If you’re part of an organisation across the UK and Ireland which comprises 250 or more employees, then for several years, your business will have been obligated to produce a gender pay gap report which outlines potential disparities in pay between male and female employees.
Pay is often considered to be the cornerstone of any organisation’s rewards structure and in recent years there has been increased scrutiny of pay disparity, as well as a desire among today’s workforce for their employers to act as more empathetic and socially minded entities- research by the Harvard Business Review found that 88% of employees place an importance in working alongside a diverse team, especially as skill sets, roles and company requirements evolve over time.
While there is a legal obligation for organisations to produce an annual report of their gender pay gap, many businesses such as Advanced, have taken the opportunity to broaden their reporting to cover wider diversity pay gaps. The question is why?
Robust reporting of diversity pay gaps can offer businesses the insight they need to action meaningful change across their pay and rewards structures, as well as helping position them as more mindful and empathetic employers. Unfortunately, pay gap reporting does also represent a significant admin hurdle for payroll and people teams to overcome, with the threat of non-compliance carrying with it the potential for various legal and financial penalties.
In this article, we wanted to explore the importance of HR systems and technologies in helping organisations bridge the gap between pay disparities and how bringing your people teams into the fold can help you not only achieve accuracy in reporting but empower you to create an action plan for sustained drops in your pay gaps year on year.
What are diversity pay gaps?
Pay gaps are indicators of systemic and often well embedded biases related to diversity and inclusion. More specifically, they are the measure of the percentage in average hourly pay difference between specific groups within an organisation. Gaps can exist between genders, sexualities, individuals with disabilities or different ethnicities and are generally considered to be indicative of outdated societal attitudes and biases.
Since 2015, there have been legal requirements in place for organisations to disclose information around their gender pay gaps, often in the form of annual reporting. Many organisations, such as The PWC use this reporting period to disclose more information than legally obligated- publishing information on ethnic, disability and sexual orientation related pay gaps.
Failure to identify gaps in pay and demonstrate an ongoing commitment to closing gaps carries a much greater risk than those just posed by noncompliance with reporting. Diversity pay gaps highlight existing biases and inequalities within your organisation which existing employees and prospective new hires may judge you by.
How can Advanced HR help?
As with any pre-eminent legislature, the burden of compliance with diversity pay gap reporting will likely fall at the feet of an organisation’s people teams. Many organisations may consider these obligations to be just that- admin burdens which place demands on the valuable time of their people teams. But what if you were to consider the transformative potential of the information comprehensive diversity pay gap reporting can offer you?
Your HR teams and the systems they rely upon daily are ideally placed to provide you with the key insights you need to drive meaningful change. The key to achieving success with your diversity pay gap reporting and securing the drops your business needs will largely lie in having access to comprehensive and actionable data.
We’ve created Advanced HR in order to free people teams from the burden of manual inputs and admin heavy tasks and instead empower them to leverage their talents in more meaningful ways. We’ve also put reporting at the heart of the solution, allowing your organisation access to a comprehensive overview of your structure and the key data metrics you need to drive change.
So what exactly can Advanced HR help you achieve?
- In-depth reporting- Gain an unparalleled overview of your organisation, understand where gaps in pay or other procedures exist and begin crafting policy and procedure to truly help your people. When looking at your diversity pay gap reporting, the information you will gain is only as effective as the questions you ask. Advanced HR gives you access to the intuitive reporting you need to guide your people management strategy today.
- Offer practical advice- Insights gained through reporting allow your people teams to have a more authoritative voice in ongoing strategy planning, empowering them to use their expertise to guide policy and make changes where needed.
- Built-in diversity workflow- Break out of a rigid annual cycle of diversity reporting and gain an overview of employee sentiment as and when you need it. Our built-in diversity workflow allows you to push out tailored questions to your people and get feedback when you need it, not as schedules dictate.
- Customisable data fields- It stands to reason that the requirements for one year’s set of reporting may differ wildly from the next. Rigidity in your processes- being constrained to a specific set of questions, means you run the risk of losing out on the insight you need. Advanced HR offers you the ability to customise question fields and tailor your reporting experience in order to get to the heart of matters and gain the specific insight you need.
- Drive discussions and communicate intent- Empower your HR teams to drive forward meaningful conversations around diversity and your ongoing commitment to driving down pay gaps. Advanced HR offers a self-service platform that acts as the perfect host for company-wide communications, meaning that regardless of where they choose to work, your people are aware of what these reports mean for them and what your ongoing goals around diversity pay gaps are.
- Simplify your processes- One of the biggest hurdles presented by diversity pay gap obligations is the time sink it represents for people teams. All too often, organisations find themselves burdened by outdated systems which can actively compound challenges and mean that people teams find themselves spending too much time week on week putting out fires and correcting faults that can occur through human error. Advanced HR offers you a far greater degree of automation in your people management processes, meaning that the talents of your people teams can be leveraged in more meaningful ways.
What’s next?
The overarching goal for any pay gap reporting is obviously going to be to reduce incidences of pay disparity, regardless of where they occur. Organisations will find that sustained success in their reporting will truly be achieved through speed and efficiency of reporting- removing the roadblocks preventing you from gaining meaningful insight.
This is one of the reasons that we believe it is good practice to broaden your scope from gender pay to wider diversity reporting. Taking that next step allows you to move away from a perception of pay gap reporting as an admin headache and a legal obligation and instead to consider the transformative possibilities such initiatives can present for your organisation.
Effective diversity pay gap reporting not only offers you the metrics you need to drive sustained positive change, it’s also the perfect way to position your organisation as a more empathetic employer who is mindful of the need to reflect the changing requirements of their people.
We designed Advanced HR with the philosophy of “Doing HR differently” in mind. We believe that the systems and technology which your people teams rely upon daily, should offer you access to the data points and insights you need to drive meaningful change. We also believe that HR professionals have a far more significant role to play than simply acting as admin robots and that only by freeing them from the burden of manual inputs and checks, can you truly leverage their talents in more influential ways..
If you’d like to discover more about how Advanced HR can help you achieve more effective pay gap reporting, get in touch today.