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The legal obligations for reporting gender pay gaps are fairly simple. You only need to publish six digits. These are your mean gender pay gap, mean gender wage gap, mean gender bonus wage gap, mean gender bonus wage gap, the proportion of men and women who receive a bonus, and the proportion of men and women in each quartile band.
And you have until April 5th next year to do so, or a little earlier – March 31st – if you are in the public sector. How could this possibly cause a headache?
When you think about the potential impact of publishing the numbers, you will quickly realize that the consequences can be numerous.
How good looks
The first thing most people ask is whether their numbers will look comparatively good – or not. The truth is, we don't know how good it looks right now. We also don't know how other organizations present their results or what remedial action they might take.
However, organizations have been asked (not asked) to publish these figures due to the gender pay gap. The government wants this to be disclosed to encourage organizations to act.
Wage differences may not be apparent when men and women first enter the world of work. However, income levels tend to differ as employees pursue their individual career path. There can be several valid reasons why a male and female gap is developing, but the size of that gap may surprise you when you look at the averages.
Who will notice?
The second thing to think about is who will be paying attention to these averages. There are clearly groups with a vested interest, such as lobbyists and politicians. They strive to double-check the numbers and highlight perceived inequalities.
Closer to where you live, your company's employees want to compare their income with the average. This will inevitably affect how much they feel valued by their employer. Because these numbers are posted on company websites, they also provide a very visible metric for potential new hires to consider when assessing which companies they might want to work for.
We need to think about what all these people will think when they look at these rough averages.
Room for misinterpretation
There's no need to add additional comments, but without them there is a lot of leeway to get the numbers out of context. A large gender pay gap could easily be interpreted to mean that a company has problems with gender pay inequality – when it may not be at all.
These numbers do not take into account the composition of the workforce or the type of work performed. They are averages for the entire workforce – not a direct comparison between two people who do the same or similar jobs. However, if you fail to provide an explanation of why your organization has a gender pay gap, employees can draw their own conclusions.
Control of the narration
What is clear is that if an organization is to tell the story behind the headlines, it needs to do a more detailed analysis. They have to go well beyond what they are legally obliged to do.
However, it does give companies a better understanding of what is really going on in their company. The results will either help them justify their current compensation policy or help them see that there may be a problem.
If the latter, organizations still have time to take the necessary action to correct the problem before the release deadline comes in next year. And in March or April when their numbers are released and scrutinized, organizations can be at the forefront of making a statement, highlighting what has already been done to address the problem and outlining their future plan of action .