EY announces UK pay gap ahead of Government regulations
09 October 2017
EY has today published its gender pay gap figures for the UK, six months ahead of the Government’s regulatory deadline of April 2018. EY has also gone beyond the Government’s regulations by publishing its ethnicity pay gap and is calling for other companies to follow its approach to ensure appropriate focus is given to this equally important measure of diversity.
Based on the Government’s methodology, EY’s median gender pay gap is 14.8% - compared to the national ONS median 18.1% - and is estimated to have improved by around 10 percentage points compared to 2012 as a result of the firm’s sustained focus on progress in diversity and inclusion. EY’s median ethnicity pay gap for the UK was calculated at 9.8%.
Under the Equality Act of 2010, EY is firmly committed to equal pay and ensuring that a man or woman doing the same or a similar role are paid equally. Our internal analysis shows that we pay equitably for like roles across gender and ethnicity. The latest UK Government’s Gender Pay Gap regulations are designed to show differences in the average (median and mean) earnings between men and women, as a percentage of men’s earnings. The regulations apply to any organisation with over 250 employees and highlight the different occupations, and seniority of roles, that men and women are concentrated in.
As with most UK companies, a pay gap is likely to persist until there is equal or proportionate gender and ethnic minority representation at every level and job role in the firm. EY’s analysis shows that the representation levels in the firm — with more men at senior levels and fewer in less senior positions — means the average male salary (median or mean) is higher than the average female salary, although this is changing. A similar pattern shows that the ethnic minority population holds fewer senior level roles, contributing to an ethnicity pay gap. A larger proportion of women in EY’s more junior administrative and workplace services has also contributed to its pay gap. EY’s median gender pay gap for client serving staff would be 9.6% and the median ethnicity pay gap would be 8.6%.
EY is making excellent progress on gender and ethnic diversity, in terms of both the occupations and seniority of roles that people in the firm have. For example, EY set down targets to have at least 30% female and 10% Black and Minority Ethnic (BME) representation in its new partner intake, measured on a three year rolling period; in 2017 those figures stand at 27% and 13% respectively. Nearly 40% of EY’s UK LLP Board are also women and 6% are BME. EY’s partnership in the UK is 20% female, and 9% BME.
Steve Varley, EY’s UK Managing Partner comments: “We have made strong progress in the last five years to improve the representation of diverse talent, in all its forms, and we have an action plan in place to tackle this business critical issue. However, we know there is more work to do to speed up the process of achieving parity in the workplace and looking at this challenge through the lens of the pay gap figures has given us even greater resolve.
“Publishing both our gender and ethnicity pay gap will help to ensure that we have an equal and sustained focus internally on improving these measures of diversity. We also hope to advance change by encouraging other businesses to follow this approach. It is a commercial imperative for EY and part of our business purpose - to build a better working world – improving diversity and inclusion in our own business and contributing to change in wider society.”
EY has introduced over 20 progressive initiatives in the UK to continue to improve the representation of diverse talent and further reduce the firm’s pay gap for both gender and ethnicity. These includes its CareerWatch and BME Leadership programmes, which provide mentoring and sponsorship to high potential female and BME talent from senior leaders in the firm; over 26 employee networks such as its EY Black Network and Women’s Network; and EY Reconnect which is designed to help people back into the profession after a career break.
EY has robust monitoring of processes such as recruitment, promotion, performance assessment and nomination to leadership programmes through a gender and race lens. This includes placing greater rigour and measurement over the representation of women and ethnic minorities on its client project teams. EY’s shared parental leave policies aim to make being a working parent a gender neutral decision. At the same time EY is seeking to break down the gender stereotypes that it believes results in the imbalance of take up in the administrative roles in the firm. These initiatives and measures come together to ensure that all of its people have equal access to the best development opportunities to enable them to progress their careers.
Steve Varley adds: “To increase the diversity of our own organisation we have taken a two-pronged approach, the first is the most fundamental – cultural change. The ‘game changer’ on this agenda is shifting the perceptions and behaviours of our people across the organisation, to create an inclusive and flexible working culture, where everyone can thrive and be themselves at work. At the same time we know that, by particularly supporting our female and BME talent with targeted initiatives, we can increase the diversity of our leaders.”
EY is also proud to have supported the work of The Parker Review report, Beyond One by ’21, into ethnic minority representation in FTSE 100 and FTSE 250 boardrooms.
Business Minister Margot James MP commented: “We are working closely with the business community to create an inclusive and diverse workplace where everyone, regardless of their background, can succeed.
“Greater transparency has proven to be effective in bringing about cultural change so I welcome EY’s decision to be open about the diversity of its workforce and urge other employers to do the same.”
For further information on EY’s pay gap, see our full report