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Gender Pay Gap Report 2017

3 Apr, 2018

Gender Pay Gap Report 2017

Gender Pay Gap Report 2017

Introduction

Employers with 250 or more relevant employees are required to publish gender pay gap information by April 2018, based on data from April 2017. The government will also encourage smaller organisations to report their gender pay gaps on a voluntary basis. This report provides your organisation with the necessary metrics to meet the publication requirements.

Additionally, XpertHR has provided relevant benchmarks to enable your organisation to see how its gender pay gap compares with other similar organisations.

Details

This report has been prepared in line with the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 and Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017.

Snapshot date: 5 April 2017 (private sector) or 31 March (public sector)

Please note that your organisation’s name has been replaced by its XpertHR installation code throughout to provide an additional layer of privacy and data security.

 

Your Data submission

Brightwork submitted data for a total of 1601 workers of which 1601 were categorised as “relevant employees” and used in the reporting of bonus pay gap statistics. 1585 employees were classified as “full-pay relevant employees” and were used in the reporting of hourly pay gap statistics.

Mandatory metrics for your gender pay gap report

This report has been produced by XpertHR at the request of Brightwork. The metrics within the report are intended to help Brightwork to meet the gender pay gap reporting requirements.

  1. The mean gender pay gap for Brightwork is 7.7%
  2. The median gender pay gap for Brightwork is 11.0%
  3. The mean gender bonus gap for Brightwork is -188.1%
  4. The median gender bonus gap for Brightwork is -18.2%
  5. The percentage of:
    • male employees in Brightwork receiving a bonus is 16.9%
    • female employees in Brightwork receiving a bonus is 14.5%
  6. Brightwork pay quartiles percentages (number of employees in each band):
Band Males Females Description
A 59.8% 40.2% Includes all employees whose standard hourly rate places them at or below the lower quartile
B 59.1% 40.9% Includes all employees whose standard hourly rate places them above the lower quartile but at or below the median
C 70.7% 29.3% Includes all employees whose standard hourly rate places them above the median but at or below the upper quartile
D 75.1% 24.9% Includes all employees whose standard rate places them above the upper quartile

The figures set out above are based on the data supplied by Brightwork and have been calculated using the standard methodologies set out in the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017.

XpertHR has used its best endeavours to provide Brightwork with an accurate picture of its gender pay gap and with external benchmarks to set the data in context. This report should not be taken as advice to take any specific actions, and XpertHR accepts no liability for any inaccuracies or errors, or for any actions or inaction on the part of Brightwork.

Your benchmarks: introduction

These pages benchmark your organisation’s data against benchmarks derived from participants in the XpertHR Gender Pay Gap Reporting Service:

  • Whole sample – all organisations
  • Sector – organisations in the same broad sector
  • Industry – organisations in the same industry
  • Turnover – organisations with a similar annual turnover
  • Employees – organisations with a similar number of employees

Additionally, your results have been benchmarked against data from the Office for National Statistics Annual Survey of Hours and Earnings 2016:

  • All organisations (UK average)
  • Organisations in your industry

Headline result

The mean gender pay gap for Brightwork is 7.7%.

mean

Your benchmarks: mean gender pay gap

The mean gender pay gap for Brightwork is 7.7%.

This is the figure you would need to publish in your gender pay gap report.

This figure is based on:

  • A mean male hourly rate of £12.35
  • A mean female hourly rate of £11.40

How does this compare?

Group Mean gender pay gap (%) Mean gender pay gap (£)
Brightwork 7.7 0.96
Whole sample 17.4 4.54
Sector: Private sector services 21.3 5.74
Industry: Professional and business services 20.7 6.22
Turnover: Under £100 million 15.6 3.59
Employees: 1000 – 4999 15.8 3.61
National Statistics
(ASHE 2017)
All employees: 17.4; Professional, scientific and technical: 21.8; Admin and support services: 8.8 All employees: 3.06; Professional, scientific and technical: 5.00; Admin and support services: 1.20

Summary

At 7.7%, the mean gender pay gap for Brightwork is significantly below the whole sample figure. It is significantly below the figure for organisations in the same sector and significantly below the figure for organisations in the same industry. It is significantly below the figure for organisations with a similar financial turnover and significantly below organisations that have a similar number of employees.

 

 

Your benchmarks: median gender pay gap

The median gender pay gap for Brightwork is 11.0%.

This is the figure you would need to publish in your gender pay gap report.

This figure is based on:

  • A median male hourly rate of £11.11
  • A median female hourly rate of £9.88

How does this compare?

Group Median gender pay gap (%) Median gender pay gap (£)
Brightwork 11.0 1.23
Whole sample 15.2 3.34
Sector: Private sector services 17.7 4.07
Industry: Professional and business services 20.6 5.01
Turnover: Under £100 million 13.4 2.60
Employees: 1000 – 4999 14.5 2.87
National Statistics
(ASHE 2017)
All employees: 18.4; Professional, scientific and technical: 22.3; Admin and support services: 9.6 All employees: 2.52; Professional, scientific and technical: 4.13; Admin and support services: 0.98

 

Summary

At 11.0%, the median gender pay gap for Brightwork is significantly below the whole sample figure.  It is significantly below the figure for organisations in the same sector and significantly below the figure for organisations in the same industry. It is below the figure for organisations with a similar financial turnover and significantly below organisations that have a similar number of employees.

 

 

Your benchmarks: mean gender bonus gap

The mean gender bonus gap for Brightwork is -188.1%.

This is the figure you would need to publish in your gender pay gap report.

This figure is based on:

  • A mean annual male bonus of £724.77
  • A mean annual female bonus of £2,088.24

How does this compare?

Group Mean gender bonus gap (%) Mean gender bonus gap (£)
Brightwork -188.1 -1,363.48
Whole sample 23.0 3,359.92
Sector: Private sector services 29.2 5,060.98
Industry: Professional and business services -3.7 2,269.58
Turnover: Under £100 million 24.0 2,425.85
Employees: 1000 – 4999 19.2 2,204.48
National Statistics
(ASHE 2017)
All employees: 71.0; Professional, scientific and technical: 49.6; Admin and support services: 41.9 All employees: 1,652.00; Professional, scientific and technical: 1,647.00; Admin and support services: 898.00

 

 

Summary

At -188.1%, the mean gender annual bonus gap for Brightwork is significantly below the whole sample figure. It is significantly below the figure for organisations in the same sector and [not available] the figure for organisations in the same industry. It is significantly below the figure for organisations with a similar financial turnover and significantly below organisations that have a similar number of employees.

 

 

Your benchmarks: median gender bonus gap

The median gender bonus gap for Brightwork is -18.2%.

This is the figure you would need to publish in your gender pay gap report.

This figure is based on:

  • A median annual male bonus of £242.00
  • A median annual female bonus of £286.00

How does this compare?

Group Median gender bonus gap (%) Median gender bonus gap (£)
Brightwork -18.2 -44.00
Whole sample 20.2 215.00
Sector: Private sector services 27.6 344.00
Industry: Professional and business services 20.6 480.25
Turnover: Under £100 million 18.9 167.50
Employees: 1000 – 4999 12.7 147.00
National Statistics
(ASHE 2017)
All employees: 44.1; Professional, scientific and technical: 41.9; Admin and support services: 17.4 All employees: 682.00; Professional, scientific and technical: 1,083.00; Admin and support services: 347.00

 

 

Summary

At -18.2%, the median gender annual bonus gap for Brightwork is significantly below the whole sample figure. It is significantly below the figure for organisations in the same sector and significantly below the figure for organisations in the same industry. It is significantly below the figure for organisations with a similar financial turnover and significantly below organisations that have a similar number of employees.

 

 

Your benchmarks: proportion of men and women receiving a bonus

The proportion of male employees in Brightwork receiving a bonus is 16.9%

The proportion of female employees in Brightwork receiving a bonus is 14.5%

These are the figure you would need to publish in your gender pay gap report.

How does this compare?

Group Males with bonus (%) Females with bonus (%)
Brightwork 16.9 14.5
Whole sample 43.7 42.4
Sector: Private sector services 49.2 47.7
Industry: Professional and business services 44.2 42.1
Turnover: Under £100 million 34.3 33.4
Employees: 1000 – 4999 44.0 42.0

 

 

Summary

At 16.9%, the proportion of men receiving a bonus in Brightwork is significantly below the whole sample figure. At 14.5%, the proportion of women receiving a bonus is significantly below the whole sample figure.

 

 

Your benchmarks: gender pay quartiles

Brightwork pay quartiles, percentage in each band (number of employees in each band)

Band Males Females Description
A 59.8%  (237) 40.2%  (159) Includes all employees whose standard hourly rate places them at or below the lower quartile
B 59.1%  (234) 40.9%  (162) Includes all employees whose standard hourly rate places them above the lower quartile but at or below the median
C 70.7%  (280) 29.3%  (116) Includes all employees whose standard hourly rate places them above the median but at or below the upper quartile
D 75.1%  (298) 24.9%  (99) Includes all employees whose standard rate places them above the upper quartile

These are the figures you would need to publish in your gender pay gap report.

How does this compare?

Group Band A
(lowest paid)
Band B Band C Band D
(highest paid)
Brightwork Male: 59.8%
Female: 40.2%
Male: 59.1%
Female: 40.9%
Male: 70.7%
Female: 29.3%
Male: 75.1%
Female: 24.9%
Whole sample Male: 49.8%
Female: 50.2%
Male: 56.9%
Female: 43.1%
Male: 62.4%
Female: 37.6%
Male: 68.4%
Female: 31.6%
Sector: Private sector services Male: 47.9%
Female: 52.1%
Male: 54.9%
Female: 45.1%
Male: 62.1%
Female: 37.9%
Male: 69.4%
Female: 30.6%
Industry: Professional and business services Male: 40.6%
Female: 59.4%
Male: 48.3%
Female: 51.7%
Male: 57.8%
Female: 42.2%
Male: 67.2%
Female: 32.8%
Turnover: Under £100 million Male: 50.7%
Female: 49.3%
Male: 57.3%
Female: 42.7%
Male: 62.0%
Female: 38.0%
Male: 67.5%
Female: 32.5%
Employees: 1000 – 4999 Male: 52.9%
Female: 47.1%
Male: 60.4%
Female: 39.6%
Male: 65.4%
Female: 34.6%
Male: 70.5%
Female: 29.5%

 

 

Causes of the gender pay gap

Many people are taken by surprise when they discover that their organisation has a gender pay gap. Their reaction is often to question the calculation because they know that they pay men and women equally. But this is to confuse two ideas.

It has been against the law to pay men and women differently for doing the same or similar jobs for decades. So while unequal pay rates can cause a gender pay gap, this is, thankfully, a relatively rare explanation for the gap.

A gender pay gap is much more frequently the result of structural issues – about where men and women are most often found within an organisation, and the sorts of salaries those roles attract.

So, across the whole UK economy:

  • Men are more likely than women to be in senior roles – especially very senior roles at the top of the organisation.
  • Women are more likely than men to be found in front-line roles at the bottom of the organisation in some types of organisation, especially those in retail or the care sector.
  • Men are more likely than women to be found in technical and particularly IT-related roles which attract higher rates of pay than other roles at similar levels of seniority.
  • Women are more likely than men to work part time, or to have had breaks that affect their career progression and long-term earnings.

Although the gender pay gap calculations required under the current Regulations attempt to adjust for the number of hours worked by calculating the gap based on an hourly rate, it remains a fact that part-time jobs are more likely to be lower paid than full-time jobs.

Figure 1 is typical of many organisations. It shows that at each level of the organisation men and women are receiving equal hourly rates of pay. However, although there are equal numbers of men and women in the lower-paid roles, there is an imbalance at more senior levels.

equ

This will translate into a higher average or median rate of pay for men than for women overall – and this is the gender pay gap.

Other organisational shapes can also translate into a gender pay gap. So, even if men and women are represented in equal proportions in mid-level and senior roles, there is likely to be a gender pay gap if women make up the bulk of the front-line workforce.

Sometimes, though relatively rarely, an organisation may have a negative gender pay gap – that is to say, the typical hourly rate paid to women is higher than the typical hourly rate paid to men. But the type of organisation where this is found may come as a surprise.

Data from the Office for National Statistics’ Annual Survey of Hours and Earnings shows that the mining industry as a whole has a negative gender pay gap. Some companies in other industries with a high volume of manual workers are in a similar position.

This is because they employ relatively few women, but their female employees are concentrated in relatively well-paid HR, finance, marketing and similar white collar professional roles. Having a high proportion of men in manual roles, meanwhile, tends to depress the average male pay rate.

The most common explanation for both positive and negative gender pay gaps, therefore, is not that men and women are paid differently, but that women are often absent from certain areas of the workforce.

 

 

How to understand your gender pay gap figures

Now that you know the headline gender pay gap figures for your organisation, you will probably want to understand the scale of the gender pay gap in your organisation and its causes.

Let us go through the main metrics in the order they appear in the report.

Mean gender pay gap

This metric shows the percentage gap in the average salaries (including bonus payments) of men and women based on standard hourly rates of pay during the pay period in which 5 April fell this year. The pay period is commonly a single week or single month. It is likely to become the default metric when comparisons are made between organisations because it is most easily understood. It is important to remember that almost half of all organisations will have a gender pay gap on this measure that is higher than the average. Your report flags whether your figure is close to the average (within 5% either side), higher or lower than the average (between 5.1% and 10% either side) or considerably higher or lower than the average (more than 10% either side). We also show where your organisation falls on the distribution curve of all organisations, enabling you to gauge how you compare against others.

 

Median gender pay gap

This shows the percentage gap in the median salaries (including bonus payments) of men and women based on standard hourly rates of pay during the pay period in which 5 April fell his year. The median is the middle value when all the values are ranged from highest to lowest. The median is more representative than the mean of typical pay differences because it is less affected by a handful of considerably higher (or lower) salaries. However this also means that it ignores one of the most significant factors in determining a gender pay gap: the sometimes very high pay rates of largely male boardrooms. It Is important to keep in mind that half of all organisations will have a gender bonus gap on this measure that is higher than the median and half will have a gap which is lower than the median.

Mean gender bonus gap

Both the mean and median gender bonus gaps are calculated from data for the full 12 months to April 2017. In addition to bonus payments, this includes commission and other types payments based on individual, group or whole company performance. The data excludes employees who either are not eligible for a bonus or who are eligible but did not receive a bonus. The gender bonus gap is typically higher than the gender pay gap because bonus payments are frequently skewed towards senior roles in which men make up a higher proportion of the workforce.

Median gender bonus gap

This provides an alternative way of looking at the difference in bonuses paid to men and women. It is important when reviewing both the mean and median gender bonus gaps to keep in mind that these figures are based purely on the data for that subset of employees who received a bonus. If a higher proportion of men than women receive a bonus, and the average or median bonus paid to men is higher than that awarded to women, then this exacerbates the gender divide.

Proportion of men and women receiving a bonus

Based on a broad definition of bonus which includes commission and other payments related to individual, group or company performance, this metric reports solely on those employees who were both eligible for a bonus payment and who received one. It therefore excludes those who may have been eligible but did not qualify for a payment. To understand this metric further, it is important to investigate not just whether there is a gender disparity but why. Possible causes could include a greater proportion of men than women in senior roles, or the existence of bonus schemes in functions where there are more men than women, or differences in the way men’s and women’s performance is assessed.

Pay quartiles by gender

Of all the metrics, this is the one most likely to shed light on the underlying causes of any gender pay gap in your organisation. This section of the report divides the workforce into four equally sized groups based on their hourly pay rate, with Band A including the lowest paid 25% of employees (the lower quartile) and Band D covering the highest paid 25% of employees (the upper quartile). In order for there to be little or no gender pay gap, there would need to be the same ratio of men to women in each quartile band. An organisation with a high ratio of men to women in Band D is likely to have a gender pay gap, as is an organisation with a high ratio of women to men in Band A. It may be the case in historically male-dominated industries that women are found mostly in Bands B and C, occupying mid-level, often office-based roles, but rarely found either on the shop floor or in the boardroom.

 

Further analysis

Where there is no obvious explanation for a gender pay gap, the first step should be to conduct an equal pay audit.

XpertHR publishes a range of guidance on how to do this, including:

At its simplest, an equal pay audit should compare the pay of men and women at each level of the organisation. However, a more thorough exercise may represent a substantial commitment of time and effort. Among the questions it should address are:

  • Do men and women in similar roles receive the same rates of pay?
  • How do the starting salaries of men and women compare?
  • How quickly do men and women progress through salary bands?
  • Are men and women to some extent segregated by function or occupational group?
  • Are special payments, such as unsocial hours’ allowances, more likely to be made to groups in which men are overrepresented?

 

What can I do to address a gender pay gap?

Where an investigation identifies differences in the pay of men and women in similar roles the solution is relatively straightforward: pay rates will need to be aligned to comply with the law or the organisation is likely to face an employment tribunal claim.

Usually, however, this is not the case.

First, the organisation needs to assess whether or not it wants to address any gender pay gap identified during the investigation. If the gap is within a range of a few percentage points, any discrepancy may simply be a matter of chance rather than the result of any systemic problem.

More likely, the issues will be deep-seated, long-standing and structural. A comprehensive response to dealing with these issues could involve:

  • Introducing an analytical job evaluation system;
  • Reviewing the pay and grading structure;
  • Adjusting pay rates (including ring-fencing salaries for those identified as over-paid);
  • Reviewing performance-related pay systems;
  • Introducing regular monitoring and reviews of pay and progression;
  • Training line managers in non-discriminatory recruitment practices;
  • Reviewing the qualification and experience requirements for new recruits; and
  • Signing up to sector-wide initiatives on gender such as the Women in Finance Charter.

None of these is a short-term solution. In some cases, the organisation’s scope to act will be limited. It is not, for example, possible for any individual employer to increase the number of IT graduates coming out of universities. However, it is possible to review and reconsider whether an IT degree is a necessary qualification, or to consider offering access or training programmes for those without the necessary knowledge or skills.

 

Publishing your gender pay gap metrics

The Gender Pay Gap Regulations require all employers with 250 or more employees to publish the six key metrics set out for you at the start of this report.

The Regulations state that the metrics must be published:

  • By 4 April 2018 at the latest;
  • On a publicly accessible website;
  • In English;
  • For not less than three years.

In addition, the data must be uploaded to a government website. This site can be found here: https://www.gov.uk/report-gender-pay-gap-data.

The published metrics must be accompanied by a written statement that confirms the information is accurate and which is signed by a director, designated partner or similarly senior employee. A full list is set out in s14(2) of the Regulations

Many employers will be concerned that simply publishing the required metrics alone could damage their reputation, create problems with existing employees and potentially deter future job applicants. There are, however, a number of steps that employers can take to mitigate this risk.

Provide commentary to set the numbers in context

Publication of a gender pay gap figure alone may raise a number of questions in the minds of employees, potential employees and other stakeholders in the organisation. Why is there a gender pay gap at all? What factors make it as large as it is? What steps is the organisation taking to address it? An employer that has carried out further analysis of its employee data will be able to provide context, and an accompanying statement may be able to point out that the organisation pays men and women in similar jobs equally, while conceding that it has fewer women than men in senior roles. It may point out that it has a smaller gender pay gap than other similar organisations. It may point to other work aimed at ensuring equality, including training and development initiatives, flexible working programmes and similar initiatives.

Consider what other data you may wish to publish alongside the legally required metrics

Although employers are obliged to publish the six key metrics, calculated in line with the Regulations, there is no reason not to publish other data alongside them which offers a fuller picture. Tables demonstrating that the overall gender pay gap is not reflected in salary comparisons for each job level, which calculate the pay gap on a different basis, or which show how the organisation has made progress over time may show the organisation in a different light.

Draw up a communication plan for employees

The gender pay gap is not an easy concept. Many employees may take an interest in any metrics that the organisation publishes, but without a framework within which to interpret and understand the figures for themselves, they may draw conclusions about the organisation’s approach to equality which are simply wrong. It is important that the organisation prepares the ground ahead of publication, explains the data that is being published and why it is being published, and is prepared to answer employees’ legitimate questions and concerns.

In general the guidance to employers faced with the prospect of publishing gender pay gap data for the first time is to be proactive about the message they present. If you do not tell your own story, someone else will tell it for you.

Other issues to consider when publishing the metrics include:

  • Who will sign off the metrics for publication? There is no definitive right answer to this. Many HR directors will wish to sign off the data themselves, and may do so provided they meet the qualification set out in the Regulations. Others, however, are already planning to pass this responsibility to the finance director or chief executive. In these instances, the HR and reward team should engage with the relevant director at an early stage in the process so that they are aware of the legal requirements and have confidence that the data is accurate.
  • Where and when will the metrics be published? Although the metrics must be published on a publicly accessible website, there is no requirement that they should exist as a standalone report or web page. Some employers may prefer to include the metrics in their annual report, while others will wish to publish them separately. In either case, although the deadline for publication is 4 April 2018, there is no requirement to wait until that date.

 

How your gender pay gap metrics are calculated

Your metrics

Only certain individuals in your organisation are relevant employees for the purposes of this report. Individuals based outside of Great Britain, or those not classed as employees have been excluded from the analysis. This means that only individuals whose status was given as either full-pay employee (employment status 1 on the questionnaire) or reduced-pay employee (employment status 6 on the questionnaire) were used to calculate the results contained in this report.

Hourly pay has been calculated as the sum of base pay, allowances, piecework pay, paid leave, premium pay and bonus attributable to the relevant period divided by the number of weeks in the relevant period and then further divided by the number of contracted hours in a working week. Only full-pay employees are considered when metrics based on hourly rates of pay.

The bonus amount has been calculated as the sum of incentive pay, long-term incentive pay and the value of shares within the 12 month preceding the relevant date. Individuals with zero or missing values for bonus are not included when calculating mean bonus.

Full-pay employees are allocated into pay band quartiles by way of whole company rankings based on their hourly rate of pay. Where there are ranking ties the mean quartile band has been assigned to all tied individuals.

Comparison metrics

Gender pay gap benchmarks, with one exception, are based on the whole sample, sector, industry, turnover and number of employee have been calculated as the mean of all matching organisations’ results. The single exception is for median bonus gap benchmarks where the mean average is overly distorted by outliers and is substituted with the median. Benchmarks are calculated from the latest available data at the time of report production.

The comparisons contained within the summary boxes on most pages should be understood as follows: significantly above, your organisation’s figure is 20 percent or more above the comparison figure; above, your organisation’s figure is 5-19 percent above the comparison figure; broadly in line with, your organisation’s figure is within +/-5 percent of the comparison figure; below, your organisation’s figure is 5-19 percent below the comparison figure; and, significantly below, your organisation’s figure is 20 percent or more below the comparison figure.

Please note that pay band quartiles benchmarks are still calculated per organisation in this instance ie, individuals are placed in the quartile pay band for their own organisation and not across the whole sample.

Additional benchmarks from the Annual Survey of Hours and Earnings, provided by the Office for National Statistics, have also been provided for mean and median pay and bonus metrics. These benchmarks are listed at the bottom of the comparison table under the heading of National Statistics (ASHE 2017). The metrics for all employees and the closest available standard industry classification matches have been provided.

 

 

Additional resources on XpertHR

 

Gender pay gap reporting

 

Job evaluation

 

Pay and grading structures

 

Equal pay audits

Lynsey Dellett