This guidance note is designed to be used in conjunction with the Commissions equal pay audit model. It describes some options for estimating equal value in the absence of a single job evaluation scheme covering all the employees within the scope of your audit. It supports step 2 of the model, identifying equal work.
Whilst every effort has been made to ensure that the advice given here is accurate, only the courts or tribunals can give authoritative interpretations of the law.
The concept of 'work of equal value' derives directly from the (gender-related) Equal Pay Act. However, the concept appears equally relevant to equal pay claims based on ethnicity, disability, or contractual status. For example, it seems probable an employment tribunal would accept as a defence to such a claim a substantiated argument that the work of the comparator was of significantly greater value than the work of the claimant.
Once you have identified work of equal value, you will be able to analyse your pay data by ethnicity, disability, age and contractual status, as well as by gender, in order to establish whether there are significant pay gaps based on any of these diversity strands. For more on this see Step 2.
The most reliable and objective approach to determining equal value is to use a single job evaluation scheme designed and implemented to take account of equal value considerations and your specific job population. Such a system will assess the demands of jobs under headings such as effort, skill, decision and responsibility.
Those organisations which do operate a single job evaluation system covering all employees, can rely on their work rated as equivalent checks, perhaps supported by selected like work checks for the purpose of their equal pay review. They will also need to undertake an equality review of the design and implementation of the job evaluation scheme. For more on this see Step 2.1 job evaluation.
Those organisations which do not operate a single job evaluation scheme covering all employees, should seriously consider introducing such a scheme.
Where it is judged impractical to introduce a single job evaluation scheme, you will need to estimate equal value between jobs not covered by the same job evaluation scheme. This could vary from a small number of, for example, senior managers not covered by an existing scheme, to all employees where there is no job evaluation at all.
Possible methods for estimating equal value
A number of possible methods for estimating equal value are offered below. It should be noted, however, that none will be an acceptable alternative to a rigorous job evaluation-based approach to assessing equal value. These methods provide a risk assessment tool, rather than a robust defence to an equal pay claim.
Select from the list below the description that best covers the situation in relation to your own organisation. The links will take you to detailed instructions on how to proceed.
- Equal value check 1. For organisations with two or more job evaluation schemes covering between them all or nearly all employees
- Equal value check 2. For organisations with two or more separate grading (and pay) structures, at least one of which is based on job evaluation
- Equal value check 3. For organisations with no job evaluation and a single grading or banding structure based on a single set of criteria, for example, grading definitions, skill or competence levels
- Equal value check 4. For organisations with more than one formal grading or banding structures, or no formal grading structure
- Equal value check 5. For organisations with no job evaluation, but with clear job families or other occupational group hierarchies
- Equal value check 6. For any organisations for which none of the previous checks are appropriate.