Gearing up for the gap
12 March 2018
This article was featured in the April 2018 issue of the magazine.
With the deadline for gender pay reporting fast approaching, Lisa Gillespie, Moorepay’s HR services director, discusses the latest figures, the UK’s gender pay gap and what we can learn from the results
Organisations with 250 employees or more are to report on their ‘gender pay gaps’ by either 30 March 2017 (public sector) or 4 April (private sector). Yet, as at 14 February fewer than 1,000 employers had published their results (http://bit.ly/2yqbumA).
I’m not entirely surprised by this because, last year, I predicted that the results would make for uncomfortable reading.
The Simmance Partnership recently released the results of a report, which found that female sales directors earned, on average, £1,000 per week less than their male counterparts. No, that isn’t a typo – it is ‘per week’. That’s a staggering £52,000 less per annum.
Of course, gender pay reports are limited to organisations with over 250 staff members. However, this role-based report gives insight into the wider issue across the UK.
What are the trends so far?
Of an estimated 9,000 organisations expected to submit their data, around 950 firms have already revealed their figures (http://bit.ly/2yqbumA).
Some big companies, like Aviva, EasyJet and Virgin Money, have already submitted their results. Many report that, within their organisation, women’s median hourly pay rates are much lower than men’s. However, they say this is likely the result of having fewer women than men in senior roles and that men and women in the same roles are paid equally.
In the public sector (England only), where formal salary structures and grading have been in place for decades, some organisations have already published figures showing over 25% lower hourly rates for women.
Several local authorities have also demonstrated significant gaps. While this can be caused by a number of factors with very innocent explanations, the raw figures, so far, are undeniable.
I’ll be very interested to read new public-sector figures as they are published. Since the public sector is, by nature, heavily unionised, I predict April 2018 will give trades unions something to get their teeth into for a long time to come. Gaps equal disputes; just think about the furore, which continues to grip the BBC.
...administering back-dated claims for current and past workers is hugely burdensome
Disputes and claims
Disputes run the risk of equal-pay claims – and equal-pay claims equal big awards. In the last few months, Sainsburys, Tesco and Glasgow City Council have all been dragged through the courts in equal pay battles.
Glasgow City Council lost its battle, despite arguing that it introduced the workforce pay and benefits review scheme (WPBR) in 2007 to remove gender pay inequalities. Female workers argued this too is discriminatory, claiming that the way WPBR is structured has resulted in those women working in mainly female roles are being paid as much as £3 an hour less than people in male-dominated roles.
Such claims are very bad news for organisations because the cost of administering back-dated claims for current and past workers is hugely burdensome.
Advice for employers
So what should organisations be doing in these last few weeks before they must publish?
Identify the gaps, and the potential cause(s).
Set out clear and simple explanations where a genuine reason exists. If identifying defensible reasons is proving difficult, decide what to do to address the situation.
It’s impossible and costly to implement new pay structures immediately. Therefore, work out short-, medium- and long-term plans to get the organisation into better shape. If the organisation is unionised or has a workers’ representative body, start a dialogue. Don’t wait for them come to you.
Closing the gap
We are likely to see the gaps closing in large organisations, but when will we see gaps closing, by role, at a national level?
Factors such as geography and tenure will always skew results but as a nation we do need to tackle the underlying myth that women in work are worth less than men. Such out-dated attitudes in a country boasting three female leaders, Theresa May, Arlene Foster and Nicolas Sturgeon are, to be frank, quite shocking.
If you would like more information or advice on gender pay gap reporting, or general legislation guidance, visit www.moorepay.co.uk.