Gender Pay Gap Reporting – Done! What Next?

It’s been the hot topic over the last few months and has created headlines across all media channels. Importantly, it has also re-invigorated the debate and heightened the focus on pay equality and all associated issues.

As we now know, the publication of gender pay reports has identified that the overall UK gap in median pay is 18.4%, with the financial insurance sectors reporting the largest gap of 22.1%. Reassuringly, the social housing sector fared positively as one of the sectors with the lowest  median gap of 7.8%.

But having met the 4th April deadline to publish your Gender Pay Report – what do you do next?

Having published your results, or even if you were below the threshold for reporting, it may be tempting to take your foot off the gas.  However, more work is now needed to fully explore the reasons for any gaps and identify actions to ensure there is equality in pay, and other areas, across your workforce. The attention created by gender pay reporting can also be used as a catalyst to complete a full review of your HR and reward strategy, pay structures and associated policies.

Here are our 5 key pointers on what we think are the key things you should be considering next in response to gender pay reporting:

  1. Equal pay – It is important to recognise that a gender pay gap doesn’t necessarily mean that there is an equal pay issue. But a key question any organisation should be asking its HR team is – “can you provide me with assurance that there isn’t an equal pay issue in the organisation?” If you have a gender pay gap, a first action is therefore to complete a full equal pay audit to identify any key risk areas which warrant further investigation.
  2. Review pay / bonus strategies and approaches – Most organisations use either a job evaluation or market-based approach to determine salary levels. A job evaluation approach provides some protection against equal pay, but schemes need to be reviewed on a regular basis to ensure they remain fit for purpose. Market based approaches link pay directly to the market, which is positive for recruitment and retention but can lead to some inbuilt gender bias in salary levels. Whatever approach you decide, now is a good time to revisit your pay strategy to ensure that it is achieving what you want it to.
  3. Talent management – One of the most common reasons cited for gender pay gaps has been a high number of men in senior, high paying roles i.e. the ‘glass ceiling’ effect. Longer term learning and development initiatives, especially around unconscious bias training, are critical to tackling this. Research shows that women are more likely to be impacted by bias at work.  Ensuring that this bias is identified and tackled in all organisational systems will make a big impact.  Reviewing recruitment and selection, reward and talent management policies and the behaviours of those involved in these will create a step change.
  4. Quick wins and practical solutions – Get in place actions that will have an immediate impact. Examples include –  inclusive flexible working policies (particularly shared parental leave); mentoring/sponsorship of women’s career development and reviewing company values to ensure that they support the agenda.
  5. Communication plan – A clear communication strategy is imperative to keeping stakeholders informed about what you’re doing to improve the gap. It’s important to be transparent and creating an ongoing narrative providing context around the numbers will really help.  It’s also worth considering being more open about your reward strategy and salary bands – creating these if they don’t already exist.  Organisational wide engagement here is key.

Gender Pay Reporting has acted as a catalyst for transparency in all areas of remuneration. What is clear is that the direction of travel in this area is only in one direction. All organisations should not only be responding directly to the issues raised by Gender Pay Reporting, but also beginning to prepare for other areas such as ethnicity pay reporting, chief executive ratios etc.

Tackling these issues head on now will prepare you well for increased transparency in all of these areas in the future.

If you’d like to know more about our HR services or how we can help with a review of any element of your reward and remuneration package, get in touch:

Kimberley Wallace – Consultant – or 07585 954 218

Alex Dellot – Principal Consultant – or 07741 631 194