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Case Study: Equal Pay - HBOS PLC
HBOS conducted their first Equal Pay Audit (EPA) in 2003. However, this was fairly high level and did not result in the need for specific actions A more detailed audit was carried out during 2006 to establish whether the company was rewarding all employees fairly.
The EPA included almost all staff (approximately 62,000) at all levels from clerical to senior manager. It also sought to evaluate some of the key messages that had arisen from the annual Colleague Opinion Survey, which had highlighted a perception of inequitable pay distribution from both a gender and a minority ethnic perspective.
The audit was based on the Equal Opportunities Commission’s Five Step Model. Data was disaggregated by the following major categories: gender; average basic salary, bonus and total pay; full-time and part-time hours and like for like comparison of full-time equivalent salary; age; job grades; ethnicity; disability; length of service; location; and Division.
The main finding was that the reward structure was equitable and there is neither gender-related pay bias, nor bias in the other diversity strands investigated. However, a number of specialist areas, which by their nature are associated with higher market pay premia, tended to be male dominated. Therefore more emphasis will be placed on addressing this under-representation to attract more female applicants.
An Action Plan has been agreed with trade unions on four main themes:
- Pay - ensuring the current robust pay management processes are maintained
- Bonus- regular monitoring of bonus arrangemnets to check fairness and equity across different specialisms
- Culture - the Action Plan will focus on this area to gain a clearer understanding of perceptions around the barriers to progression at the lower rungs and why the higher paying specialisms are male dominated (and within this to re-design their graduate programme to attract new starters into the under-represented areas, to re-focus the recruitment processes)
- Equal Pay Audit - a rolling programme is being established to monitor the progress of the Action Plan and to conduct another comprehensive EPA in 3 years.
Every Division is formulating its own tailored Action Plan and is regularly monitoring progress.
Lessons learned:
- Senior level commitment essential
- Need to be clear about data required and keep presentational material simple
- Engage relevant individuals from the outset to ensure ‘buy-in’
- Appoint a manager to oversee the process
- Distinguish between equal pay and equal representation issues
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