Hospitality gender pay gap reporting - could reported data be misleading?

Written by: Mike Shipley

Hospitality gender pay gap reporting - could reported data be misleading?
Under new laws in the UK, employers with 250 employees or more will need to publish their annual gender pay gap data. Launched in April this year, the scheme is designed to shine a light on gender inequality in the workplace, and means that 9,000 employers will need to publish their data by April 2018.

To comply with the legislation, employers must publish calculations that show:

  • The average gender pay gap as a mean average and as a median average
  • Average bonus gender pay gap as a mean average and as a median average
  • Proportion of males receiving a bonus payment, and the proportion of females receiving a bonus payment
  • Proportion of males and females when divided into four groups ordered from lowest to highest pay

For hospitality organisations, pulling together the correct information to be able to perform (and check) the calculations will be a challenge – especially if their payroll processes are still largely manual. The complexity of staffing in hospitality means many organisations will have employees on different contracts, performing multiple roles, and paid to different schedules (e.g. monthly and weekly), all of which need to be analysed and included in the calculations.

However, there’s another challenge that’s looming for the hospitality sector, and one that has a potential negative impact for the industry.

According to the guidance from ACAS, only contracted payments should be included in the calculations (i.e. basic pay and any bonus payments that form part of the employment contract). This means that non-contractual payments like tips and tronc (that form an important part of an employee’s take home pay) should not be included.

From the data we collected in Fourth Analytics across 25,000 hospitality workers across the pub, restaurant, QSR and hotel sectors at the end of last year, we know that the front of house workers are predominantly female and may therefore have a greater proportion of their pay coming from tips and tronc.

In fact, when we've worked with customers to collect this data in Fourth Analytics, excluding payments from tips and tronc suggests a favour towards males, while including these payments narrows the gap to either even, or slightly in favour of females.

By excluding these additional payments, the figures that hospitality organisations report could therefore be misleading. Aside from the negative impact this could have on individual organisations, it could also negatively impact the sector as a whole – indicating a more sizeable issue than may actually exist, if at all.

Fourth Analytics can help you quickly and easily generate reports to be able to comply with the new legislation. To find out more, get in touch today.

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