Gender pay gap reporting

  • View

  • Download

Embed Size (px)

Text of Gender pay gap reporting

  • Gender pay gap reporting

  • Contents

    Whats it all about?

    Key definitions

    What data needs to be gathered?

    What calculations need to be made?

    Further analysis

    What to do now

  • Whats it all about?


  • Whats it all about?

    From October 2016 relevant employers will have to report a number of

    statistics about their relevant employees, as of the relevant date.

    The statistics that employers will need to report are as follows:

    Mean gender pay gap

    Median gender pay gap

    Mean bonus gap

    Bonus proportions


    Reporting will need to be undertaken annually with statistics published on

    the company website and left there for at least 3 years. The figures must

    also be reported to the Government.

    The Government has stated that it intends to use the figures to create a

    league table, showing how they vary by industry.

  • Key definitions

    (according to the draft



  • Key definitions

    Relevant employer

    a person who has 250 or more relevant employees on the relevant date

    Relevant employee

    a person (a) who ordinarily works in Great Britain; and (b) whose contract

    of employment is governed by UK legislation

    Relevant date

    the 30th April 2017 and each subsequent anniversary of that date

    Pay period

    the period (a) in respect of which the relevant employer usually pays

    that relevant employee, whether weekly, fortnightly, monthly or a longer

    or short period; and (b) within which the relevant date falls

  • Key definitions


    includes basic pay, paid leave, maternity pay, sick pay, area allowances,

    shift premium pay, bonus pay and other pay (including car allowances

    paid through the payroll, on call and standby allowances, clothing, first

    aider or fire warden allowances)

    does not include pay for a different pay period, overtime pay, expenses,

    the value of salary sacrifice schemes, benefits in kind, redundancy pay,

    arrears of pay and tax credits

    is to be calculated before deductions for PAYE, national insurance,

    pension schemes, student loan repayments and voluntary deductions

  • Key definitions

    Bonus pay

    payments received and earned in relation to profit sharing, productivity,

    performance and other bonus or incentive pay, piecework and


    long term incentive plans or schemes (including those dependent on

    company and personal performance)

    the cash equivalent of shares on the date of payment

    Gross hourly rate of pay

    is determined using the weekly pay divided by weekly basic paid hours

    for each relevant employee

  • What data needs to be gathered?

    Subhead style


  • What data needs to be gathered?

    Identify the entities

    Will need to identify the number of UK entities which appear to employ

    250+ employees (or which you expect to employ 250+ employees on the

    relevant date)

    Identify the relevant employees

    Include all those with a contract of employment

    BUT the Government has stated that it intends for a broader definition of

    employee covering workers, self employed contractors and possibly

    LLP members.

    Do not include UK employees working overseas (e.g. overseas


    Include anyone who is employed in the pay period in question, but also

    anyone who has received a bonus in previous 12 months

  • What data needs to be gathered?

    Data needed for each employee

    Male or female

    Grade and department/function

    Full time or part time (if PT their % of FTE)

    Permanent or fixed term

    Joined or left part way through year

    The employees pay period (i.e. are they paid monthly, 4 weekly, 2 weekly,

    weekly, etc. and what is the precise period in which 30 April falls for each


    Weekly contracted hours (in the case of salaried employees)

    Actual hours worked during the pay period (in the case of waged employees)

    Whether on maternity/paternity/shared parental/adoption/sick leave during the

    pay period.

  • What data needs to be gathered?

    Pay data

    Basic pay/salary during the pay period

    Maternity/paternity/ShPP/adoption pay

    Sick pay during the pay period

    Car allowance

    Any area allowances during the pay period

    Any other money allowances

    Shift premium pay (i.e. for anti-social hours, working bank holiday etc.) (but not


    Any commission paid in the pay period

    Any other bonus pay paid in the pay period

  • What data needs to be gathered?

    Bonus data

    General company bonus

    Performance related bonus

    Christmas bonus

    Recruitment bounty

    Sign on bonus

    STIP, LTIP and all other incentive schemes where shares are awarded, figures

    need to be the cash value of the shares.

  • What calculations do you need to make?

    A step by step guide


  • The calculations

    Calculate the hourly rate

    Divide the pay in the pay period by the hours for the pay period

    Mean gap calculation

    Find the mean for men by adding up all the hourly rates for men, divide by the

    number of men.

    Repeat for women

    Calculate the mean gender pay gap by subtracting the mean women hourly rate

    from the mean men hourly rate, dividing by the mean men hourly rate and then

    multiplying by 100.

    Median gap calculation

    Find the median for men. Find the median for women.

    Find the gap as with the mean above.

  • The calculations

    Bonus calculation

    Find the mean men bonus. Add up all of the bonuses received by men, divide

    by the number of men who received bonus.

    Repeat for women.

    Calculate the mean bonus gap by subtracting the mean women bonus from the

    mean men bonus, dividing by the mean men bonus and then multiplying by 100.

    Bonus proportions

    Calculate the percentage of men who received a bonus in the 12 months to 30

    April, out of the total number of men using the following calculation

    Repeat for women.

  • The calculations


    Two possible

    approaches and

    interpretations of what

    a quartile is no clear

    decision from

    Government yet on

    which is the correct


    Approach 1 is the

    statistical definition of

    quartiles and seems

    to be what Regulations

    intend, but approach 2

    has been referenced by


    Calculate hourly rates for all.

    Then, find the highest paid

    relevant employee and the

    lowest. Find the median. Find the

    relevant employee between the

    median and the highest paid, and

    the median and the lowest paid.

    You will have four equal sized

    groups of employees. Calculate

    the proportion of women within

    each group.

    Calculate hourly rates for all.

    Then, find the highest paid

    relevant employee and the

    lowest. Use the highest and

    lowest rates to create four

    equally sized pay bands. Count

    the number of relevant

    employees within each pay band.

    Calculate the proportion of

    women within each pay band.

    Approach 1 Approach 2

  • Further analysis

    What other analysis could be

    done to give context to the

    reportable figures?


  • Further analysis

    Questions to think about

    What is the position if you look at the figures by job grade? What about job title?

    How do the r