Employment law expert Patrick Walshe, partner at Dublin firm Philip Lee, offers his perspective on proposed new gender pay gap legislation.

Last year it was announced that the government would enact legislation to address what’s generally known as “the gender pay gap” – the difference in average gross earnings between men and women.

This subject has attracted a great deal of attention in recent years - according to European Commission reports, the average European gender pay gap was 16.2 per cent in 2016 (ranging from 25.3 per cent in Estonia to 5.2 per cent in Romania).

In the UK, where the gender pay gap is approximately 21 per cent, regulations were introduced in 2017 creating mandatory reporting obligation for businesses with more than 250 employees. Non-compliance may result in “naming and shaming” of businesses.

There’s currently similar legislation before the Dáil - according to the EU, Ireland’s gender pay gap is approximately 13.9 per cent.

If enacted, this legislation will force businesses to publish information on the disparity between male and female employee pay each year. Ireland will initially mirror the UK – only companies with 250+ employees will have to publish figures. However, it’s intended that the threshold will reduce gradually from 250 to 150 to 50. That will probably capture most small-to-medium size businesses. It’s also anticipated that failure to report will incur a fine.

Presumably the Government is putting a great deal of emphasis on the “naming and shaming” aspect – the idea is that companies who show a significant disparity in men and womens’ pay will reduce the difference out of embarrassment. It’s also possible that female candidates for roles may be less keen on applying to a company with a track record of paying male employees more.

Apart from that moral dimension, however, there are no enforcement provisions in the draft legislation – the mere fact that a company reports a disparity doesn’t mean the company has to do something about it. The legislation doesn’t contain provisions that can be relied upon by a female employee to force their employer to address the gap.

That said, it’s entirely possible that the legislation may make a difference when coupled with existing law. It should be remembered that there is already an express prohibition in law on gender pay inequality.

Under the Employment Equality Acts 1998-2015 it is prohibited for employers to discriminate between employees on the basis of gender, among other things. In a nutshell, this means that if an employer pays a female employee less than an equivalent male employee, it is discriminatory treatment unless the employer is able to point to an objective factor justifying the discrimination.

An employee who finds themselves in the position of being discriminated against in this way has the option of initiating a claim with the Workplace Relations Commission (WRC). The WRC is empowered to take action if the employer is unable to satisfy the tribunal that no discrimination has occurred.

That said, it’s possible that female employees may still face difficulty – if they’re either (a) not in a position to advance proof that they are being discriminated against or (b) opt not to initiate claims in the first place. One definite potential consequence of the legislation is arming female employees with the necessary information – as everyone knows, most people are cagey about how much they make and don’t tend to discuss salaries around the office watercooler. If, on the other hand, salary differentials in a particular company are free to anyone with access to the internet, that may change dramatically.

To put things in perspective, it’s notable that very few employment equality claims on gender are taken to begin with (only 353 in 2016) and only a proportion of these relate to equal pay in the first place. That is a tiny proportion of a workforce of over two million people.

If the legislation goes ahead and we start seeing published figures in 2019, it’s entirely possible that we’ll also see an upsurge in gender gap type claims. At that point the focus may turn to the kind of acceptable justifications (if any) that the Workplace Relations Commission will accept for paying men and women differently.

It should be emphasised that the legislation remains in draft form and may be the subject of further amendments (although the Government has indicated it intends to pass the bill before the 2018 summer recess). The bigger question is whether the steps currently being taken will be sufficient to bridge the gender pay gap. If a problem exists in Ireland, the only step that is likely to carry real life consequences is a sea change in the way that businesses operate in the first place.