UK gender pay gap evaluation: template and examples
Learn how to calculate a gender pay gap – and why it’s important
The gender pay gap mainly measures the difference between men and women’s average hourly rates of pay. It also includes other factors, like how men are overrepresented in higher paying roles and the time women spend in unpaid care roles alongside paid work.
In recent years, initiatives have been implemented to close the gender pay gap by promoting female staff, providing better parental leave, childcare vouchers and more. However, there’s still work to do, as the majority of UK businesses still have a gender pay gap.
But why is it important to close the gap? By retaining top female talent, you can help your business to grow. We’ll help you to build a report, and provide the resources and tools you’ll need to do so. Let’s get started.
What is the gender pay gap?
The gender pay gap is the difference between the median hourly rate that men and women receive. This doesn’t include men and women doing the same work or profession – it just means the pay men and women receive overall in your company. Measuring the gap helps to provide insight into whether men or women are over or underrepresented in high-paying roles.
Why is it important to report on the gender pay gap?
With the introduction of new UK regulations in 2017, businesses are now expected to report on their gender pay gap annually. Any business with more than 250 employees should report their gap.
Businesses can report by using what’s known as a ‘snapshot date’. This date is usually specific to the industry you’re in. For example, for public authorities, the snapshot is the 31st of March. For everyone else, that date is the 5th of April. You are usually given a year to report your snapshot.
Fair pay can foster employee engagement and commitment to your business. Reporting on your gender pay gap helps you to identify areas of improvement as well as create transparency and generate trust.
Who is responsible for building a gender pay gap report?
Businesses are responsible for building their own gender pay gap reports. As an HR professional, you’ll be at the forefront of using company people data to uncover differences in pay between male and female employees. You can refer to gender pay gap Equality Act 2010 regulations for a framework for your report.
It’s of value to have someone on your team with statistical or analytical skills. You might also be using a payroll system that creates pay gap figures – it is worth checking if your software does this. You may also reach out to communication experts who can help you build a narrative around the pay gap report you create.
Building a report
To create a gender pay gap report, you’ll need to follow specific steps. We’ll explain how.
Gathering payroll data: what you need
Firstly, you’ll need to gather your payroll data and prepare it for use. Remember, focus on taking data from a pay period known as a ‘snapshot date’. Then, make a list of all your employees and their gender. This includes two groups:
- Relevant employees: these employees have an employment contract whether it’s part-time, job-sharing or on leave. Or they are self-employed contractors working for you. This group will help you calculate a gender pay gap in bonus pay.
- Full-pay relevant employees: these employees are paid full basic pay, including if they have been working irregular hours on an exceptional basis. This group will help you for all other gender pay gap calculations.
Split them into two lists and keep them separate, as payroll data is different for these two groups.
You’ll also need the gender of each employee. Consider using information already provided by employees to HR, as being sensitive about asking an employee’s gender is important. If the information is not available, invite employees to update their records. If an employee doesn’t identify as male or female, you can leave them out of the gender pay gap dataset.
Quick tip: Using other employee characteristics, you can identify other kinds of pay gaps such as by age or ethnicity.
Next, gather the relevant pay information on each employee. This includes:
- Your full-time relevant employee ordinary pay, which is based on their gross pay,
- Bonuses received by both relevant and full-pay relevant employees, preceding 12 months ending on the snapshot date you’re using. You can use this to calculate your bonus pay gap, as well as a mean and median pay gap,
- All bonuses full-pay relevant employees received during the pay snapshot. This will help you to calculate bonus pay gaps as well as mean and median gaps.
You’ll also need their hours:
- Weekly working hours for full-pay relevant employees: This helps you to calculate mean median gender pay gaps,
- Hourly pay for relevant employees: This is to calculate both mean and median pay gaps as well.
What is a dataset and why do you need one?
Then, create a structured dataset from the payroll data. The dataset should be in a structured format so that you can use it for analysis like statistical analysis, or data visualisation. These types of presentation can be extremely helpful for your report.
Creating a narrative
While you don’t have to create a narrative or communication plan, it can help to demonstrate transparency about any gender pay gaps you might have. This gives you space to communicate the context around your gap that could be due to women working in lower paid roles in your business.
Creating a communication plan
You can share a gender pay gap narrative via your website, or through social media. Creating a communication plan helps you to tell the story around your gender pay gap, plus explain how you’re going to address it. Here are some tips for creating your comms plan:
- Outline the aims of your plan,
- Think about including key takeaways from the analysis,
- Understand who your key audience is. Consider how the public and media might receive your narrative,
Know which channels you’ll use to communicate the narrative,
- Identify who will receive the message first. Most of the time, employees should be made the priority.
- Highlight who will be the spokesperson to communicate your narrative,
- Identify any risks in your findings, which you may or may not choose to make public.
Creating a narrative can be a great step in addressing your gap, but an action plan is even better.
Communicating how you plan to take action
Creating and communicating your action plan shows that you understand how to follow up on your findings. Consider discussing the pay gap with your employees. If women are pay disadvantaged, then work out how to best support them.
Evaluation and example templates for calculating the gap
Here, we’ll provide an example template for calculating both mean and median gender pay gaps. To calculate the mean or average pay gap:
- Add together all hourly pay for male full-pay staff, then divide this number by the number of male employees in total. Then do this for all your female staff.
- Take the mean hourly pay and subtract the mean hourly pay for women from this figure.
- Divide this new figure by the mean hourly pay for men, then multiply the result by 100.
- Report this figure.
To calculate the median pay gap:
- List male employees in order of hourly pay, from the lowest to the highest.
- Find out which male employee is in the middle of the list. This provides you with the median hourly pay for men.
- Do the same for your female employees.
- Minus the median pay for women from the median pay for men.
- Divide this new result by the median pay for men, then multiply this by 100. You’ll then have the median hourly pay gap you must report.
Gender pay gap survey checklist
In this section, we cover a checklist of data to collect from employees to help you put together your gender pay gap analysis. The data will also help you provide a greater narrative context to your results.
- How long has the employee been in the company?
- What is the employee’s gender?
- What is the employee’s ethnicity?
- What was the employee’s starting salary?
- What is the employee’s payroll data?
- How many hours have they worked?
- What are the employee’s professional goals and objectives?
- What training have they had?
- Have they had any competency assessments?
- What are their professional accomplishments?
- What are their role responsibilities?
- How essential is their role to the business?
Conduct deeper DE&I research with SurveyMonkey
Deeper research can help you find out whether women in your workplace are thriving. It identifies room for improvement on a more granular level. Use our gender in the workplace survey to find out:
- How your organisation is performing on gender diversity,
- Whether employees feel your organisation is a meritocracy,
- Whether employees feel assisted in their career development,
- Whether they share responsibilities for childcare duties at home.
While the gender pay gap helps you to identify women’s pay disadvantages, transgender employees can face them too. With our gender inclusivity survey template, discover whether your transgender employees are feeling safe and included at work.
You can also find out whether your workplace is diverse and inclusive with our culture pulse survey.
Why not expand to look at diversity in your workplace in general? Our employee diversity survey template can help you:
- Learn how to build better representation in the workplace,
- Understand whether employees have requirements that you could accommodate,
- Identify whether there are opportunities to create internal communities.
Pay gaps aren’t just limited to gender pay gaps. There are many kinds such as race or age pay gaps. Find out whether your business has them with our pay gap survey template.
Conclusion
Gender pay gap UK reporting regulations explain that as a business, you need to annually report on your gap. Building a report, creating a strong narrative around it and an action plan can help provide transparency as well as better outcomes for pay equality. With the help of SurveyMonkey’s DE&I survey templates, learn how your employees feel when it comes to inclusivity and pay. Evaluate your DE&I targets today with our survey templates