Fresh pressure to ensure fair pay throughout the workplace and equal opportunity to progress is sparking UK employers into action to make sure their compensation and talent management programmes are really delivering. Contributor Hazel Rees, UK leader, Executive Compensation – Willis Towers Watson.
According to a new survey by Willis Towers Watson, gender pay equality is becoming a more important factor for three in five UK employers (58 percent) when making individual base pay decisions. Half of UK employers (51 percent) said they had recently checked their pay arrangements to ensure they are meeting equal pay obligations and almost a third (29 percent) are planning to do so.
“The many debates that we are having in the UK around fairness are being reflected in the workplace. Employees want to know they are being paid fairly and have the same chances for promotion,” says Tamsin Sridhara, UK leader, Rewards and Talent, Willis Towers Watson. “The gender pay gap reporting requirements raised lots of questions for employees and in boardrooms. As a result, we are seeing leading UK employers committed to doing more and leading the way for global peers.”
Market competitiveness remains the main consideration for both UK and global employers in setting base pay. However, the renewed focus on pay equity amongst UK employers is in stark contrast to employers globally. Only one in five global employers (23 percent) reported that gender pay equality is an important factor in base pay decisions.
Removing bias from selection processes
Survey responses reveal increased activity at promoting diversity throughout companies. In the context of gender pay gap reporting, it is not surprising that the primary focus of several of these activities is gender diversity, however the activities can benefit all talent: Flexible work arrangements: Nine out of ten employers (93 percent) responded that they have either already taken steps this year (or are planning to) to promote flexible working arrangements, or are considering taking such action over the next three years.
Re-evaluation of recruitment and promotion processes: Half of respondents (47 percent) are planning to review their recruitment and promotion processes. The main aim of such reviews is typically to reduce any conscious and unconscious bias. Inclusive culture: More than eight out of ten employers (87 percent) responded that they have either already started this year (or are planning to) to increase their communications of activities to promote an inclusive culture, or are considering taking such action over the next three years.
Hazel Rees, UK leader, Executive Compensation, Willis Towers Watson, reflects “The pressure on companies to do more to promote fair pay and diverse talent in the workplace is not going to go away. The new disclosure requirements on CEO pay ratios will reflect another dimension of fairness in the workplace. Likewise, the predicted changes to the UK Governance Code will stress the importance of a diverse pipeline into senior roles and give employees a greater voice.”
