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Equal Pay Audits
The main focus of equal pay legislation is closing the gender pay gap. But employees can also claim for equal pay on other grounds, such as race, disability and age.
The Equality and Human Rights Commission (EHRC) is the leading body responsible for equal pay. The EHRC works to:
- Eliminate discrimination
- Reduce inequality
- Protect human rights
- Build good relations.
Its role includes publishing guidance about how to design pay systems so that they are more likely to be fair. Whilst their advice is not legally binding, it is useful to gauge whether your pay system discriminates in practice. The only way to answer this question, however, is to conduct an equal pay audit.
How do equal pay audits work?
The EHRC has set out five steps in an equal pay audit process:
- Decide the scope of the audit
- Determine where people are doing equal work
- Collect and compare pay data
- Establish the causes and justification for significant pay gaps
- Develop an equal pay action plan.
Equal pay measures three key building blocks in the workplace:
- Like work – where people are doing the same or broadly similar jobs (for example, in finance teams “like work” might include all accounting and auditing jobs at a given level)
- Work rated as equivalent – where a job evaluation scheme operates and all those jobs graded the same are compared together
- Work of equal value - where there is more than one job evaluation scheme, or no job evaluation scheme in place. With multiple schemes, the first step is to establish grades that have equal demands, so jobs can be compared across schemes; where no scheme exists, the assessment method depends on the circumstances involved. In Paydata’s experience, most customers need help organising and processing their data. We can produce equal pay reports to highlight potential problems, and examine data in further detail to show areas that need attention. We can also provide pay modelling services to help you develop and implement an equal pay action plan.
Having a robust job evaluation scheme will make your equal pay audit easier and more robust. If you don’t have a scheme (or your scheme isn’t up-to-date), Paydata can conduct an audit on your behalf. We can also use the job evaluation scheme that underpins our salary surveys; whilst not a defence in law, it does provide a basis to spot potential equal pay issues.
Paydata equal pay audit and job evaluation services
If you would like to know more about our equal pay audit or job evaluation services, please get in touch.