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Employment law: New Codes of Practice developed by the Irish Human Rights and Equality Commission

By: Emily Sexton and Saoirse Coughlan | Posted on: 23 May 2022

Two new statutory Codes of Practice developed by the Irish Human Rights and Equality Commission (IHREC) have been launched in relation to the following employment issues:

  • Sexual Harassment and Harassment at Work
  • Equal Pay

The codes of practice have been prepared by the IHREC with the approval of the Minister for Children, Equality, Disability, Integration and Youth. They seek to promote the development and implementation of policies and procedures that establish working environments free of harassment in which the dignity of everyone is respected and to eliminate pay inequality.

In this, the second of a series of two articles, Emily Sexton and Saoirse Coughlan look at the Code of Practice on Equal Pay.

To read part one of this series, which focuses on Code of Practice on Sexual Harassment and Harassment at Work, click here.

Code of Practice on Equal Pay

The aim of the code is to provide practical guidance to employers, organisations, trade unions and employees on three aspects:

  • The right to equal pay;
  • The elimination of pay inequality; and
  • The resolution of pay disputes.

Right To Equal Pay

The right to equal pay for like work is set down in legislation – the Employment Equality Act 1998 as amended.  It means that a person covered by the legislation who is performing the same or similar work, or work of equal value, to that of another person employed by the same employer (or an associated employer) has a right to be paid the same as that other person - there cannot be a difference in pay on the basis of any of the prohibited grounds.

The prohibited grounds are:  gender, civil status, family status, sexual orientation, religion, age, disability, race/colour/nationality or ethnic or national origins, and Membership of the Traveller Community.

The prohibition on discrimination extends to situations where a ground actually exists and also covers situations where a ground once/used to exist but no longer exists (for example a past period of illness); where a ground may exist in the future (for example, family status or pregnancy); or where a ground is imputed to a person (for example, where a person is assumed to be a Member of the Traveller Community or is assumed to be of a particular sexual orientation.

The Code highlights that what is meant by “pay” is very broad and includes any consideration which the employee receives, directly or indirectly, from the employer in respect of the employment. It includes allowances, bonuses, performance payments and non-cash benefits such as cars or mobile phones.

For an equal pay claim to be made, there are certain elements which are important:

  • A contract of employment must be in place - this can be express or implied.
  • “Like work” – the claimant must show that they are performing ‘like work’ with that of a chosen comparator, that they are receiving less pay than the comparator, and that the reason for this is because the comparator differs from the claimant on one of the prohibited grounds.
  • “Same work” - the work performed must be the same or interchangeable for the claimant and the comparator. The conditions in which the work is done must also be similar or the same i.e., nature of the workplace.
  • “Similar work” - the difference between the work of the claimant and that of the comparator are insignificant.
  • Equal value - there must be an equivalence in skill, physical and mental requirements, level of responsibility and working conditions.

The Elimination of Pay Inequality

The Code has a specific section which provides guidance to employers in identifying pay inequality and eliminating it.  Sometimes, employers conduct what they term “pay reviews” or “pay audits”.  What is meant by this is essentially a broad investigation of an employer’s pay practices across the organisation with a view to ensuring that there is no inequality on any of the prohibited grounds.  

There is no mandatory requirement on an employer to carry out a pay review but the Code states that such a review can be the most effective way of achieving pay equality (provided that it incorporates, as part of the process, a rational and objective job evaluation model).   The Code promotes joint management and employee participation in such reviews. 

The Code sets out how a pay review process should proceed.  A summary of the steps is as follows:

  • Collection of data including job descriptions or role profiles describing the relevant jobs;
  • Analysis of job data and observation of the role being evaluated (job evaluation);
  • Analysis of pay data: identification of any apparent differentials in pay for same/similar jobs or jobs of equal value and the reasons for such differentials; and
  • Implementation of equal pay.

The Code does provide some detail in terms of what each of those steps requires and is a very useful starting point for employers.

Resolution of Pay Disputes

The Code does also deal with the resolution of pay disputes e.g. where an individual considers they are not being paid equal pay for like work.  It suggests that an individual should firstly raise their concern informally with management through the employer’s internal grievance procedure and if not resolved via that route, through the formal internal grievance process.  Thereafter the individual has the option of lodging a claim with the Workplace Relations Commission (or to the Circuit Court, if the matter relates to the gender ground).

Right to Information

The Code highlights that an individual has right to seek material information from the employer under the Employment Equality Act as amended.  This can be useful as for many employees/individuals, part of the difficulty in bringing an equal pay claim is that they are unsure what their comparators are earning and would have no other means of obtaining that information.  An employer is not obliged to furnish this information, but inferences may be drawn if they do not.

Gender Pay Gap

Separately to the Code of Practice on Equal Pay, the Gender Pay Gap Information Act 2021 has introduced the legislative basis for gender pay gap reporting and regulations under the Act are expected to be published shortly.   The regulations will require organisations with over 250 employees to report on their gender pay gap.   At the time of writing the Regulations have yet to be published but the Department of Children, Equality, Disability, Integration and Youth published guidance and a list of FAQ’s for employers in May 2022 regarding gender pay gap metrics and information reporting.  These are available at www.gov.ie . 

Conclusion

The provisions of the updated Code are reflective of an increasing awareness of equality issues in society more broadly.  It is important that employer policies are sufficiently comprehensive and current to protect employees in the workplace today. This Code contains a specific section which provides guidance to employers in identifying pay inequality and eliminating it. 

To read the new code in full, click here.

If you have an Employment Law query, or a question relating to the above article, please contact a member of our Employment Law Team.

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