30 April 2019

The latest reporting cycle in the UK captured employers' Gender Pay Gap position as of April 5th, 2018 with a reporting deadline of April 4th, 2019 for private and voluntary companies (March 31st, 2018 and March 30th, 2019 for private sector companies).

Little change in the headline numbers – but this was expected

Based on Curo’s analysis of data as of April 18th, 2019, the number of companies reporting increased from last year 10,677 with 37 companies already reporting their 2019-20 Takeaway Imagefigures and 365 companies with under 250 employees voluntarily reported an increase on last year.

Over 2,000 companies reported in the last 7 days, which was disappointing and continues to suggest many have not put the processes in place to easily produce the metrics required by the legislation.

The figures proved somewhat static, with the Mean Pay Gap slightly decreasing from 14.3% to 14.21%, whilst the Median Pay Gap rose from 9.2% to 9.5%.

The median hourly gap grew in 51% of companies, and shrank in 41% of companies. Many, when explaining their pay gaps, will say that a strategy to recruit more female talent at entry level will cause gaps to widen initially, but looking at pay quartile data this was only true for 31% of companies.

More than a quarter of companies pay women over 20% less than men based on median hourly pay while only 14% of companies pay women in favour of men.

From a sector perspective again there was no significant change. 11 out of the 21 sectors pay ahead of the overall median pay of 9.5%.  Two sectors who made biggest impact on closing the pay gap on a median basis were Human Health and Social Work (from 2% to 0.7%) and Administrative & Support Service (from 5.2% to 3.9%).  While those where the median pay gap grew most was Mining and Quarrying by 3.1% (17.6% to 20.7%) and Water Supply, Sewage, Waste Management (from 6.9% to 7.6%). Construction & Financial and Insurance Activities still topped the sector comparison table with the largest median pay gaps.

Across all pay quartiles female representation increased marginally but the upper pay quartile remains resolutely populated by 60% male.

The reports show that little has changed since the first mandatory gender pay reports were published a year ago. There is definitely a need to stop over analyzing the figures, and rather focus on what the numbers represent. There also needs to be a shared understanding that many of the factors impacting the gender pay gap will not be remedied quickly.

Realization that action plans may need to be mandatory to drive change

Of the 10,564 companies reporting, 26% provided no link to a report so are missing the opportunity to tell their story.  For many this link included on the government’s website was just a link to their website.

The UK Equality and Human Rights Commission said in a report published last summer that only one in five companies have put in place a gender pay action plan with specific targets. A number of bodies have stated that all employers should be required by law to publish a narrative report setting out the organizational context, current activity and future plans alongside their gender pay gap figures.

Interestingly the Irish Government’s Gender Pay Gap Information Bill which was finally was published in April 2019 does require compulsory reporting on the reasons for any gender pay gaps and the measures (if any) that the employer is taking to eliminate or reduce the gender pay gap.

Employers need more help interpreting Gender Pay Gap figures?

If you need help understanding your figures the GEO has produced some guidance here “Eight ways to understand your organization’s gender pay gap” to help understand the specific causes of any pay imbalances.

As well as doing your headline metrics a more meaningful analysis would be to set up processes to analyse gender balance in the following areas:

  • Number of applicants
  • New hires by job level
  • Promotions by job level
  • Tenure in job grade
  • Age distribution
  • Employee turnover by job level
  • Number of part time versus full time employees
  • New hire salaries
  • New promotes salaries
  • Salary/Bonus allocation during annual review
  • Number of ad hoc increases/spot awards
  • Performance rating allocation
  • Take up of part time or reduced hours working by gender

These will enable you to gain a greater understanding of some of the issues that may be driving pay gaps as well as female representation and progression.

5 things to do for 2019 reporting

Our key recommendations for this year are:

  1. Ensure consistent and accurate reporting;
  2. Report early to give yourself time to understand your numbers;
  3. Outline your action plans and goals;
  4. Prepare for ethnicity reporting;
  5. Understand this is not just a UK issue, increasingly multinational companies are tackling pay equity on a global basis.

To find out more, submit your email address to receive a copy of our infographic showing the latest numbers:

or visit https://www.curocomp.com/software/curogpg/.

We will also be at the WorldatWork Total Rewards Conference and Exhibition taking place May 6 – 8, in Orlando. Conference attendees interested are encouraged to visit Booth No. 912 for product demos and additional information. 

Posted by Ruth Thomas

Industry Principal, Curo.

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