Gender Pay Reporting for the HR professional
Updated: Sep 2, 2020
As I approach my 40th year, I have started to think about the world around me and specifically the world of work and how it has changed in the 20 odd years that I have been engaged in the world of work. If I think right back to my school days and early university days, I remember the phrase ‘the glass ceiling’ being discussed, a lot, and so I decided to write my thesis all about feminism and the glass ceiling. I don’t really remember all of my conclusions, but I can certainly remember some of the reasons for why I felt it was so important to consider the role of women in the workplace.
So twenty years on, what has changed? Has anything changed? Well, a lot and not so much is what my gut instinct tells me. We’ve come a long way in terms of defining what equality means, breaking down the specifics if you like. We’ve also come some way in understanding the factors that make it perhaps more challenging for women in the world of work. It’s been widely discussed that the inequality that women experience has a direct impact on their own health, wellbeing, as well as the fact that they often earn less and therefore their future career is shaped by the amount of their earnings. The inequality itself can take a number of forms and I’m certain that for many women reading this, they can think of examples. For anyone who isn’t clear… being overlooked for a promotion or even another job in the department, experiencing conflict in male oriented workforces, sexual harassment or differences in pay are just some of them. What we do know is that women in their 20’s are now experiencing pay gaps at an all-time low, but women in their 30s, 40s, 50s and beyond haven’t seen any significant changes and are still receiving up to 35% less in the workplace.
There has been significant research that suggests that by acknowledging, understanding and looking to improve gender inequality, it could increase the UK Economy along by up to 150 billion. Even just identifying the pay gaps and rectifying could increase it by 80 billion alone, according to a study by PWC in 2015. The government started to address these statistics in 2015 and in April 2017 introduced legislation that required all UK organisations with 250+ employees to have to provide ‘gender pay reporting’. So since 2018 we have seen data emerge across the public, private and volunteer sectors on the inequalities that can be found and in some cases, additional narrative to understand why this could be the case and what can be done about it. If organisations fail to report on this, the Equality and Human Rights Commission (EHRC) can investigate and take matters further under enforcement.*
Equal Pay vs Gender Pay Gap
It’s important for employers to recognise the differences between equal pay-something which has been illegal since the 1970 Equal Pay Act and gender pay gaps. Equal pay refers to the fact that it is illegal to pay men and women differently for jobs of the same value i.e. A woman should not be paid less than man who is doing exactly the same job as her.
The gender pay gap is calculated by taking the average (median or mean) of hourly pay and any bonuses paid across an entire organisation. Within organisations, you could then identify specific departments or even locations where there may be gaps.
External and Internal Factors
If you asked the average person walking down the street, what would they most likely say are the reasons for the gender pay gap? The fact that women take maternity leave? More women work part time or reduced hours? Childcare? Age? Research conduced in 2018 by the Office of National Statistics concluded that there are both external and internal factors that contribute to the gaps. External factors included availability of childcare/elder care, job perception, proportions of male and female apprenticeships and the age of employees.
Internal factors included the way in which pay and bonuses are decided, organisational structure and reporting, promotion selection criteria, flexible working opportunities and the language of and way in which roles are recruited for.
The way forward
This has most definitely been a whirlwind through the intricacies of gender pay reporting and inequality of pay within the workplace, but if you’ve got this far, you probably want to know what steps you can take to ensure that you make your organisation as fair as it can be and equally as HR professionals, how we can play a pivotal role in the future of pay equality.
· Starting the discussion – First things first, start the conversation about gender pay reporting, understand what it means, what you need to do and when you should do it. You can then start to think about how you can collate the information, what support you will need internally to do this and once it’s collected, what do you need to do with it.
· Take an all inclusive approach – Look at all of your salaried roles, consider all of your bonus payments, review all of your commission structures and even your pension contributions. Make sure you that you have strong, fair processes for reviewing all of the above and that all of your managers and colleagues understand why it’s important.
· Are you representative? – Look across at your competitors, your industry leaders, are you trailing behind or are you a trailblazer when it comes to representation across your workforce i.e. women and men in every sort of role.
· Make a commitment – Ensure that all of your senior management or leadership are invested in the future and put together a ‘statement of intent’. This can help you to understand who you are attracting, retaining, recruiting and engaging with and will set the right tone for your organisation that equality is important and key to your success.
· Plan for now and the future – Make a plan and make it part of your strategic objectives, particularly if you discover large gaps in your organisation, when it comes to pay. Even if you are above average or working to a great standard, think about how you can do even better, how can you teach others and lead the way?
So there you have it, gender pay reporting in a nutshell. It’s a subject that I am fascinated by and will continue to do whatever I can to support organisations understand the importance of gender pay gaps and the connection with the future successes. Over the coming weeks, months and years ahead HR are going to be at the forefront of supporting organisations get back to work, work flexibly and support the economy as best they can. It’s up to HR professionals to have all the tools that they will need and for me, having this tool in your toolkit will be invaluable.
If you’d like to understand more about gender pay reporting you can do so here: