Question-ID: 32

The question received: ‘Is there a materiality approach for the people reporting in place (for example, if 99% of the workforce are full-time employees, the difference between our existing FTE reporting and head count is negligible)? Does an additional head count reporting have to be set up or can we keep FTE reporting and provide background information to users?’ has been reworded to the above question to be clearer.

ESRS S1 Disclosure Requirement S1-6 on the characteristics of the undertaking’s employees requires information on the number of employees and the number of breakdowns. The objective of S1-6 is for the undertaking to provide insight into its approach to employment, to provide contextual information that facilitates an understanding of the information reported in other disclosures and to serve as the basis for calculating quantitative metrics to be disclosed under other disclosure requirements in this Standard.

ESRS S1 paragraph 50 (a) requires the disclosure of ‘the total number of employees by head count, and breakdowns by gender and by country for countries in which the undertaking has 50 or more employees representing at least 10% of its total number of employees’. This requirement on the number of employees is consistent with ESRS 2 SBM-1 paragraph 40 (a)(iii) whereby head count data is also required.

ESRS S1 Disclosure Requirement S1-6 (paragraph 50 (b)) allows the undertaking to choose between two methodologies to calculate the number of employees, which are either by head count or full-time equivalent (FTE) of:

‘(i) permanent employees and breakdown by gender;

(ii) temporary employees and breakdown by gender; and

(iii) non-guaranteed hours employees and breakdown by gender.’

The voluntary disclosures in ESRS S1 paragraph 52 (a) (b) follow the same approach as detailed above whereby there is the option of disclosing information on full-time and part-time employees by either head count or FTE.

ESRS S1 paragraph 50 (d) requires ‘a description of the methodologies and assumptions used to compile the data, including whether the numbers are reported:

(i) in head count or full-time equivalent (FTE) (including an explanation of how FTE is defined) …’.

Furthermore, ESRS S1 paragraph AR 55, Table 3 and Table 4 provide the relevant tables to present this information in (Table 3: ‘Template for presenting information on employees by contract type, broken down by gender (head count or FTE)’; and Table 4: ‘Template for presenting information on employees by contract type, broken down by region (head count or FTE)’).

ESRS S1 paragraph AR 60 states: ‘Where data is not available for detailed information, the undertaking shall use an estimation of the employee number or ratios, in accordance with ESRS 1, and clearly identify where the use of estimates has taken place.’