Despite the fast-approaching UK deadline to submit gender pay gap reports, which is less than a month away, just 24% of companies required to comply with current legislation have done so to date, according to a new study.
The Equality and Human Rights Commission will begin enforcement action against late reporting UK-based companies with 250 or more employees, on 5 April 2022, confirmed pay gap specialist Spktral. Its CEO Anthony Horrigan believes “that the majority of organisations want to make progress”, but notes that “their intentions don’t always match their actions”.
The question stakeholders should be asking is: “are the remaining organisations leaving it till the eleventh hour to complete this critical work,” ponders Horrigan? “Or did they complete it months ago, but they neither shared nor acted on their findings because they see it as mere compliance?”
Either way it’s not the right approach. “It’s crucial that companies carry out their Gender Pay Gap analysis as soon as possible if they want to use the insights to adjust their processes and drive greater representation of women across their workforces before the next snapshot date,” advised Horrigan.
ACTION PLANS TO ADDRESS PAY GAPS
Rather than focusing on pay and bonus gaps, companies can use the gender pay gap analysis to reveal the “representational shape” of an organisation. While there is a lot of discussion around changing percentages and reducing any ‘pay gaps’, UK firms would benefit from realising that an aggregated percentage is just a symptom. A more detailed set of symptoms are all the gaps in the representation of women throughout the pay range of their organisation and that to find the cures, they need to discover the root causes of these gaps.
Once organisations have identified where the gaps in representation are and what causes them, they can begin to formulate action plans to address them. By detailing their unique challenges and the actions they are going to take to address them, organisations show an awareness of what they are doing correctly, and perhaps what they could improve on. It also highlights their commitment to improving equity and diversity within their organisation.
COMPLIANCE ERRORS
Additionally, over 20% of the 2021 submissions contain compliance/calculation errors, according to Horrigan. He believes many senior leadership teams are unaware of these mistakes because they have made assertions that the employees, business partners or external service providers tasked with this process have completed it correctly. “Until this process contains a robust audit – simple compliance errors will continue to occur frequently,” he stated. “Crucially, organisations cannot create positive change if their starting point is inaccurate data, as this will more than likely create false flags.”
To avoid this, senior leaders and non-exec directors should ask that the process is checked – not just for the current year, but historically to account for the three years’ worth of published reports that every organisation is required to have on their websites. “If the people carrying out this work are not appropriately qualified or if it is taking up valuable resources then they should outsource to a trusted partner to work with representatives from your organisation; this is about your talent, their progress and the future shape of your organisation,” concluded Horrigan. “Companies preparing the reports should bear in mind that it is not the end of a process, it’s the start; and the sooner this process begins, the sooner effective change can be implemented.”
A new report has revealed that some progress has been made towards closing the gender pay gap in the retail sector, despite the turbulence caused by the pandemic, unlike the hospitality, travel and leisure industries, as reported. Click here to read more.
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