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Guild information
The loot distribution system used is EPGP.

Effort Points (EP) are awarded for boss kills, time spent in a raid, etc.
Gear Points (GP) are added for loot gained.
EP/GP = Priority Rating (PR) for receiving loot. The person with the higher PR gets the first say on loot. EPGP rewards consistent effort over short bursts of raid activity.
EPGP also recognizes that not all loot is made equal and that a weapon is worth more that a pair of gloves so the cost of items varies for class and slot.
If you download the addon, you will be able to see everyone's EP, GP and PR.

Loot distribution priority
Raider Main Spec > Trialist Main Spec > Raider Upgrade (see forum post) > Raider Offspec > BOE Bank Gear > Trialist Offspec

Gaining and spending

The main awards are:
300 EP for attending a whole raid
50 EP for early bird, signed and ready for raid 10 minutes early
400 EP Wipe Nights on progression
If a player is rotated or on standby they get full EP

The main penalties are:
-5 EP for basic fines
-10 EP for repeat offenders

EPGP decay
All effort points (EP) and gear points (GP) are decayed (reduced) by 20% at the start of a raiding week, exactly before the raid on Wednesday. This is done to prevent EP hoarding. The measure rewards active and consistent raiding instead of long-time membership.
This means that everyone loses 20% EP and GP every week so the more consistently you raid, the higher priority rating (PR) you will have.

These are subject to change and will be amended if necessary to reflect changes in the group.