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Gender pay gap reporting in Ireland – updated guidance clarifies some (but not all) tricky issues

20 July 2022

The gender pay gap reporting regulations in Ireland were published last month. Straight away, a number of issues with interpretation were apparent. The government has now clarified some (but not all) of these.

In this article, we explain the issues addressed by the updated frequently asked questions (FAQs) and clarify what employers should be doing.

Adjusting bonus payments

Clarification was needed on how to adjust bonus payments - this was a big issue in the gender pay gap reporting regulations (Regulations). The Regulations are very clear on how to treat bonus payments when calculating an employee’s hourly rate. They say that, unless they relate to a period the same length as the “relevant pay period” (ie, one year) they should be divided by the period that they relate to and multiplied by a year. Essentially, annualising every payment. As we set out in our earlier article, this would lead to massive distortion of many bonus payments that relate to a period of less than one year (but which are paid more than once in the year). Commission payments – which are very often paid monthly – would be particularly affected.

Thankfully, the latest employer FAQs clear this up. Only payments that relate to a period longer than 12 months must be adjusted. For example:

  • An employee receives a €12,000 annual bonus. All of this is included in the hourly rate calculations.
  • An employee receives twelve €1,000 monthly commission payments. Because none of the payments relate to a period longer than 12 months, no adjustments are necessary and all €12,000 worth of commission payments are added together and are included in the hourly rate calculations.
  • An employee receives a €60,000 long service payment after being employed for 5 years. Because this payment relates to a period longer than 12 months it must be adjusted. It is therefore divided by five and so €12,000 is included in the hourly rate calculations.

Pay for leave, hours for leave

The Regulations give an exhaustive list of what is included as “pay”. Pay for statutory leave (eg, maternity/adoptive leave) is not set out in that list, but the Department of Children, Equality, Disability, Integration and Youth (Department) Guidance said that it should be. The Regulations also state that “working hours” only include time when someone is working or is available to work. When someone is on leave, they are neither.

There are potentially two different approaches:

1. Include pay for leave, use the notional number of hours that an employee would have worked had they not been on leave.

2. Do not include pay for leave, use the actual hours that someone worked (ie, disregard time not working).

The FAQs now clarify this (in part) and say that employers should take the first approach. The FAQs say that pay for leave is included as “pay”. They also say that periods of paid leave should be included when calculating the total working hours for an employee.

However, the FAQs do not say what to do about periods of unpaid leave. Our view is to take these into account – use the notional hours during the period of leave. Since periods of paid leave must be included (even if paid at a much reduced rate eg, 50% of normal pay, as can be the case for periods of maternity leave), the logic follows that this must be the approach intended.

Definition of employee

This has been a tricky issue for employers, and it will continue to be even after these new FAQs. The definition of “employee” for gender pay gap reporting purposes is broad. It is essentially anyone that could bring a discrimination claim.

The FAQs make clear that partners (in an LLP, for example) would be outside the scope of gender pay gap reporting. However, the government encourages employers to calculate and report additional statistics including these individuals.

The new FAQs don’t give any extra information about how to treat contractors. Our advice continues to be to include them if they are providing personal service (but if there are a lot of contractors, and there is a concern that they are swaying the statistics, employers could choose to produce figures which both include and exclude them). This means that someone engaged directly would be included, but not someone engaged through an intermediary such as a personal services company. In any event, many contractors may not be included; only those “employed” for 12 months will be included in the statistics.

Temporary and part-time employees

The FAQs state that someone is a temporary employee if, on the snapshot date, they were not employees on a contract of indefinite duration. If someone’s contract changed during the previous 12 months, that would not affect this. What matters is their status on the snapshot date in June.

The same applies in relation to part-time employees. “Part-time” may mean different things in different roles in a business – for example, a full-time person on the factory floor may be doing 48 hours a week, but a full-time personal assistant might be doing 37.5 hours a week. Hours alone is not a good criterion in determining who to count as “part-time”.


The new FAQs say that pay should be calculated before deductions at source. This means before tax. If pension contributions are also taken before tax, they should be taken into account (they are essentially a negative payment, rather than a true deduction). If they are taken from an employee’s net salary, they should not be taken into account.

The new FAQs do not say how to treat employer pension contributions. Our view is that these are a benefit in kind, since they are not cash being paid to an employee (so outside of the definition of both pay and bonus) but they are something of value.

Group companies

Over the past few weeks, employers have (informally) been hearing different things from the Department as to how group companies should comply. The FAQs now clarify this.

The government’s position is that group companies must report statistics for each individual entity, but they can also go above and beyond the minimum legal requirements and also report a combined figure for all employees in the group. This is something that the government is encouraging, but not requiring. If combined group figures only were reported (and not broken down into individual entities), this would not be enough to comply with the Regulations.

Deadline for reporting

The Regulations say that gender pay gap reports must be published “not later than 6 months after” the snapshot date.

The government’s view in these latest FAQs is that you don’t include the snapshot date when working out the deadline. For example, if an employer has a snapshot date of 1 June, they can report on 1 December (even though technically, a six-month time period from 1 June would expire on 30 November).

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