Pay attention to equal pay

Is your business delivering equal pay for equal work? Martin Crick, legal and technical information manager at Associa Employment Service explains how not to get caught out

Is your business delivering equal pay for equal work? Martin Crick, legal and technical information manager at Associa Employment Service explains how not to get caught out

If your business is going to recruit and retain the best people, you will need to demonstrate you have banished sex discrimination from the workplace. While many businesses have made progress in eliminating sex discrimination, others, it seems, still have some way to go.

Recent research from the Equal Opportunities Commission (EOC) suggests sex discrimination is still evident in employee pay packets across the country. According to the EOC, the difference in average pay between men and women working full time is £559 per month. Whilst this may have a number of causes, not all of which employers can resolve alone, it is likely many women are still being paid unfairly.

One way the EOC would like to see businesses tackle the problem is to conduct equal pay audits. Equal pay audits are reviews undertaken by an employer to check whether male and female employees doing equal work get paid the same, however you need to be cautious if you are thinking about conducting a pay review. Bungled attempts at checking pay could land you with a new set of legal problems, whether or not you have been discriminating against employees because of their sex.

Some organisations may argue lifting secrecy on pay would help tackle discrimination – and this may be the case – but there is a strong danger of wrongly divulging personal details about employees. Remember personal data, which will normally include pay records, is protected by the Data Protection Act 1998.

The first steps should be to decide the scope of their review and to identify the information required. Normally the review will include all employees of the business to help avoid accusations of unfair treatment. The information required will not only consist of pay and benefits details, but should include relevant personal information about each employee – such as their gender, hours worked, role and qualifications.

You should then determine where men and women are doing equal work. Remember, equal work means like work (i.e. work that is the same or broadly similar), work rated as equivalent (as evaluated under an objective and fair job evaluation scheme), or work of equal value (taking account of requirements such as skills, qualifications, responsibility, effort).

Use the information gathered to make a comparison between employees. Employers should compare the pay data and identify any gaps between men and women doing equal work that require further investigation. Look beyond the comparisons and establish the cause, it may be that there is a genuine and material reason for the difference in pay that has nothing to do with gender.

Employers should also examine which pay policies are contributing to the pay gaps and question whether these policies are objectively justified. It is little use conducting an equal pay audit if the employer does not act upon the findings. Even if there are no significant pay gaps, or any gaps are for genuine non-discriminatory and objective reasons, continue to monitor your pay system regularly to avoid future problems.