The landscape for gender pay gap reporting is shifting fast, and multinational organisations face a maze of obligations in the different countries in which they operate. This poses practical and operational challenges.
Approaches to pay gap reporting vary vastly between countries; thresholds for employee numbers required to trigger reporting requirements differ, as do the definitions of which ’employees’ are included and what constitutes ‘pay’. In some countries, it is also necessary to compile data by reference to job category, race, and ethnicity.
Large organisations will meet the trigger points in many countries in which they operate. But common themes and methodology for collecting and analysing data will apply regardless of the country in which such obligations may occur.
The first step in the process is to decide which group of individuals will be responsible for co-ordinating the complex exercise of gathering and monitoring data. The team will likely be led by a senior HR professional and will include colleagues from payroll and legal functions. A board-level director may be required to take overall responsibility for the process due to the high sensitivity of the data involved.
Compiling the raw data from various parts of the organisation will be a major task in itself, but is only part of the process. By trawling through the figures and looking across the business and different territories, organisations should seek to uncover discrepancies and provide explanations. As important as ‘why’ the gap exists, is what steps an organisation will take to address the gap as part of a wider HR strategy.
This exercise should provide a valuable blueprint for addressing other issues around diversity, equality and social responsibility, and a key benchmark by which organisations will be judged by clients, suppliers, employees, and other stakeholders. It will not solve the problem overnight and may not eliminate the divide entirely, but the gender gap reporting exercise will give senior management a vital tool for measuring progress.
Stephen Ravenscroft is partner in the global employee, compensation and benefits practice at global law firm White and Case