A LEADING North East accountancy firm has urged businesses to act quickly now the new gender pay legislation has come into effect.

Tait Walker has seen an increase in those seeking advice on the legislation and believes that some payroll teams will initially struggle to cope with the extra demand that it will bring.

From today (April 6 2017), individual employing entities with 250 employees or more will have to collate the relevant payroll information which will allow the company to publish the differences between men’s and women’s salaries on both its own website and to the Government by April 4 2018.

Initially these regulations are thought to affect around 8,000 companies and 11 million employees, but corporate groups may also choose to voluntarily disclose information across the wider group. Details should be published on workers providing personal services, including zero-hours contractors, some freelancers and short-term contractors.

The latest ONS figures show that the current pay gap for full-time workers stands at 9.4 per cent*. While there is currently no specific civil or criminal penalties for a failure to comply with the new legislations, it will constitute an unlawful act and punishment may be brought in before next year.

Clair Williams, employment tax advisory manager at Tait Walker, said: “There have been various changes in employment law in the last few years, and this new legislation may prove to add further burden on payroll teams. Having spoken to a lot of businesses about the legislation, their main concern is that current payroll systems are not yet equipped to pull out the relevant information required.

“Initially, companies will need to make sure that their systems are able to deal with these new requirements. Although the legislation allows a full year before they have to publish their results, it is important that action is taken quickly so they are able to assess the outcomes and make any necessary changes. Surprises may occur so it will be important to ask key questions – what does the gender pay gap look like for the business? If there is one, why? Advice may need to be sought from a lawyer if there is a clear disparity.

“Once published the reports will be in the public domain and businesses will need to explain the results. If there is a clear pay gap between men and women this will need to be sensitively handled and communication with staff may be needed before the results are published.

“Having said all that there are still a number of individuals and businesses out there who aren’t even aware of the legislation – the first priority needs to be to raise awareness of it and what it means to them.”