Equal Pay Review All Employees

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1 All Employees Rewards/HR May 2014

2 Contents 1. Introduction 2. Context 3. What is an Equal Pay Audit? 4. The University s Approach 5. Data Collection 6. Methods for Estimating the Pay Gap 7. Overall Gender Pay Gaps 8. Detailed Analysis of Gender Pay Gaps 9. Analysis by Other Protected Characteristics 10. External Comparisons 11. Conclusions 12. Recommendations UoY Equal Pay Review April 2014 v3.docx Page 2

3 1. Introduction The University supports the principle of equal pay for work of equal value and recognises that we should operate a pay system that is free from bias and is based on objective criteria. The University carried out an institution-wide pay and grading exercise that was implemented in 2006 whereby most employees moved to a new grade structure underpinned by job evaluation using the HERA methodology. The University carries out regular monitoring, working collaboratively with trade union colleagues, to assess the impact of pay policies and practices against a number of equality indicators, including protected characteristics where data is sufficiently robust. The next Equal Pay Review covering all staff will be conducted in Context The Public Sector Equality Duty came into force in April 2011 and was created by the Equality Act Further guidance from JNCHES recommends that employers publish equality information such as the gender pay gap and an equal pay statement. 3. What is an Equal Pay Audit? a) An Equal Pay Audit involves: The comparison of pay of men and women doing equal work The identification of any equal pay gaps The explanation and justification of gaps using objective criteria The addressing of any gaps that cannot be satisfactorily explained on the grounds of work content Ongoing monitoring b) Benefits of conducting an Equal Pay Audit: Identifying, explaining and, where justifiable, eliminating pay inequalities Supporting rational, fair and transparent pay arrangements Demonstrating to employees a commitment to equality Demonstrating the University s values to those it does business with Helping to meet the public sector equality duty UoY Equal Pay Review April 2014 v3.docx Page 3

4 c) Our methodology for carrying out an Equal Pay Audit is as recommended in the UCEA/JNCHES and the Equality Challenge Unit s (ECU) guidance as follows: Step 1 Step 2 Step 3 Step 4 Step 5 Decide the scope of the audit and identify the information required Determine where men and women are doing equal work Collect and compare pay data to identify any significant pay inequalities between roles of equal value Establish the causes of any significant pay inequalities and assess the reason for them Develop an equal pay action plan to remedy any direct or indirect pay discrimination 4. The University s Approach This is the third Equal Pay Audit undertaken by the University. All UoY employees on open or fixed-term contracts are included with the exception of employees on trainee grades such as Apprentices, Interns and KTP Associates. Hourly paid workers are excluded. The Equality Act 2010 and resultant Public Sector Equality Duty covers the following equality strands which are termed Protected characteristics : age; disability; gender reassignment; pregnancy and maternity; race; religion or belief; sex and sexual orientation and marriage/civil partnership. Of these, our Equal Pay Review covers age, disability, race and sex. As we do not currently collect employee data on the other protected characteristics, we are not able to provide equal pay analyses. In addition, we provide data on starting salaries, full vs. part-time, and can provide analyses on fixed vs. open contracts. 5. Data Collection The data was taken from the HR System as at 1 September Previous audits were from 2008 and Equal pay analyses should be on both base pay and total remuneration. However, it is very difficult to determine the nature of all additional payments and whether these are job-related or not. In addition, some are made directly by Payroll and not sufficiently detailed on the HR system (overtime, unsocial working enhancements, fees, consultancy, etc.) A decision has therefore been taken to use base pay only for this audit. Data was analysed for all employees to calculate pay gaps. Thereafter, employee data has been grouped as considered to be appropriate. The group of employees analysed is stated in UoY Equal Pay Review April 2014 v3.docx Page 4

5 the findings. Employee counts stated in the tables of this report are headcount figures. 6. Methods for Estimating the Pay Gap The gender pay gap is calculated using the average (mean) and median salaries of females expressed as a percentage of the average (mean) and median salaries of males doing work of equal value. It should be noted that salary is taken to mean basic annual full-time equivalent excluding any additional salary payments. This figure is shown as a negative percentage (-%) if females are paid more than males. The gender pay gap has been calculated for different gender groupings. Similarly, pay gaps have been calculated for a number of the protected characteristics and reported on where possible. For calculating pay gaps based on ethnicity, BME employees salaries are expressed as a percentage of white employees salaries and salaries of disabled employees as a percentage of non-disabled employees. Data is not provided in respect of sexual orientation, religion or belief or marital status as we do not hold this data on our HR System. To avoid debate and enable comparisons to be made, the pay gaps have been calculated and reported on using both the mean and median salaries. Pay gaps of 5% or greater will be considered to be significant and worthy of further investigation. The gender pay gaps have been reported for different groupings of University employees. These are: Framework Grades 1-8 Framework Grades 1-8 split by Support Staff (Grades 1-8) and ART Staff (Grades 5-8) Non-Framework Grades (Professoriate, HoDs & Senior Management Pay Group) 7. Overall Gender Pay Gaps Table 7.1: All employees Gender Pay Gap All Grades Mean Pay Median Pay Year Female % Male % Headcount Headcount Gap Gap % % 22.7% N/A % % 21.7% N/A % % 20.6% 18.6% Overall the mean pay gap has reduced but remains significant. This illustrates the fact that there are more higher paid males than females and more lower paid females than males. UoY Equal Pay Review April 2014 v3.docx Page 5

6 7.2 Overall Gender Profile and Pay Gaps by Staff Category Table 7.2 The overall gender pay gap within the University s staff categories is shown at Appendix 1a), and is summarised below: All Staff Male All Female All Staff Group Count Average Base Pay Count Average Base Pay Median Base Pay Count Average Base Pay Average Pay Gap (%) Median Base Pay Median Pay Gap (%) ART 1,208 40, ,327 44, , , Support 2,013 27, ,200 25,504 1,212 26, , HOD 27 92, ,879 92, , , Professoriate , ,338 73, , , Senior Mgmt 40 87, ,142 79, , , TOTAL 3,557 36,392 1,658 40,880 36,298 1,899 32, , The significant distinction between the average and median pay gap reflects the differences between measuring the gap in the arithmetic average salary for all males and all females in each staff category (mean pay gap), and the difference in salary of the employee at the 50 th percentile ranking level in the gender group in each staff category. Where the two figures are different, there is evidence of significant outliers adversely affecting the average pay gap. The general picture shows an average pay gap of 20.6% between male and female employees i.e. the average pay for males ( 40,880) is 20.6% more than the average pay for females ( 32,474). This significant pay gap exists in all staff categories apart from within the HoD pay group. As previously reported, these gaps are a manifestation of the asymmetry in the male:female employee profiles across grades i.e. there is a higher proportion of female employees in lower grade jobs and a much higher proportion of men in higher level jobs within each staff category/pay group. There is no evidence of pay gaps within the Framework grades where work of equal value is determined by the HERA job evaluation methodology (see detailed grade analysis in section 8). UoY Equal Pay Review April 2014 v3.docx Page 6

7 The grade profile difference is shown graphically in the chart below: Table 7.3 Gender % of employees by Grade Male % of Grade Female % of Grade The chart above shows higher concentrations of females in Grades 1 to 7 (1,672 females vs. 1,171 males) and higher concentrations of males compared with females in grades 8 and above. It is this relative skew of the male and female populations across grades that gives rise to the pay gap between males and females. Table 7.4 Professorial Split by Gender comparison with Russell Group We recognise that there is a higher proportion of males in the senior pay groups, particularly within the Professoriate, but this is a sector issue. Although we would probably wish to have more Female Professors than at present, our gender split is currently slightly better than the other Russell Group universities combined. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Gender Split - Professoriate 79% 78% 21% 22% Russell Group Average York Male Female UoY Equal Pay Review April 2014 v3.docx Page 7

8 Table 7.5 Pay Gaps to all employees average base pay ( 36,392) The following table shows headline pay gaps for the following characteristics: University of York Headline Gender Pay Gaps Full-time only Part Time only Ethnicity (BME vs White) Disability (Disability vs No Disability) Female employees only +9.1% +24.7% +11.9% - All Employees -9.6% +21.3% +0.4% +9.8% UoY Equal Pay Review April 2014 v3.docx Page 8

9 8. Detailed Analysis of Gender Pay Gaps 8.1 In order to assess more fully the gender pay gaps presented in section 7, it is necessary to analyse by grade. Table 8.1: Gender Pay Gap by Grade Grade Gender Headcount Mean FTE Median FTE Mean Pay Median Pay Salary Salary Gap Gap 1 Male ,677 14, % 0.00% Female ,809 14,905 2 Male 47 16,619 16, % -4.35% Female 60 16,875 17,259 3 Male ,114 20, % 5.53% Female ,896 19,056 4 Male 89 21,446 21, % 0.00% Female ,454 21,383 5 Male ,530 27, % 0.00% Female ,336 27,047 6 Male ,305 33, % 0.00% Female ,213 33,230 7 Male ,427 44, % 0.00% Female ,217 44,607 8 Male ,588 53, % 0.00% Female ,686 53,233 Framework (Grades 1-8) Male 1,409 35,051 35, % 10.86% Female 1,812 30,519 31,244 Professoriate Male ,338 73, % 6.27% Female 63 68,818 68,742 HoDs Male 16 92,879 92, % 3.19% Female 11 90,354 89,920 SMPG Male 27 91,142 79, % 7.29% Female 13 79,902 73,798 When considering the pay gaps by grade in Table 8.1, a number of observations can be made: Firstly, the headcount by grade shows that for grades 1-7, females are generally greater in numbers than males Males form an increasing majority of the headcount for grades 8 and above There are no significant average salary gender pay gaps by grade until the Professoriate and the Senior Management Pay Group (SMPG) It is apparent that both the disproportionate gender balance in the higher grades and the pay gaps for the Professoriate and the SMPG have a major impact on the University s overall pay gap. UoY Equal Pay Review April 2014 v3.docx Page 9

10 8.2 Pay Gaps for newly recruited staff The following analyses show numbers of staff recruited at the lowest salary point within a grade (Table 8.2a) together with the average starting salary paid for men and women for each grade (Table 8.2b). For this analysis, we have taken all new recruits to the University between 1 September 2012 and 31 August 2013, ie, with less than 1 year s service at 1 September Table 8.2a Staff with less than one year s service at 1 September 2013 at lowest salary point in grade (grade minimum) Current Grade and salary point Number of staff with less than 1 year s service (at 1 Sept 2013) at lowest salary point within grade % of new hires recruited to lowest salary point or grade minimum % % % % % % % % PROF1 SP1 0 0% This would appear to indicate that the higher the grade, the less likely it is that new recruits will start at the minimum of the pay scale. This could be because we hire people with more experience at the higher grades or that our pay scales, which only move with the annual National Pay Award, have not kept pace with market salaries. Table 8.2b Gender pay gap on average starting salaries for employees hired between 1 September 2012 and 31 August 2013 Grade Males Females All Mean Pay Total Male Avg Total Female All All Avg Gap Males Start Females Avg Start Start Female Salary Salary Salary vs Male , , , % , , , % , , , % , , , % , , , % , , , % UoY Equal Pay Review April 2014 v3.docx Page 10

11 Grade Males Females All Mean Pay Total Male Avg Total Female All All Avg Gap Males Start Females Avg Start Start Female Salary Salary Salary vs Male , , , % , , , % HOD2 1 80, , % HOD3 1 95, ,000 PROF1 5 64, , , % PROF , , , % PROF3 6 80, ,306 SNRMGT 2 55, ,000 There are no significant pay gaps in starting salaries within any grade. 8.3 Full-Time to Part-Time Pay Gaps The pay gaps according to whether employees were full-time or part-time were also calculated by grade. A negative pay gap denotes that part-time employees mean or median pay is higher than full-time employees. See Table 8.3b for more detail. Table 8.3a: Full-time to Part-time population Part-time working accounts for 31% of all employees at the University. It is significantly more popular amongst females (44% of all female employees) than males (22% of all male employees). UoY Equal Pay Review April 2014 v3.docx Page 11

12 Table 8.3b: Full-time to Part-time pay gap Pay Gap Full-Time to Part-Time All Employees Grade Mean Pay Gap Median Pay Gap % 0% % 0% % 2.81% % 0% % 0% % -9.23% % 0% % 0% Professoriate -5.1% -0.78% HODs No Part-time HoDS SMPG 29.65% 21.45% Total 28.15% 37.46% Grade for grade (ie for equal work groups), there are no significant pay gaps for full-time vs. part-time employees, with the exception of: - grade 6 where there is a pay gap in favour of part-time employees and - the Senior Management Pay Group (which covers 4 separate pay bands) where there is a pay gap in favour of full-time employees. However, when you roll up the data for the total population, there are significant mean and median pay gaps, largely due to the small numbers of part-time employees in the higher grades (Table 8.3a). UoY Equal Pay Review April 2014 v3.docx Page 12

13 9. Analysis of Pay Gaps by other Protected Characteristics Table 9.1a Age Band Populations Age Group All Ages Total , ,557 % of Total 2% 23% 29% 27% 16% 3% 100% Table 9.1b Age Band Average Pay Gaps to All Ages Group The figures below show the pay gap for the relevant age group, ie vs. the roll up for All Ages. A +% figure shows that the average salary for that age group is less than the all age group average salary. A % figure shows that the average salary for that age group is more than for the all age group average salary. Age Group ART +28% +17% -2% -11% -15% -12% Support +28% +7% -8% -5% +3% +28% HoD % -5% -6% Professoriate - +13% +13% +2% -7% -5% Snr Mgt - +38% +35% +11% -4% -84% Total +44% +20% +2% -9% -14% -40% The pay profile by age band shows significant pay gaps for employees in the younger two age groups, up to age 34, and more favourable pay gaps for employees in the latter age groups, aged over 55. This is in line with the common lifecycle of employment patterns at the University. Employees in the younger age groups are usually in the earlier years of their career. Additionally, in the first few years of their employment they tend to be on the lower incremental points of the grade, thereby tending to reduce their average pay compared with older employees in similar roles or undertaking work of equal value. These trends are reversed in older age groups, where career experience tends to favour advancement into higher grades with higher pay levels. UoY Equal Pay Review April 2014 v3.docx Page 13

14 9.2 Ethnicity 94% of employees have provided an indication of their ethnic type 6% of employees have a not known ethnic origin. 8% of University employees are Black and Minority Ethnic (BME), compared to an estimated BME population in the York area of 5.8% (2011 ONS Census York.) Table 9.2a Ethnicity Profile and Pay Gap Ethnicity White BME Refused/ Not Known Total Pay Gap (BME vs. White) Total 3, ,557-1% % of Total 86% 8% 6% Table 9.2b Ethnicity Profile by Gender and Pay Gaps Ethnicity White BME Refused/ Not Known Total Pay Gap (BME vs. White) Male 1, ,658 +1% Female 1, ,899 0% All 3, ,557-1% The above analysis shows that there is no significant pay gap in the overall average pay for White and BME employees. The detailed analysis of grade level basic pay shows, in general, there are no significant pay gaps within grades i.e. for work of equal value. Therefore, there does not appear to be any evidence of systematic unfair pay gaps in the ethnicity dimension amongst employees at the University. UoY Equal Pay Review April 2014 v3.docx Page 14

15 9.3 Disability Only 3% of employees at the University have declared a disability with 79% declaring no disability and 18% have a not known disabled status. Table 9.3 Disability All employees % of Total population Disability Profile by Staff Category and Pay Gaps Not disabled Disabled Not Known Total Pay Gap (Disabled vs. Not Disabled) 2, , % 79% 3% 18% The analysis above shows that there is a significant basic pay gap between disabled to not disabled employees. However, the pay gaps are not related to grades and do not indicate pay gaps against work of equal value between disabled and not disabled employees. 9.4 Other protected characteristics The University does not collect or record data on other protected characteristics such as sexual orientation, religion or belief or marital status. We are therefore not able to include these characteristics in our equal pay review. UoY Equal Pay Review April 2014 v3.docx Page 15

16 10.Comparison with earlier Equal Pay Reviews Equal Pay reviews have been conducted in 2008, 2010 and A summary of the average salaries is shown below together with the pay gap (on average salary) for each of the staff categories for each year. Table Staff Category Total Empees All Males Females Total Avg Salary Nbr of Employee s Avg Salary Nbr of Employe es Avg Salary Average Salary Pay Gap % ART Total 1,122 35, , , % Support Total 1,746 22, ,135 1,096 21, % Prof Total , , , % Snr Mgt Total 24 67, , , % VCG Total , , , % All Staff 3,135 31,143 1,474 35,403 1,661 27, % Table Staff Category Total Empees All Males Females Total Avg Salary Nbr of Employee s Avg Salary Nbr of Employe es Avg Salary Average Salary Pay Gap % ART Total 1,125 39, , , % Support Total 1,882 25, ,241 1,177 24, % Prof Total , , , % HOD 28 81, , , % Snr Mgmt + VCG 38 86, , , % All Staff 3,291 34,665 1,529 39,228 1,762 30, % UoY Equal Pay Review April 2014 v3.docx Page 16

17 Table Staff Category Total Empees All Males Females Total Avg Salary Nbr of Employee s Avg Salary Nbr of Employe es Avg Salary Average Salary Pay Gap % ART Total 1,208 40, , , % Support Total 2,013 27, ,200 1,212 26, % HOD 27 92, , , % Professoriate , , , % Senior Mgmt 40 87, , , % All Staff 3,557 36,392 1,658 40,880 1,899 32, % Since 2008, the pay gap on average salary has reduced from 22.7% to 20.6%. In the same period, the UK pay gap as measured by ONS, has reduced from 22.5% to 19.7% (see chart below). Table 10.4 UoY vs. overall UK Gender Pay Gap In the same period, male average earnings at the University have increased from 35,403 to 40,880 (15.5%) and female average earnings from 27,362 to 32,474 (18.7%) Since 2008, the female population (as a % of the total population) has remained static at 53%. UoY Equal Pay Review April 2014 v3.docx Page 17

18 10.5 Other external comparisons Table 10.5 Gender Pay Gaps: other UK comparisons Female median base pay vs. Male median base pay Gender Pay Gap All Employees UK Workforce April 2012 (Source ONS) Higher Education (ECU 2012) UoY Total +19.7% +16.3% +18.6% Staff Category Split Framework Grades 1-8 Non- Framework Grades UoY 1994 Group (2012) +11% N/A +8% N/A Full-time Employees +9.6% N/A +11.2% Framework Grades 1-8 Non- Framework Grades +8.5% +11% +0.7% +6% Part-time Employees -5.2% N/A -12.5% Framework Grades 1-8 Non- Framework Grades -30% +10% +10% +18% The University s median gender pay gap for all employees is slightly less (1.1%) than the UK median level as supplied by the Office for National Statistics (ONS). The median base pay gap across genders in the full-time employee group is 1.2% greater than the UK. In the case of parttime employees, the University has a median base pay gap in favour of females 7.3% higher than the UK median pay gap. The University compares favourably against data that was collected within the 1994 Group in UoY Equal Pay Review April 2014 v3.docx Page 18

19 Table 10.6 Russell Group comparisons Overall Gender Pay Gap University University C University B Mean Gender Pay Gap Median Gender Pay Gap Year 30.82% 33.74% % N/A 2012 University E University A University G University D 24% N/A % N/A % 23.3% % 18.62% 2013 University F On Framework grades only 11% 11% 2013 York 20.56% 18.62% 2013 Five other Russell Group universities publish gender equality pay data but do not publish the overall mean or median pay gap figure for all staff. They show the grade for grade comparisons which obviously do not give an indication of the total gender pay gap. In terms of the Russell Group members who do publish data in the same way as we do, we compare favourably both for our mean and median gender pay gaps. There may be a reason why several Russell Group universities do not publish their overall gender pay gap figures as the headline figures for the sector in general are significantly higher than for other sectors in the UK. 11. Conclusions There are gaps in the average (mean) and median base pay for overall staff categories and the total population for different characteristics contained in the Equal Pay Review. However, grade for grade, there are no significant gender pay gaps which means that the pay gaps do not arise from employees being paid differently for work of equal value. Whilst the different pattern of jobs held across employee groups may be related to external social and economic factors, the pay gaps do not appear to be exacerbated by the University s pay policies and practices. UoY Equal Pay Review April 2014 v3.docx Page 19

20 The overriding cause of our overall gender pay gap is the large number of highly paid male employees vs. the smaller number of highly paid female employees. With the gender split in the professoriate at 77% Male and only 23% Female (and at 94% Male and only 6% Female in Prof Band 3), the gender pay gap will always be a reflection of this imbalance. Within the Senior Management Pay Group, the gender split is 67% Male and 33% Female. There are also other background factors in explaining the overall pay gaps across employee groups, such as the prevalence of part-time job opportunities in lower graded posts, which tend to be more attractive to women. Although the pay gap figures may initially appear quite high, they mirror existing patterns in Higher Education and in the UK workforce. It does not mean that the University s pay practices are flawed, but we will continue to check their justification, eliminate bias and maximise fairness. An Equal Pay Audit will be carried out every 2 years. This will start to give us a clearer insight into our University-wide profile and highlight areas for further examination. Additional analysis will be carried out on a more regular basis in support of other initiatives including Athena Swan. This Equal Pay Audit underlines our commitment to monitor our pay practices in order to reward fairly the skills, experience and potential of all staff and enhance the University s reputation and image. We will monitor pay data and seek ongoing improvement as our equality and pay policies are implemented and put into practice. 12. Recommendations 12.1 This Equal Pay Audit raises a number of issues and it is recommended that these be explored further and more detailed recommendations brought back to SMG at a later date. These will include further analysis on starting salaries Additional job or market related payments should be included in future equal pay audits It is proposed that this Equal Pay Audit in addition to being discussed within SMG is shared with the Operations Group, the Equality & Diversity Committee (EDC), the Athena Swan Working Group and with campus trade unions at a future JNCC meeting. SMG is asked to confirm that this distribution is appropriate. UoY Equal Pay Review April 2014 v3.docx Page 20

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