Thinking Out Loud with Anna: A Guide To Gender Pay Gap Reporting

Thinking out loud with Anna Baréz-Brown – A guide to gender pay gap reporting. What’s next and how can we improve things?  

Anna Baréz-Brown is one of our two Shine for Women co-founders, providing knowledge and experience from working with thousands of women around the world: they are the beating heart in our fight for women’s inclusion.  

Here is a quick guide to understanding gender pay gap reporting. Society’s foundations were shaken from the onset of the Covid pandemic and the enforced lockdowns that came with it, because of this, the progress experienced from pay gap reporting has been impacted too. Looking ahead to this year, many may be filled with uncertainty in where we are headed, now that we are seeing glimpses of normality returning to our working lives. How can we improve things? Here are six simple steps to gender pay gap reporting and what needs to change for the reporting to be more impactful. 

If you are looking to achieve gender parity in your organisation, learn more right here.

Gender Pay Gap Reporting

The gender pay gap is the average difference between the pay for men and women who are working. Women are generally considered to be paid less than men. The gap is an important tool to remind companies of gender inequality, hold them accountable, and agree on a strategy and steps toward gender balance.

Six simple steps to gender pay gap reporting

1. Record and analyse the correct data 

2. Determine what is causing your gender pay gap.  

Key drivers of the gap include:  

• High quantities of women are taking on unpaid caring responsibilities. 
• High proportions of women in low-paid, part-time roles. 
• Differences in human capital (the economic value of a work’s experience and skills). 
• Men dominate some types of jobs (usually top-level) and women others. 
• Undervaluing of women’s work. 
• Pay discrimination (where a man is illegally paid more than a woman for work of the same value). 

3. Review your action plan – ensuring you’re organised and assess what is or isn’t working – actions taken to assess it.  

4. Tell your story – put the gender pay gap into context (protect or enhance the company’s reputation). 

5. Prepare your communications plan – make sure you equip people with the right information to draw attention to the positive steps you are taking.  

6. Submit your report – the 2022 deadlines were Thursday 31st March for public sector organisations and Tuesday 5th April for private and voluntary sector employers.  

When you published your data on your organisation’s website, you needed to make it easily accessible to employees and the public (no more than three clicks from your home page) and ensure it remains there for at least three years. 

What Has Been The Impact of Reporting? 

• A review from 2021 showed that gender pay gap reporting in Britain is making a difference. The research revealed that employers affected by the legislation had narrowed the wage gap between women and men by almost one fifth (19%) on average. 
• It has led to a 1.6% increase in women’s hourly wages correlating to men’s hourly wages. This means the gap narrowed by roughly 19% in these companies. 
• The impact was not driven by highly paid women moving in or low-paid women leaving but due to changes in individual workers’ wages. 
• The impact was driven primarily by men at employers who had to report the gender pay gap experiencing slower wage growth than those at comparable organisations not covered by the reporting policy. 

A researcher of the pay gap, Jack Blundell, asserted that “the gender pay gap is closing – this research shows that making employers accountable for their pay gaps can result in significant changes to pay, with employers narrowing their pay gaps to attract and retain workers. But the reporting policy has room for improvement, particularly around enforcement, and it remains to be seen whether these effects outlast the initial media interest in gender pay gap reports” (March 2021)

UK Reporting During The Pandemic

One of the hardest things about living with the pandemic is that, just when we thought it was all over in 2020, we circled back around again into another lockdown in 2021. It meant that people were working from home, furloughed with the loss of pay, or lost their jobs again. There have been clashing valuations of the impact of the pandemic on working women. Research has revealed that more women than men had been furloughed on reduced pay, made redundant or exhausted a larger percentage of their time juggling work with homeschooling and unpaid domestic duties.

As a result of this, there is a data black hole from the last few years and an uncertain picture painted of the future of the gender pay gap. Will the narrowing of recent years be unlikely now? Can we reform the reporting regulations to ensure they are fit for purpose in this ever-changing world?

What Needs To Change About The Gender Pay Gap Reporting?

We need to see changes to the review process to ensure that we accommodate for our current climate and amend the prevailing issues that cropped up over the pandemic. Here are some ways we can see changes to the system for the better:

✨Extension to smaller employers: only 250+ employees are obliged to publish gender pay gap statistics. Including companies with fewer than 250 employees means that the UK’s gender pay gap is calculated using the data of only about 50% of the UK’s workforce. Widening this scope of the regulations would be a great step towards greater transparency.

✨More forensic reporting: Breaking down statistics into pay quartiles provides a more nuanced picture of an employer’s pay gap

✨Mandatory action plans, not simply reporting but addressing it head-on: including more programmes like Shine – Shine acts as a trusted partner to get more women to the top by working on all levels from junior to mid-level and senior women with tailored workshops and one to one coaching while including the male population, and cracking open honest conversations that need to happen to accelerate systemic change.

✨Publication of part-time pay statistics: the generality of women in part-time roles is regularly expressed as a major contributor to the gap. Publishing the gap between full time and part-time pay would expose the inconsistencies in employer pay policies that unfairly target women.

✨Sanctions and enforcement measures, not just reporting: the regulations do not provide for sanctions against employers who fail to comply with their duty to report. This has long been a cause of controversy.

✨Need for reliable, representative, and comparable statistics – it is widely acknowledged that the biggest threat to gender pay gap reporting is the disruption of the pandemic.

There is still a lot of work to do in companies internally and on a societal and political level. Still, we are making progress, and we are certainly going in the right direction to create an inclusive environment where women, men and businesses thrive together. The sunny sky outside my window gives me great hope for this year, so let’s stay positive for 2022! Let’s focus on what we need to do now to close the gender pay gap.

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Related Reading 

• Women will fight our way back from COVID’s pay assault 
• Turn this setback to gender equality into opportunity. 
• Shine with Elite Business: We need to empower men to help us solve the gender gap 

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