· Features

Hot topic: Greater pay transparency, part two

What issues does greater pay transparency throw up for organisations, and how can they address these?

The BBC revealed the salaries of staff earning more than £150,000 in its annual report for the first time, potentially representing a key point in the journey to greater pay transparency in general.

Frank Douglas, CEO of Caerus Executive, says:

"The release of the BBC pay data has given rise to ongoing discussion about gender pay equity within the corporation and the business world in general. Symptomatic of the general blind spot in regards to diversity in the UK, diversity tends to equal ‘gender’ in most people’s minds. However, there is a greater issue regarding the ethnic minority pay gap.

"While BAME men face a significant pay gap, BAME women are caught in the middle i.e. being female and an ethnic minority. The Economic Policy Institute stated: “Despite the large gender disadvantage faced by all women, black women were near parity with white women in 1979. However, in 2016 white women’s wages grew to 76% of white men’s, compared to 67% for black women relative to white men – a racial difference of nine percentage points.

"CEOs and HR directors need to raise their heads out of the sand. While gender is a more comfortable topic, they need to face the BAME gaps in pay, representation and progression head on. For those getting their A-Level results recently, the hard truth is that race will play a role in their career opportunities and pay."

Stefan Stern, director of the High Pay Centre, says:

"Employers shouldn’t be frightened of pay transparency. Although some injustices may be revealed when you shine a light on people’s pay, recognising you’ve got a problem is the first step back to health. In this age of ‘big data’ why should we be scared of sharing relevant data with staff?

"Hierarchy is not dead and not everyone will get paid the same. But by closing the pay gaps employers can build greater cohesion. Managers waste a lot of time and energy engaging in unnecessary secrecy. By taking an ‘open book’ approach to pay leaders can show that everyone shares a common interest in the success of the business.

"It will also make it easier to gain acceptance from the workforce when difficult decisions on pay have to be taken. “Tell the truth,” Mark Twain advised us. “You don’t have to remember anything.”

Read the first part of this Hot Topic