5 ways HR analytics can help you close the gender pay gap

As we approach the deadline for gender pay gap reporting in the UK, it’s a good time to remind ourselves of the challenges that women face in the workplace and the barriers that the pandemic has set in motion. Pay parity is just one element of workplace equality but it’s one where we can clearly see, measure and move the dial. For this reason, the gender pay gap acts as an important yardstick for companies looking to build more equitable workplaces.

The ‘broken rung’ on the ladder of corporate progress still exists, hindering women, and even more so women of colour, from reaching the top echelons of business. McKinsey & Company’s Women in the Workplace report finds that the COVID-19 pandemic has set back the progression of women further, and that one in four women are contemplating downshifting their careers or leaving the workforce completely.

Separately, the World Economic Forum says that closing the global gender gap has increased by a generation from 99.5 years to 135.6 years as a result of the pandemic. Therefore, it’s a critical time for organisations to be clear about their intentions for equitable gender representation.

The role of pay in workplace equity

In the UK, organisations have 12 months to publish their gender pay gap data from the relevant snapshot date. This means that the gender pay gap reporting deadline is 30th March 2022 for public-sector employers and 4th April 2022 for private-sector and voluntary-sector employers. All employers with 250 or more employees are legally obliged to report every year on gender pay using six key metrics.

What role can gender pay gap data play in improving workplace equity? Firstly, it’s a visible benchmark against which progress can be measured year-on-year. Publishing pay gap data also helps to hold companies and their senior leaders accountable for action. McKinsey’s research found that accountability is key to progress on diversity and equity:

“To accelerate progress for all women, on all fronts, companies need to double their efforts when it comes to accountability. Despite saying that gender and racial diversity are among their most important business priorities, only two-thirds of companies hold senior leaders accountable for progress on diversity goals…”.

And lastly, publishing gender pay gap data allows a company to provide a narrative around the gender pay gap, setting out the steps they are taking to reduce it.

What should a gender pay gap narrative include?

Laying out your intentions for closing the gender pay gap, with a plan to move towards them, is an important part of closing the gap and one where HR analytics plays a key role. A narrative can include targets, timelines, initiatives and overall goals for improving diversity, all of which can be illustrated using data from HR analytics.

Here are five areas where HR analytics can provide data-based input into your gender pay strategy:

5 ways to use HR analytics to close the gender pay gap

  1. The six metrics that should be included in gender pay gap reporting cover mean and median pay, bonus and employees on full pay all split by gender (more information on them can be found here). An analytics package like illumin8HR combines HR and payroll data so this information can be accessed quickly and presented in a useable format.
  2. To go beyond the requirements and look deeper into the gender pay gap, HR analytics has the capability to take pay and gender data and present it alongside other metrics. For example, how does the data look when you plot gender and pay against job role, seniority, location or manager? Use analytics to map and present this to team leaders or the senior team.
  3. Looking back over time at data from previous years is a powerful way to demonstrate progress made – or a lack of it. How is your organisation making changes year on year? Has any demonstrable progress been made and is that progress the same for all ethnicities, locations or job types?
  4. By combining pay and gender data with promotion data, HR analytics can model career progression over time, analysing the career paths of women compared to other genders. Is your organisation offering the same training and development opportunities to all, regardless of gender? If the same opportunities are either not available, or not accessible to females, the organisation will fall behind on building a female leadership pipeline. Equitable progression, in tandem with pay, is crucial to building a diverse workforce.
  5. A comprehensive analytics package will allow you to use your data to set goals around gender pay, so even if progress has been slow to date, what do you need to change and what actions will get you there? Using illumin8HR, users can put in place targets, dates and tasks to tangibly close the pay gap – and importantly, demonstrate and report on it.

Becoming data-led in how your organisation plans, acts and reports on gender pay makes turning the dial on diversity more visible, accountable and manageable. By bringing together internal HR and pay data using HR analytics, HR can paint an authentic picture of the gender pay gap and consider the actions needed to make a difference.

If you’d like to learn more about the capabilities of illumin8HR as we approach this year’s reporting deadline, please get in touch with us to see a demo.

Click here to book a demo

Related Blog Posts