WEST UC LIMITED GENDER PAY GAP REPORT 2017
West 2017 Gender Pay Gap Report This report contains the statutory disclosure of the gender pay gap for West UC Limited (hereafter referred to as West in this report) as at the date of 5 April 2017. All UK companies with 250 or more employees are now required to publish their gender pay gap under new legislation that came into force in April 2017. Employers have to make public the gap between men and women on both a median basis and a mean basis. In addition, employers are required to disclose the gender distribution by pay quartile effectively splitting the workforce into four groups based on their pay and then demonstrating the proportion of men and women in each of those groups. Pursuant to the requirements stated within section 78 of the Equality Act 2010, West is keen to publish the Gender Pay Statistics which includes that employers disclose the percentage of employees by gender receiving bonuses in addition to their basic salary, together with the gender gap on bonuses. headshot for Karen West wants to encourage new talent and new ideas across the entire enterprise. To do this we need to ensure we have teams that reflect the diversity of each part of the world in which we operate. We must strive to allow each employee the opportunity to build a successful career without compromising personal goals, to recognise each employee as unique and to give them a voice. To do all of this, we must be open and inclusive, whilst maintaining operations that are above all else, fair. 2017 saw the launch of our Women of West, with the mission to empower women across the West Group Corporation to create and strengthen connections, as well as foster professional and personal growth. Karen Whalen Chief Human Resources Officer westuc.com
WHAT IS THE GENDER PAY GAP? Gender Pay Gap The gender pay gap is the measure of difference between the hourly rate of pay of male and female employees across the organisation (as laid out in the regulations), expressed as a percentage of men s earnings. In Britain there is an overall gender pay gap of 18.1%. Equal Pay Gender pay gap is not the same as equal pay. Equal pay means that men and women in the same employment performing like work or work of equal value must receive equal pay, as set out in the Equality Act 2010. Mean and Median The gender pay gap reporting regulations require both the mean and the median to be reported. These measures are complementary and illustrate different aspects of the distribution of pay within an organisation. The mean is an overall average of the whole organisation and is therefore directly impacted by any extremely high or low salaries at the top or bottom of the sample group. In other words, a small number of individuals have the ability to significantly skew the mean and therefore reduce its gravitas. The median is the midpoint of the sample. Therefore in relation to gender pay, the median shows the middle-most salary of the organisation once all salaries are lined up from lowest to highest. SAMPLE MEAN CALCULATION SAMPLE MEDIAN CALCULATION Female hourly rate 5 5 5 7 7 10 10 15 20 35 40 Median = middle of the range = 10 Male hourly rate *Hypothetical example for illustration purposes only 5 7 10 12 15 20 20 25 30 40 50 Median = middle of the range = 20 *Hypothetical examples for illustration purposes only
GENDER PAY AT WEST Mean Median Gender Pay Gap 29.8% 27.6% Gender Bonus Gap 58.5% 29.3% PAY QUARTILES BY GENDER FEMALE MALE LOWER LOWER MIDDLE 98.5% The proportion of male employees in West receiving a bonus 97.7% The proportion of female employees in West receiving a bonus 30.5% 41% 69.5% 59% Includes all employees whose standard hourly rate places them at or below the lower quartile UPPER MIDDLE Includes all employees whose standard hourly rate places them above the lower quartile but at or below the median UPPER 41% 59% 30.5% 69.5% Includes all employees whose standard hourly rate places them above the median but at or below the upper quartile Includes all employees whose standard hourly rate places them above the upper quartile
WHAT ARE THE UNDERLYING CAUSES OF WEST S GENDER PAY GAP? West ensures equality in the recruitment practices across the organisation and as a result enjoys an average 47/53 % split of male to females in our workforce. The Company is committed to the principle of equal opportunities and equal treatment for all employees, regardless of sex, race, religion or belief, age, marriage or civil partnership, pregnancy/ maternity, sexual orientation, gender reassignment or disability. It has a clear policy of paying employees equally for the same or equivalent work, regardless of their gender (or any other characteristic set out above). As such, it: Disseminates annual online mandatory equality training; COMPENSATION COMPOSITION In accordance with the gender pay gap calculation guidelines, employee salary which is committed to salary sacrifice schemes has not been included in the earnings figures. West observes a 99% participation in the UK pension scheme through salary sacrifice which therefore has very little impact on the gender pay gap due to equal distribution across genders. However, the Childcare Voucher Scheme through salary sacrifice is more utilised by women (62%) than men (38%), with the average salary sacrifice of women being 30% higher than the salary sacrifice of men. This therefore will have an influence on West s gender pay gap statistics. Carries out pay and benefits audits at regular intervals; Evaluates job roles and pay grades as necessary to ensure a fair structure. West is therefore confident that its gender pay gap does not stem from paying men and women differently for the same or equivalent work. Rather its gender pay gap is the result of the organisation s geographic demographic; compensation and benefit composition across business functions; combined with the roles in which men and women work within the organisation and the resulting salaries / packages that these roles attract. GEOGRAPHY West currently operates in 3 core locations in the UK to include 2 offices in the South East and 1 office in the South West. These locations carry varying premiums on salary due to the differentials in locational cost of living and the South East generally has salaries that are 10-15% higher than similar roles in the South West for this reason. The South East offices cater for 90% of the business sales roles; roles which attract a higher rate of pay due to their very nature and therefore the demographic of the business will have a direct impact on West s gender pay gap.
TEAM COMPOSITIONS Across the UK economy as a whole, men are more likely than women to be in senior roles (especially very senior roles at the top of organisations), while women are more likely than men to be in frontline lower paid roles in the organisation. In addition, men are more likely to be in technical and IT-related roles, which attract higher rates of pay than other roles at similar levels of seniority. Women are also more likely than men to have had breaks from work that have affected their career progression, for example to bring up children. They are also more likely to work part-time, and many of the jobs that are available across the UK on a part-time basis are relatively lower paid. This pattern from the UK economy as a whole is reflected in the make-up of West s workforce, where 71.1% of front-line customer service roles are women, while 78.9% of the relatively highly paid sales and senior management roles are held by men and not women. This can be seen above in the table depicting pay quartiles by gender. This shows West s workforce divided into four equalsized groups based on hourly pay rates, with the lower quartile including the lowest-paid 25% of employees, of which 69.5% are female and the upper quartile covering the highest-paid 25%, of which 69.5% are male. The fact that there are more women in the lower paid quartile of West is a major driver of the overall gender pay gap. In order for there to be no gender pay gap, there would need to be an equal ratio of men to women in each quartile. In order to demonstrate the degree of impact that the placement of genders across the business functions have within West, additional statistical analysis was conducted to observe the individual gender pay gaps within the following functions: director & above; senior management; finance, sales, IT & facilities; operational delivery; human resources and legal. This analysis highlighted that within each function, the individual gender pay gap is lower than the UK national average. In fact the average of these departmental gender pay gaps combined becomes 10.2%, demonstrating that it is truly the split of genders across the different functions and levels and the corresponding salaries that those roles command, that directly impact West s gender pay gap and take it above the national average. WEST S GENDER BONUS GAP The data used to produce the gender bonus gap is taken across the period April 2016 to April 2017. It includes payments to relevant employees such as bonuses, incentives, sales commission and financial service awards. The sums paid under these categories vary greatly, with total annual individual sales commission figures starting at a value that is more than the highest bonus pay out in the data period. However, a major factor affecting these figures is that bonuses were removed from all non-sales roles during the data period and therefore the data set only contains one quarterly bonus payment for that group, not four payments. Whilst 80% of all bonus potentials were added to basic salaries, the bonus removal affects the paid bonus data for the year with significant impact to the departments that are predominantly female, such as the service functions. Therefore, West s gender bonus gap is derived from the comparison of a successful sales force, approximately 70% of which are male, with the service teams in receipt of one quarterly bonus payment, approximately 70% of which are female, producing a significantly inflated gender bonus pay gap for West.
WHAT IS WEST DOING TO ADDRESS ITS GENDER PAY GAP? The gender pay gap is not a subject about which West is complacent, and the company is committed to taking the actions that it can to reduce the gap. However, West also recognises that its scope to act is limited in some areas - it has, for example, no direct control over the subjects that individuals choose to study or the career choices that they make. The steps that West has identified to promote gender diversity in all areas of its workforce include the following: Creating an evidence base: To identify any barriers to gender equality and inform priorities for action, in 2018 West plans to introduce gender monitoring to understand: the proportions of men and women applying for jobs and being recruited; the proportions of men and women applying for and obtaining promotions; the proportions of men and women leaving the organisation and their reasons for leaving; the numbers of men and women in each role and pay band; take-up of flexible working arrangements by gender and level within the organisation; the proportion of men and women who return to their original job after a period of maternity or other parental leave; and the proportion of men and women still in post a year on from a return to work after a period of maternity or other parental leave. Reviewing the flexible working policy: West s flexible working policy is available to employees in all areas and levels of the organisation, regardless of their role and level of seniority, and that flexible working need not be limited to part-time working. However, flexible working in practice and the question of where the work goes is a key point to review in the enabling of the organisation to truly become agile. Supporting parents: West will develop new guidelines for managers on supporting employees prior to, during and on return from maternity and other parental leave, to be backed up by training for all line managers and senior managers. None of these initiatives will, of itself, remove the gender pay gap - and it may be several years before some have any impact at all. In the meantime, West is committed to reporting on an annual basis on what it is doing to reduce the gender pay gap and the progress that it is making. In the coming year, West is also committed to: Reviewing its policy on bonus and commission payments; Reviewing the training provided to management in regards to allocating pay awards; Creating an action plan targeted to review and improve where possible the balance of genders within each pay quartile.
DECLARATION We confirm that West s gender pay gap calculations are accurate and meet the requirements of the Regulations. The calculations, data and assertions contained in this report have been fully assured by the West Legal, Compensation and Human Resources teams, who have confirmed that the methodology provided in The Equality Act 2010 (Gender Pay Gap Information Regulations 2017) has been applied correctly. I, Amrik Mann, Senior Director Human Resources, confirm that the information in this statement is accurate. westuc.com hrservicesmea@west.com