Gender Equality Action Plans are coming in 2027 – will employers benefit from acting now?

David: Hello, and welcome to the MFMac Employment Podcast. I'm David Hossack, and I'm delighted to be joined today by Sarah Gilzean.

Sarah: Hello.

David: Just before we get started, a reminder that we have regular webinars, and if you're interested in finding out about these, please search for, MFMac employment webinars on our website, and you'll find details of what's coming up there.

So today, Sarah, we're going to touch on a topic that we've looked at a few times in recent podcasts and that's the question of gender equality action plans, and they're coming in a big way in 2027. And I suppose the question for you really is, do you think that businesses would benefit from acting now rather than waiting?

Sarah: Thanks, David. Yes, so as you said, from April 2027, employers with two hundred and fifty or more employees are going to be required to produce a gender equality action plan, and that's going to have to show what the employer is doing to address gender pay gap and supporting employees through the menopause.

What that means, however, is the first reports won't be due until April 2028. So although the requirement will come into force next year, the reports won't be due until April 2028. So, what the Government is doing this year is to encourage employers to publish voluntarily for the year '26/27, and that would mean uploading a report by April '27 for the current year.

So, the question is, should employers be looking at doing a voluntary action plan this year so that they're well-placed when the mandatory requirement comes in next year and they'll need to start uploading reports by April 2028? So you might ask, why do we need gender equality action plans in the first place?

Well, I suppose the context for this is that it's fairly well documented that the increase, over recent years in female participation in the workforce has been a key driver for economic growth. There's OECD statistics about this that show quite significant growth since 2000 because of increased female participation.

However, we still have a persistent gender pay gap showing that on average, women are paid less than men. The current average gender pay gap is sitting at 11.2%. And in terms of menopause, which is the other aspect that these action plans is going to cover, we still see examples of women leaving the workforce because of menopause or being discriminated against.

And Fawcett Society statistics from 2022 showed that there was one in ten women leaving their roles due to menopausal symptoms. So that's why the Government is acting to put in place these equality action plans and focus on the two areas of gender pay gap and menopause.

David: So, these are fairly significant figures.

Sarah: Yes, and the idea is the action plans will encourage and oblige employers to demonstrate what practical steps they're taking to improving equality of opportunity between men and women in the workplace.

Smaller employers are also encouraged to report, but it will only be mandatory for those with two hundred and fifty or more employees. So it will give employers an opportunity to show what they're already doing to tackle workplace inequality, and if there are other things that are not related to gender pay gap or menopause, then it's relevant to include those too.

But the requirements will mean that employers do have to focus at least two action points on gender pay gap and menopause. So, it is worth thinking about putting an action plan into place now whilst the requirement is still voluntary, because it may look as if it's going to be quite a bit of work to get something meaningful in place in time for mandatory publication by April 28.

If you're going to have a meaningful action plan here, you're going to have to audit your current practices, see where the issues are, see what you're already doing and how effective it is, consult with your employees and other stakeholders, and see what steps might be effective, what budget might be needed for those steps, what decisions might be needed to be taken, and that all takes time.

Fortunately, there is some Government guidance now. Although the final legislation on the requirements has not been published, we do have Government guidance because, as I've said, the Government's trying to encourage voluntary compliance this year. So, the guidance was published in March, and for anyone that is thinking about doing a voluntary report in April 27 or is wanting key pointers in terms of how to get ready for April 28, then I would recommend you have a look at the Government guidance.

It's fairly straightforward. It's broken down into meaningful sections. And what the idea is going to be is that you'll do your action plan, and you'll upload it alongside your gender pay gap data on the Gender Pay Gap Service portal. So we're expecting that that's going to be what happens when the mandatory requirement comes in in April 28 too.

What the Government guidance says is that your first step before you think about your actions is to analyse the data that you have in relation to your gender pay gap and see if you can work out what the causes are of your gender pay gap. And in terms of menopause, engage with your employees to understand what the impact is and what steps might be effective.

You're only going to have effective actions if they're evidence-based. So your first step really is to look for the evidence. If you haven't got the evidence, go and gather it, and once you have it, you should analyse it so you can see what the issues are and work out where best to put resources.

Many organisations find the causes of their pay gap by looking at their workforce data, but you should also look and deal with employee networks, senior leaders, Trade Unions if you have them to see what issues are out there and could be addressed in the action plans. So that's step one, gather your data and analyse it. Consult with employees and others if you can. Step two is to choose your actions to go in your action plan, and what the guidance says is that you need at least two actions, and one of them has to be related to gender pay gap, and the other needs to be related to supporting employees going through the menopause.

And the Government guidance helpfully has 18 recommended actions for employers, so you can have a look at them and see if you could choose from some of them if they're appropriate to your practices. They cover things like recruitment of staff, improving diversity, increasing transparency. Just some examples here. In terms of recruiting staff, the guidance suggests that you look at your job descriptions, make them more inclusive. Do they include mandatory requirements that actually are potentially discriminatory? Do they include language that may put off, women from applying, for instance? Look at how you get applications in for certain roles and at senior levels.

Is there a way of encouraging applications from a wider range of candidates? Is there unconscious bias in the way that you screen CVs? Have your recruiters and decision-makers had training in unconscious bias? Do you use fair and structured interview techniques? Are interviewers subconsciously choosing people that might fit in?

And we know that that's where discriminatory decisions can sometimes creep in. So have a look at how transparent, structured, and objective your interviewing and selection processes are. And think about flexible working as well. Are there roles where you could positively say that you are open to flexible working because that is one area where you may well be able to improve the gender balance in terms of your recruitment. Other areas you might want to look at in terms of making an action could be developing and promoting staff. In terms of increasing diversity, do you have any targets to improve gender representation within the workforce?

You need to be careful that you don't set quotas. We can't have quotas or set numbers for shortlists or appointments into certain posts. But you can certainly have targets that you aim for as long as they don't operate like a quota. In terms of the menopause, what could you be setting as an action there?

Have you trained managers in supporting employees experiencing menopause? Do you make referrals to occupational health for employees in that situation? Do you have any support groups or networks? Are there any adjustments that can be offered? All these sorts of things you might want to look at, and you might want to focus on in relation to menopause and what you're doing to support employees with it.

David: Now, what you're saying there, Sarah there are many examples that are given, and it seems an awful lot for an organisation to start out on.

How would you recommend that an organisation approaches this in a meaningful way without it being too oppressive almost as a first step?

Sarah: You can break it down into manageable chunks here. You're only going to be required to have two actions in your action plan.

You've got 18 here suggested by the Government. So, I think you can probably not try to overcomplicate it, and just pick two that are manageable and achievable, and approach it in that way. What the guidance also says is that you need to have two actions that are new or in progress, so something that you haven't started yet or that actually you're already working on but you're not there yet.

So, you could capture things you're already doing or it could be something brand new. So that's your two minimum. That's really the minimum there. You can also include what the guidance is calling embedded actions, which are things you already do. And you might be ahead of the curve in terms of menopause. You might be able to say you've got all sorts of things in place there and a good policy and a good procedure, and you do risk assessments and all sorts, and that will count as well. You can say that you've got some embedded actions in relation to supporting employees with menopause, but you still need a new or an in-progress one as well.

But I'm sure it won't be too difficult to identify something from the list.

David: So, I'm wondering if you're looking at two actions and you're doing it afresh, it's a completely new thing for you as an employer, could you say which two actions an employer should be tackling generally as the most important?

Sarah: Not really, because I think it has to be tailored to the organisation. You have to look at your evidence, you have to look at your demographics and work out what's going to be most effective for your organisation. So, for one organisation's gender pay gap, there might be a particular thing that you could look at in terms of getting women into leadership positions, for instance.

Another organisation might be very different in terms of, having women at senior levels, and there might be issues with gender pay gap further down the organisation and you might want to look at progression at a more junior level. So, you can't really easily say, "Here's two good ones to focus on." They really have to be tailored to your specific organisation.

David: So it's a matter of doing your audit, as you suggest, trying to ascertain where you think the problems might lie and identify those that are high up the list to begin with, rather than having perhaps too many saying, what's most important in the early years, working on these and then perhaps adding others after that?

Yes. Yes, absolutely. Don't do a scattergun approach and just list everything under the sun. Pick two good ones and focus on them.

David: And I think there's also a need to have a supporting narrative. What's lies behind that, Sarah?

Sarah: So that's supposed to be to provide context and explanation. But I should say there's not a huge amount of space in terms of what employers are going to be able to say in relation to the supporting narrative. It's there to help people understand the factors that might underlie an organisation's gender pay gap but you only have 100 words of supporting narrative for each of your actions. So, the idea is you pick an action, and you give 100 words to support why you've chosen this action. You can also include a slightly longer narrative of 200 words about your overall action plan, but it's not a huge amount of space in terms of what you're going to be able to say, so it will have to be quite focused.

You're not going to be able to upload attachments or insert links, so you've really got 100 words per action and 200 words as an overarching narrative.

David: And how public is this going to be?

Sarah: So, the idea is that your action plan will be uploaded to the gender pay service, so the portal where you already upload your gender pay gap data.

So that's going to be fully searchable. And if it's anything like the scrutiny that the gender pay gap figures get, then there will be plenty of organisations going online to see who's published, who hasn't, and what they're actually saying about their action plans. So that's going to be public. The guidance is also saying that an employer will be asked to link to their own website and the information should also be available on their own website as well.

So, the idea is very public, very transparent.

David: And perhaps the employer taking the initiative as well as complying with the requirements but being more overt in terms of publishing the information is going to be a good thing here.

Sarah: It is.

David: So, there's a lot that can be done in the lead-up to the introduction of these requirements. What lies next, Sarah, do you think?

Sarah: So, you can obviously get the ball rolling now and do a voluntary report in April 2027. If you're not going to do that, you should really start thinking about what you're going to do in your report in April '28. It will come round quickly. The Government guidance gives us a good idea about what you're going to be required to do when the obligation becomes mandatory, but there are going to be further regulations and we will get more detail on what needs to go in a plan, the form of it, and the manner of publication. We're expecting it to be an annual requirement and again, it'll go on the Government portal where you upload your gender pay gap figures.

We'll obviously keep listeners up to date once those regulations are drafted and coming into force. I do think employers shouldn't view the April 28 publication date as a distant deadline. It will be here before we know it. I think employers will be well-placed if they're doing a voluntary action plan this year, even if they just keep it internal for now, just so they can see how it, that's going to work for their organisation and get buy-in from senior leaders so they can see this is the sort of stuff we're going to have to make public by April 28. Here's a draft based on what we're doing just now how can we improve it, et cetera, et cetera. So, I think those that act early are certainly going to be better positioned to comply with the obligation, demonstrate leadership in this area, and also help with reputation, recruitment, retention, because we know that employees that see employers being on the front foot with this do very well, reputationally.

David: Yes, that's something I was going to ask you about. There is very much the sense of doing this on a voluntary basis in line with the scheme, but what you're suggesting is possible as a sort of shadow scheme that can be done without formally engaging at this stage with the Government scheme?

Have you any view as to whether it's better for an employer to do it voluntarily in terms of the scheme or to do what we might describe as a shadow scheme at this stage?

Sarah: I think it depends on the employer. If you're already doing good work and you've got some good actions that you want to aim for, then you might just want to go ahead and publish your voluntary plan by April 27 and that shows you are leading the way here. If you're slightly more nervous about what might go in it and what might be meaningful, you might want to do more of a shadow report that you keep internal and you work out how that can be improved for when you have to publish your real one in April 2028.

David: And finally, Sarah, just wondering in terms of looking at the actions that an employer might take, and I think the sense we have is having not too many, do you think it's worthwhile engaging with the workforce, with the employees on what those actions might be? Or is that something that's best left to management, having analysed as a result of the audit?

Sarah: I do think it is a very good idea to consult with employees because you will have more meaningful actions if that's the case. I think the consultation probably comes at the evidence-gathering stage as well, so that you've got evidence-based actions, and then you may want to go back out to employees with your draft actions. You may want to do that by way of employee networks rather than individual employee consultation but I definitely think you'll have a much more meaningful action plan if employees know about it, have been involved in it, and have been consulted about it.

David: And of course, employers approaching this with the mindset of this is something we think is a good thing rather than this is something that we're required to do in terms of legislation is going to be really important.

Sarah: Absolutely, and I think the Government guidance seems to recognise that employers are already doing things, and that this is an opportunity to say what you're already doing but that there is more you could be doing. So, it is a good opportunity for employers to present it as a positive thing, yes.

David: So if anyone wants to know more about this, Sarah, they can contact you direct, but in addition, we send out a free employment law e-news once a month, and if anyone doesn't already get that, please email us at employment@mfmac.com and we'll get you added to that list. So, thanks very much, Sarah, thanks everyone for listening, and please remember to subscribe to our podcasts and leave reviews in the usual way.

Sarah: Thank you.