Gender Pay Gap Reporting

Insight

Setting Gender Pay Gaps in Context

Naming and Shaming

Every year the press, including the Financial Times, Guardian and Grazia “name and shame” employers with higher than average pay gaps. These pay gaps are presented as evidence of wrong doing, where employers intentionally reward men at a higher rate than women. Bad intentions can cause gender pay gaps, but usually the pay gaps simply reflect the distribution of men and women within a pay scale. Gender pay gap reporting does not tell us anything about whether an employer is providing equal pay for work of equal value.

Let’s take an example of ABC Ltd, where every single job has been objectively evaluated, and all jobs which are the same or a similar size are paid the same, regardless of the sex or other protected characteristic of the employee. ABC Ltd can demonstrate that it is providing equal pay for work of equal value. Simultaneously, depending on the composition of staff and the distribution of male and female staff throughout pay quartiles, ABC Ltd could have significant gender pay gaps, and could be “named and shamed” by commentators who quite frankly do not accept that the existence of a gender pay gap is not a prima facie indicator of discrimination and bias.

Being “named and shamed” can damage an employer’s profile, which is why it is advisable to consider how you present gender pay gap information. Regardless of whether your organisation’s pay gaps are comparatively high, it is still good practice to set the existing pay gaps in context and explain policies and practices which are in place to support the provision of equal pay for work of equal value.

How to explain the context of Gender Pay Gaps:

1. If you use job evaluation as a basis for pay and grading, then describe how this is done, and the checks and balance in place to ensure that job evaluation is nondiscriminatory, objective and analytical.

2. Refer to sector benchmarks. This can be done by referring to the Government’s Standard Industrial Classification (SIC) codes. You can filter gender pay gaps by employer type and SIC codes within the plenary gender pay gap reports.

3. You are not obliged to provide male and female headcount numbers, but these numbers can assist in explaining pay gaps. For example, an employer in retail could have 250 female staff and 50 male staff. The vast majority of the female staff are front of shop workers. Their salaries are exactly the same as male front of shop workers. The fact that there are five times as many female staff as there are male will affect the pay gaps, as will the fact that there may be a proportionately higher number of men in management. 

4. Refer to recruitment data to assist with the explanation of occupational segregation. For example, an engineering company may have significantly fewer female applicants. Include details of any outreach work your organisation does to attract diversity and increase the pipeline of underrepresented groups.

5. Education and training data, which is available from organisations such as the Higher Education Statistics Agency and the Scottish Funding Council, and assistance with explaining  occupational segregation. For example, in 18/19, 19% of students who studied Engineering and Technology were female. This profile will filter through to industry and employment.

6. Include examples of policies and practices which are in place to assist with career progression, such as opportunities for continuous professional development.

7. Refer to family friendly policies and practices, such as flexible working, working from home, enhanced maternity pay.

8. Compare progress year on year, and explain the potential reasons for change.