Creating a fairer Britain
Your equal pay audit must compare the pay of employees in different protected groups - for example, men/women; minority ethnic/white employees - doing ‘equal work’. This is the foundation of an equal pay audit. Everyone involved in your audit needs to understand the concept of ‘equal work’.
Under the equal pay provisions of the Equality Act 2010 men and women in the same employment who are performing equal work should receive equal pay. The precise principles for determining equal pay irrespective of race or disability are not laid down in law. For the purpose of this guidance, we assume that the principles of the Equality Act 2010 - which prescribe equal pay for equal work performed by women and men in the same employment - would 'read across' for ethnicity and disability.
So, depending on your organisation, you will need to compare the pay of protected groups doing one or more of the following three aspects of equal work.
This means where men and women are doing work which is the same or broadly similar.
Men and women are likely to be doing like work where they have the same job title, or where, even if their job titles differ, they do the same or broadly similar work.
Like work is a useful basis for equal pay comparisons in almost all organisations. Pay gaps for like work are still surprisingly common.
Job titles - the most common indicator of like work - can be misleading. You will probably need to review the job titles in your system early in your audit to ensure that the same, or very similar, titles really do indicate like work.
Apparently dissimilar jobs can be seen as like work e.g. lecturers of different subjects within the same employment.
Do not restrict your equal pay audit to checking only for like work, as this will not consider the relative pay of jobs that are different but equal, and may put you at risk of equal pay claims.
For more info on like work and good practice guidance see Equal pay in practice - like work.
This means where men and women have had their jobs rated as equivalent under an analytical job evaluation scheme.
Men and women are likely to be doing work rated as equivalent where they have similar, but not necessarily the same, job evaluation scores and are in the same grade.
Work rated equivalent
If you have a grading structure, you can use grades as a starting point for comparing the pay of protected groups. For most organisations comparing pay of protected groups by grade is the most practical starting point for an equal pay audit.
If your organisation uses broad bands narrower points ranges may need to be selected.
If you use analytical job evaluation schemes you need to check your scheme has been designed and implemented in such a way that it does not discriminate on protected grounds. Employers who use bought-in job evaluation schemes should ask their supplier if the scheme meets this standard. The toolkit contains detailed guidance on equality proofing job evaluation.
Look carefully at jobs just above and below grade boundaries - especially if they are dominated by particular groups as these could easily be regarded as rated as equivalent, even though they are in different grades.
Grading which is not based on analytical job evaluation will not provide you with an automatic defence against equal pay claims.
This means work that is different but which is of equal value in terms of the demands of the job. 'Demands' mean the skills, knowledge, mental and physical effort and responsibilities that the job requires.
For more information see Which equal work checks apply in my organisation?
While some employment tribunal cases have considered the question – ‘what is equal?’ – the answer really lies in the application of analytical job evaluation.
Equal value work
Jobs that may be entirely different in content can be of equal value when the demands made on the employees doing them are assessed. The golden rule is not to assume that jobs that are of different types (e.g. manual/ administrative, academic/ non-academic) cannot be of equal value.
The most reliable way of assessing whether jobs are of equal value is to use an analytical job evaluation scheme specifically designed and introduced to take account of equal value considerations and of the types of jobs being done by your workforce. Ideally the scheme should cover all employees.
If you do not use analytical job evaluation you need to find an alternative means of checking whether protected groups are doing work of equal value. It is important to recognise that these alternative estimates of equal value are not as reliable as analytical job evaluation, and that the organisation is therefore still vulnerable to equal pay claims.
For some suggestions for assessing equal value in the absence of job evaluation see 'Assessing equal value.'
See also Step 2 - additional information
For more information on work of equal value see Equal pay in practice - work of equal value
Please send any feedback or enquiries to equalpayfeedback@equalityhumanrights.com.