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What's included in an Equal Pay Audit?

Jane Baalam

Mar 20, 2023

I'll be honest, it will involve a bit of work at your end

No one sets out deliberately to have unequal pay practices. However, it is easy for history, bias and lack of clarity to have exactly that result. Many organisations shy away from undertaking an in-depth equal pay audit for fear of what they might find. However, if you don’t know what the actual problem is how can you resolve it?


It is important to just to be clear that where equal pay legislation is concerned, you are assessing whether there is a notable gap in pay for equal work, which can be defined in three ways and we recommend you assess your data using this as a guide:

 

  • Work ‘rated as equivalent’ – where the comparator groups have had their jobs rated as equivalent under an analytical job evaluation scheme, with similar evaluation scores and categorised in the same level.
  • Work of ‘equal value’ – where the work is different but is of equal value in terms of the demands of the job. Where job evaluation is not common practice, placement in a ranked structure can be useful and is usually related to organisation structure or pay framework.
  • ‘Like work’ – where the comparator groups (in this case, men and women) are doing work that is the same or broadly similar.


When undertaking an EPA your consultant will work with you to identify which roles are in scope and establish what information is needed to support the review. 


Key steps that will require your input should include:

·       Identifying which staff are included in the audit

·       Understanding how the business is structured and what organisation codes are used

·       Identifying pay elements to be included and ensuring that all payroll elements are aligned by title

·       Identifying non-pay elements to be reviewed

·       Collecting and collating pay related policies

·       Establishing the parameters for the reports

·       Assessing and comparing the salary data using EHRC guidelines and the characteristics you have agreed (gender, ethnicity, age, length of service, alignment to structure)

·       Creating a report summarising with the findings, and

·       if you work with us on this, we will also recommend involving Menzies law in assessing the legal risks in the findings

·       Developing a plan for mitigation.


What are the outcomes?

·       You get a report showing exactly where and how unequal pay practices were occurring.

·       You get a summary of the biggest gaps and where to focus your efforts

·       You will have a summary or a risk assessment, of the legislative requirements outlining your responsibility and the potential risks to the organisation of failure to comply (useful when talking to a sceptical leadership team)


Most importantly, you have the starting point for taking some positive action to understand and resolve some of the issues. 


Don’t be daunted by this, a good consultant will help you along the way. Just pick up the phone.

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