Reporting the gender pay gap: a 3-step process

1. Understand what’s
in and what’s out

The final details of the regulations, published at the end
of 2016, provided us with greater clarity over what data should, or should not,
be included and contribute to the final average.

You’ll need to familiarise yourself with the definitions
outlined in the regulations as they have increased the scope of who should be
considered an employee. Consultants, self-employed workers and independent
contractors should all be included – although previsions exist to omit these
employees if “it is not reasonably practicable for employers to obtain the
data”.

The regulations also say companies can exclude employees if their
pay is not at their normal rate. This may affect anyone receiving statutory pay
due to maternity, adoption, parental or shared leave or because of sickness.

At the same time, companies need to include additional
allowances in the figures, for such things as London weighting or a shift
allowance, but then are not required to include overtime. So, we’ll need to be
clear on what constitutes shift pay.

2. Deep analysis

Although the average figures produced will offer a high-level
picture of what’s happening in your company, it’s likely you’ll want to offer a
fuller explanation as to why any significant gender pay gap may exist.

To understand your own figures, you’ll need to go further
than the legal stipulations and provide some commentary. In my previous blog, I explained that a failure to do so could invite interested parties
to simply draw their own conclusions. To prevent any misinterpretation of the
findings, I recommend you investigate why any gap may exist.

You’ll, therefore, need to review what may be impacting
gender pay levels. This will include the composition of the workforce, pay and
bonus structure, progression paths and career breaks.

3. Taking action

If the results do throw up a surprise or two, you may want
to address this before the figures are published. These are not likely to be
quick and easy decisions, however.

There will need to be internal
discussions at a senior level – and everyone will appreciate as much time as
possible to make those decisions. Conducting all the necessary analysis
required well in advance will allow time for this.

Once these actions have been decided upon, you’ll  also want to ensure the reasoning behind those
decisions are properly explained to those taking an interest – this includes
political groups, the media, your own employees and potential recruits.

The more time you give others in your company to prepare for
the actions they will have to take, the better the outcome is likely to be for
all.