Gender pay audits 2022: first reactions

This year’s average gender pay gap seems to have widened slightly. What will it take to make real progress?

Boys, Girls

 

So the date for filing gender pay audits has passed, with the Equalities and Human Rights Commission threatening additional penalties for those who miss the deadline two years in a row. Now we get to analyse the results. The bald figures often don’t tell the entire story, which is why the gender pay bot on Twitter can seem a little unfair if understandable given the very slow pace of change.

It’s what employers are doing and whether what they are doing is effective that matters. Sometimes doing something which might have a positive impact – for instance, hiring more women graduates at the lower levels of a male-dominated company in an attempt to improve the pipeline can increase your gender pay gap. Sometimes just one woman leaving her post at the top of a company can skew the figures, even if there are more coming through at lower levels. easyJet, which has one of the highest gaps this year, blamed Covid for its high figures, saying they were affected by cabin crew being more likely to be female and to be on furlough at the time of reporting while pilots, mainly men, were not.

Change can take time, but we don’t want to wait for ever. There needs to be more than just delivering the figures – or delivering them as late as possible to avoid standing out as if the whole process is just a bit of a PR game. There needs to be a commitment to address them and to narrow the many gaps that exist. If not those women who don’t see prospects for themselves will leave and others who might have joined will decide against it. Older companies have a more difficult job because it is harder to change patterns of recruitment and promotion once they are established and entrenched, but because something is hard is not a reason to shirk it. And in an age of tech there is no shortage of start-ups where women may find it easier to progress.

So while the gender pay gap figures are interesting it is the background to them that matters more – the analysis of where improvements can be made which will have greatest effect [not the tick box stuff] and the action plans about how to carry those improvements out, including drilling down into the data and ongoing monitoring.

What do this year’s figures show?

Nevertheless, it is important to keep an eye on the headline figures. Reuters analysis has found that most British financial companies collectively narrowed their gender pay gaps last year, but some went into reverse gear, including UBS and Deutsche Bank. Reuters collated pay gap data from 21 major financial institutions and found an average mean gender pay gap of 32.1% – slightly more than 1% narrower than the previous year’s average. Despite the improvement, the gap is much wider than the average for all UK employers, which stood at 14.9% in the year to April 2020. Goldman Sachs accounted for the industry’s widest gender pay gap among the firms surveyed, with men working for the bank in Britain getting 51.3% more in pay per hour than women on average. Insurer Admiral was the only financial firm to have a pay gap below the UK average, at 14.4%, although this widened from 12.8%. The analysis also included Barclays, HSBC, Lloyds, NatWest, Standard Chartered, Bank of America Merrill Lynch, JPMorgan, Morgan Stanley, Credit Suisse, PGMS, abrdn, Schroder Investment Management, St James’s Place, Legal & General and Prudential.

Construction, however, still seems to have the highest mountain to climb on gender pay equality. Meanwhile, the Chartered Management Institute’s analysis of the figures for the private sector shows that the average pay gap has increased, although the median hourly pay gap has narrowed from 10.2% to 9.8%. The CMI makes the point that it is not just women who suffer due to the ‘almost glacial’ pace of change. If one fairly significant part of the workforce feels that it is not being treated fairly and offered the same opportunities as others that it demotivating across the board. Employers who seek to encourage everyone to fulfill their potential will reap the most rewards. Ann Francke at the Chartered Management Institute says: “There are still far too many women in lower-paid junior roles and far too few women reaching the top. As a result, women will be hit hardest by the sharp rise in inflation and face the greatest increase in their cost of living.“



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