Gender pay gap reporting went live on 6th April 2017, with large employers having until 5th April 2018 to publish their reports. In an attempt to get ahead of the game, a number of the country’s largest organisations have already published their reports revealing some interesting results.
As reported in our December newsletter, the final form gender pay gap regulations were published on 6th December 2016. They require employers with 250 or more employees to report on the following 6 key metrics:
- Mean gender pay gap
- Median gender pay gap
- Mean bonus gender pay gap
- Median bonus gender pay gap
- Proportion of men and women receiving a bonus
- Proportion of men & women in salary quartiles
The reports have to be signed off as accurate and are to be published on both the organisation’s website and a government website. There is currently no obligation on employers to provide any narrative to accompany the statistics.
A number of large organisations have already published their reports, including Virgin Money, Utility SSE and PwC. The reports have revealed quite alarming gaps, with Virgin reporting that as at April 2016 they had a mean gender pay gap of 36% and a median gender pay gap of 39%. At first glance these figures are nothing short of shocking but what Virgin did when publishing this data was to include a narrative explaining the gaps and the steps they are taking to address them. In this regard they explained that the gap was as a result of under-representation at both senior and junior level. According to Virgin there are too few women in senior roles and too few men in junior positions, particularly customer service roles. To try and address this imbalance they announced in their report a package of measures including unconscious bias training for all managers, setting bonus targets for senior leaders to improve gender balance and continuing to promote flexible working.
Whilst Virgin’s report will no doubt have raised eyebrows amongst its workforce and the wider world, the strategy they have outlined in their report to close the gap goes some way to lessening the impact. The real test of course will come when they publish next year’s report!
So what can we learn from the first published reports?
The most important thing to take from these early reports is the value of a narrative to explain the information. Statistics can be interpreted in many different ways and therefore it is vital to provide your own explanation and to try and set the figures in to context. It is also advisable to break the figures down, perhaps looking at the gap from a geographical, departmental or part time/full time perspective. This is likely to reveal a lot more about the causes of any gender pay gap. Likewise, looking at the proportion of men and women eligible to receive a bonus and not just those who actually received a bonus is arguably going to be more accurate.
How can we help?
We can work with you to analyse your gender pay statistics, breaking them down based on location/department/function to help give the most accurate snapshot of your business. We can help you identify the root causes of any pay differentials and formulate an action plan to tackle any issues with a view to closing the gap as quickly as possible.
We can also produce a narrative to sit alongside the report and explain the published information along with any steps you intend to take to reduce any gaps.
Any input you receive from us will be privileged which means it won’t be disclosed in the event of any equal pay claim.