The deadline for companies with 250 or more employees to report their gender pay gap is only a fortnight away.
How are your gender pay gap comms going? I’ve been talking with clients about gender pay gap comms over the past few weeks and thought I’d share resources with you to help if you’re responsible for communicating yours.
I’ve outlined seven things to think about and encourage you to do your own research to ensure you are compliant and address everything that is required.
My biggest takeaway from all the reading I’ve been doing is the need to translate this transparent way of reporting into action.
I welcome the openness of the information. However, if you don’t couple it with an action plan of how you will address your gender pay gap, chances are you’ll be reporting a similar picture in 12 months’ time.
Have you communicated your gender pay gap? If so and you would like to share your thoughts and learnings with All Things IC’s blog readers, do please get in touch.
What is the gender pay gap?
Gender pay reporting legislation requires employers with 250 or more employees to publish statutory calculations every year showing how large the pay gap is between their male and female employees.
You must comply with the regulations for any year where you have a ‘headcount’ of 250 or more employees on 5 April. If you’re close to having 250 employees it’s worth checking the Acas guidance for more detail because there are specific rules. For example, each part-time worker equals one whole employee.
Is it the same as equal pay?
No. The gender pay gap differs from equal pay and should not be confused with it.
Equal pay deals with the pay differences between men and women who carry out the same jobs, similar jobs or work of equal value. It is unlawful to pay people unequally because they are a man or a woman for performing the same or similar work.
The gender pay gap is a measure of the difference between the average hourly earnings of men and women.
If a workplace has a particularly high gender pay gap, this can indicate there may a number of issues to deal with, and the individual calculations may help to identify what those issues are. In some cases, the gender pay gap may include unlawful inequality in pay, but this is not necessarily the case.
For more information on Equal Pay see: www.acas.org.uk/equalpay.
The gender pay gap shows the difference between the average (mean or median) earnings of men and women. This is expressed as a percentage of men’s earnings e.g. women earn 15% less than men. Used to its full potential, gender pay gap reporting is a valuable tool for assessing levels of equality in the workplace, female and male participation, and how effectively talent is being maximised.
Image source: https://genderpaygap.campaign.gov.uk
Who has a gender pay gap?
Nearly all employers will have a gender pay gap this year, and for most, these gaps will not be the result of unequal pay. (Source: CharityComms).
There are six basic calculations, but you will need to gather your information first and take your time working things out the first time round.
The calculations are:
1. Your mean gender pay gap
2. Your median gender pay gap
3. Your mean bonus gender pay gap
4. Your median bonus gender pay gap
5. Your proportion of males and females receiving a bonus payment 6. Your proportion of males and females in each quartile band. Source: ACAS guidelines
The gender pay gap varies by occupation, age group and even working patterns. For example:
- Whilst both public and private sectors need to take action to eliminate the gender pay gap, the gap tends to be higher in industry sectors such as finance, energy and construction sectors and lower in sectors such as public administration, support services and health and social work.
- Occupations where women are underrepresented typically produce higher pay gaps; these can be significant for senior level occupations such as finance and investment analysts.
- There is a gender pay gap even before the arrival of a first child. Unequal sharing of care responsibilities contributes to a higher proportion of women taking part-time work, which is generally lower paid. Consequently the gender pay gap widens, particularly for those employees over 40.
What causes a gender pay gap?
The causes of the gender pay gap are varied and overlapping. Some causes originate outside of the workplace, such as stereotypical representations of men and women and standards in careers advice and guidance for girls. Factors involving the workplace include:
- fewer women working in certain more highly-paid professions or areas of an organisation such as those involving science, technology, engineering and maths [STEM]
- unsupportive and rigid corporate cultures
- lack of well paid part-time/flexible work
- women remaining less likely to progress to senior levels in an organisation, making up just over a third of managers, directors and senior officials
- constrained individual choice, unconscious bias and discrimination – women keen to move into senior or managerial roles are sometimes held back by:
- a lack of diverse senior female role models; mentoring and or sponsorship; networking opportunities; particular assumptions about mothers not wanting, or not being in a position to accept, promotion.
There are plenty of actions an employer can take to tackle and reduce the gender pay gap.
“However, one of the first and most fundamental changes needed in many cases is greater transparency about gender pay difference. This greater transparency increases the likelihood that action will take place” – ACAS.
Where is it reported?
The information must be published on both the employer’s website and on a designated government website at www.gov.uk/genderpaygap.
An employer should then use that information to help understand any underlying causes for their gender pay gap and take suitable steps to minimise it. Benefits will differ between employers but can include developing a reputation for being a fair and progressive employer, attracting a wider pool of potential recruits for vacancies and the enhanced productivity that can come from a workforce that feels valued and engaged in a culture committed to tackling inequality.
When to publish the data and written statement
You must publish your data and written statement within a year of your organisation’s ‘snapshot date’.
For example, for businesses and charities, you must publish by 4 April each year. Public sector organisations must publish by 30 March each year. It makes sense to publish your data and written statement at about the same time, but there’s no rule about which to do first. There is no requirement for an employer to publish at the same time each year.
You must keep the information available online for at least three years.
Source: https://www.gov.uk/guidance/gender-pay-gap-reporting-what-employers-must-publish
Gender pay reporting and gender identity
Advice from ACAS states: “It is important for employers to be sensitive to how an employee chooses to self- identify in terms of their gender. The regulations do not define the terms ‘male’ and ‘female’ and the requirement to report gender pay should not result in employees being singled out and questioned about their gender.”
- As a starting point, most employers should be able to base reports on the gender identification the employee has provided for HR/payroll, if such records are regularly updated.
- Where this information is not available or may be unreliable, employers should establish a method which enables all employees to confirm or update their gender. This can be handled early and proactively when informing employees that gender pay reporting is taking place. It can be done by inviting employees to check their recorded gender, and update it if required. A free ACAS template communication is available at www.acas.org.uk/genderpay.
- In cases where the employee does not self-identify as either gender, an employer may omit the individual from the calculations. Source: ACAS.
Do I need to do anything else?
You also need to provide a written statement confirming that the calculations are accurate. This must be signed by an appropriate senior person, such as a director or Chief Executive.
Providing a narrative will help people to understand your view of why a gender pay gap is present and what your organisation intends to do to close it. All employers should add a supporting narrative – a gender pay gap does not necessarily mean they have acted inappropriately or discriminatorily but this will need explaining. A narrative helps anyone reading the statement to understand the organisation’s view of why a gender pay gap is present and what the organisation intends to do to close it.
I’ve done all that, what now?
First, publish the information somewhere accessible on your own website.
Then, you’ll need to place the information on the designated government website.
Further reading: What employers must publish.
How to communicate your gender pay gap internally
No two organisations will be the same, but the sooner you analyse your gap and identify the root causes behind it, the sooner you can address it.
By publishing an action plan alongside your figures, you can identify tangible steps your organisation is taking to close the gap.
This proves to your staff and stakeholders that, rather than simply complying with regulations, you are genuinely committed to achieving gender parity within your organisation. Source: CharityComms.
Seven things to consider when communicating gender pay gap:
- Don’t miss the deadline!
- Make sure your company website and the Government’s website both have your report.
- Follow the advice on the ACAS website and dedicated Government website to ensure you report all the relevant figures
- Think about the narrative and how you communicate the context internally
- Outline your action plan and commitments to employees in terms of addressing your gap.
- Bring the reporting to life internally with an internal campaign to support the figures.
- Share examples internally of how you are going to address or build on the figures uncovered by your report.
Who has communicated it well?
According to the BBC today, 51 out of the FTSE 100 companies have reported their gender pay gaps and two-thirds of companies are yet to report.
The Children’s Society were one of the first and you can see their whole report online. I’ve highlighted some of their sections below so you can see an example…
Liz Walker, Director of Finance & Corporate Services, The Children’s Society states: “Gender Equality is a significant part of this commitment to diversity and inclusion, which is why we welcome the implementation of mandatory gender pay gap reporting as one important step in terms of progression and transparency, and why we are working with the Government Equalities Office as an early adopter of this in the voluntary sector.
“Our gender pay gap report suggests that while we can be proud of our progress we have areas where we can do more to support gender equality. We have a mean gender pay gap of 17.26% and a median of 20.83% which, although comparable to the national average, is a pay gap that needs constant attention until it reaches 0%.
“When we break this down by quartile we see slightly different stories in our different pay ranges and so as well as actions that support the whole of our workforce, we will be specifically working to address the discrepancy we find in our upper quartile band of comparatively higher earners.
“I am pleased to be able to commit to firm actions in response to this Gender Pay Gap Report. We look forward also to publishing our updated Single Equality Scheme in 2018, which will provide a comprehensive road map of what we are doing to address issues of diversity and inclusion across the organisation and in our work.”
Top tips: What are you going to do about your gender pay gap?
A critical part of communicating your gender pay gap it outlining the context and actions. In other words, what steps are you going to take to maintain or improve what you’re doing?
How are you going to implement actions to reduce the gender pay gap? For example can you review staff bonus schemes, recruitment processes and career development opportunities.
If you do that, how long will it take for those changed to impact the organisation? What measures do you have in place to keep yourselves on track?
Here’s what The Children’s Society has communicated:
“At The Children’s Society, we are all too aware of gender disparity in the UK and we are committed to playing our part in tackling it.
- This is the first year we have reported on our gender pay gap and we will continue to do so. In response, we favour a thorough focus on clarity and transparency in our approach and more detailed analysis to understand what it means for our staff at a practical level.
- Before our next report, we will investigate what can be done to address the pay gap, particularly in the upper quartile.
- We will work with the Government Equalities Office to continue to seek advice and feedback to ensure legislative compliance but go beyond this to embed and pursue best practice.
- By April 2018, we will publish our new Single Equality Scheme that will outline all of our Equality, Diversity and Inclusion work over the coming years. Gender pay gap analysis will form a part of this to monitor internally throughout the year.
- We are likely to give prominence to the median average in our future analysis, recognising its suitability as a better indicator of typical pay.
Writing on the CharityComms website, Equality, diversity and inclusion (EDI) manager, Ben Shewry, explains what the team is doing and why it goes beyond compliance with the law.
“There were some key things that stood out to us from this whole process. The most important learning we took away can be summarised in three key areas:
- Where gender pay gap reporting fits into our ‘bigger picture’
- What the practical considerations are of compiling the data itself
- What our comms planning will look like.”
He has also provided information about the process:
“With a new initiative like this, there is always a discussion to have internally about who is responsible for the project and where it fits into your HR or organisational development planning. It’s not just a simple, standalone statistics exercise, so framing it within an organisational context has been important.
“There can often be a temptation to hand this to the data lead or team who will fire out one page of statistics to publish with no narrative or messaging about wider implications or action plans. Although this is compliant, it feels at odds with the principles of gender pay gap reporting and wouldn’t sit well with our approach to equality, diversity and inclusion at The Children’s Society. We took the stance that this would be very much an EDI project, carried out with the help of other teams like those involved in HR systems analysis, our pay and grading structures as well as senior leaders that are responsible for relevant key work like our People Plan. This is one of our five organisational priorities and aims to identify how we can become a high performing organisation, with engaged staff who feel supported to achieve all they can for children and young people.
“As it’s the first year of reporting, negotiating our way through the ‘nuts and bolts’ of the project and ensuring the data we extracted was compliant and rigorously scrutinised took a longer time than one may expect. Key to this was understanding the benefits and limitations of our HR systems in the context of pay gap reporting.”
Source: CharityComms.
Further resources and reading
- The gender pay gap – what charities need to know
- Managing gender pay reporting – ACAS
- Gender pay gap reporting – what you need to know – Gov website.
Sources: ACAS, CharityComms, Gov.uk.
Please ensure you read the appropriate guidelines to help you know how to accurately report your gender pay gap – this article is for guidance, I’m not a legal expert, do refer to the gender pay gap and ACAS websites for complete information.
Thank you as ever for stopping by. What do you think of what you’ve read? I hope it’s helpful if you are planning your gender pay gap reporting. Feel free to comment below or Tweet me @AllthingsIC with any comments.
Rachel
Post author: Rachel Miller.
First published on the All Things IC blog 22 March 2018.
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