Tesco reports a 12% mean gender pay gap


Supermarket organisation Tesco UK Retail has reported a 12% mean gender pay gap for fixed hourly pay across its five UK entities as at April 2017.

The organisation has reported its gender pay gap data across its 225,000 UK employees in line with the government’s gender pay gap reporting regulations and ahead of the private sector submission deadline of 4 April 2018.

The gender pay gap reporting regulations require organisations with 250 or more employees to publish the difference between both the mean and median hourly rate of pay for male and female full-time employees; the difference between both the mean bonus pay and median bonus pay for male and female employees; the proportions of male and female employees who were awarded bonus pay; and the proportions of male and female full-time employees in the lower, lower middle, upper middle and upper quartile pay bands.

Tesco’s median gender pay gap for fixed hourly pay as at April 2017 is 8.7%.

Its mean gender pay gap for bonuses paid in the year to April 2017 is 42.6%, and the median gender pay gap for bonus payments is 27%. Over this period, 77% of female employees received a bonus payment compared to 73% of male employees.

Two-fifths (40.7%) of employees in the highest pay quartile at Tesco are female, compared to 50.6% in the second quartile, 60.1% in the third quartile and 67.6% in the lowest pay quartile.

Tesco has attributed its gender pay gap firstly to the fact that male employees are more likely to work shifts that pay premiums, for example night shifts, on bank holidays and on Sundays. When premium payments are excluded from the gender pay gap figures, Tesco’s analysis shows that its median gender pay gap would reduce to 2.7%.

Another contributing factor to Tesco’s gender pay gap, according to its report, is the higher proportion of male employees working in senior roles, which attract higher bonus opportunities. This impacts both Tesco’s hourly pay gap and its bonus pay gap. In contrast, 73% of employees working on a part-time basis at Tesco are female. This affects the organisation’s bonus pay gap, as bonuses are paid proportional to employees’ working hours. When bonuses for full and part-time employees are analysed on an equivalent basis, taking into account pro-rating for part-time staff, the overall bonus pay gap reduces to 7.1%, according to Tesco’s report.

To address its gender pay gap, Tesco has introduced a gender diversity target of having at least a third of women on its board by 2020. In addition, the retailer has signed up to the 30% Club, which encourages businesses to achieve a minimum of 30% female representation in senior leadership roles by 2020.

Furthermore, the organisation has increased its learning and development opportunities for women through its Women in Business network and by partnering with Everywomen, a network for females in business. Tesco has also improved its maternity pay, introduced shared parental leave, provided inclusion training for its top 50 UK leaders and enhanced access to coaching support for female employees.

Tesco is also reviewing its approach to flexible working, exploring working options such as term-time only contracts, seasonal work and friends and family job shares, as well as trialling technology that would give employees more control of their work schedules. The organisation has created an inclusion advisory panel to help it learn how to best support diverse employee groups, and is conducting a pilot scheme with Timewise. This will test how to unblock career progression for part-time employees through greater flexible-working opportunities in managerial roles.

Tesco has monitored its gender pay gap since 2002 and has voluntarily reported its gender pay gap data since 2012.

Matt Davies, chief executive officer at Tesco UK and Republic of Ireland (ROI), said: “We believe that long-term, sustainable change will take time. But we also believe it is the right thing for our business and essential for our long-term future.

“We are confident that by understanding what’s driving the pay gap we see at the moment, and responding with clear, positive and inclusive actions that are guided by our values, we can do even more to make Tesco a place where everyone can get on.”