1.5 times more likely than fathers to have permanently lost their job or quit; and
  • looking after children 2.7 hours a day more than fathers.   

This is leading to concerns that one of the impacts of COVID-19 will be to stall women’s progress in workplace.

Further, the recent Black Lives Matter demonstrations and the public discourse that has followed show that determination to tackle inequality is at the forefront of the national conscience. Notably, the lack of diversity in some high-profile employers has been a recent talking point.

It is more important than ever for employers to focus on their Inclusion & Diversity agenda, including pay gap reporting. It makes business sense and will help employers to recruit and retain talent that can drive growth leaving businesses better able to face the challenges ahead. 

What can employers do?

There is currently a petition calling on the government to impose mandatory ethnicity pay which has more than 100,000 signatures. The expected regulations are much overdue following a government consultation which closed in January 2019.  This petition demonstrates an appetite for extending the remit of pay gap reporting with Matthew Fell, CBI chief UK policy director, urging firms not to wait until legislation comes into force to carry out ethnicity pay gap reporting given the real competitive advantage that embracing a wide range of talent brings.

Therefore, employers should seriously consider adding ethnicity pay gap reporting to their ‘business as usual’ reward reporting cycle. The way in which employers choose to do this will vary and KPMG has previously called on the government to carry out an additional consultation around ethnicity classification as our client survey indicated that half of respondents felt that binary (White v BAME) reporting was too simplistic.   

How can KPMG help?

KPMG has developed a pay gap reporting tool. This technology allows our clients to not only undertake required pay reporting calculations but also undertake enhanced analysis.

This can provide an organisation with rich insights into their pay gaps (be they gender, ethnicity or other) and potential to consider what can be done to address them.

This allows you to demonstrate that you are engaging with Inclusion & Diversity issues, ensuring that fairness remains a key part of your organisation’s culture even through this unprecedented period.

It also allows you to build on employee engagement and communications around wellbeing and continue to engage with and retain a motivated workforce as you continue to navigate our new normal.

KPMG’s pay gap technology is intuitive, easy to use and gives real insight. Please speak to a member of our Employment Legal Services team if you would like a demonstration or to learn more.

For more information on KPMG's GPG analytics technology, visit our dedicated pay gap reporting page and download our fact cardKPMG’s pay gap analytics technology.

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