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Four red flags for HR from the BBC pay report

20 Jul 2017 By Emily Burt

‘Principle of greater transparency’ means more employers could find themselves in the firing line over top earners’ salaries

The BBC pay report caused outrage yesterday after the publication of salaries of on-air talent earning more than £150,000 revealed glaring discrepancies. Here’s why HR needs to give the report a closer look:

Diversity

Women comprised only a third of the BBC’s high-earning staff, with the highest-earning man, Chris Evans, earning more than four times the salary of the highest-earning woman, Claudia Winkleman.

The lack of diversity went beyond gender, with no one with black, Asian and minority ethnic (BAME) backgrounds featuring in the top 10 earners. While the director of strategy and external affairs at the Chartered Management Institute, Petra Wilton, said the BBC was “falling short” on BAME representation, she added that, with 10 BAME individuals on the full list of 96 earners, Auntie’s representation was higher than many of the top UK businesses covered in its Delivering Diversity report released earlier this month.

Equal pay

The report highlighted a deep divide between pay for men and women, but experts have been quick to warn that some discrepancies could be more problematic than others and could, in theory, lead to an equal pay dispute. In particular, some commentators pointed out that newsreader Huw Edwards is earning up to £250,000 more than female peer Fiona Bruce.

“If [the BBC] hasn’t got a legal argument to explain why one presenter earns more than another they will have an equal pay issue on their hands,” Matthew Ferro, reward consultant at Paydata, told People Management. “This is about presenters who have the same background, skillsets and abilities, and it could prove very hard for an employer to explain away, especially in the public eye.”

Meanwhile, comparing sports commentator Gary Lineker's £1.9m salary with colleague Clare Balding’s £199,000, Karen Jackson, managing director at didlaw, said Balding could have a legal case, “unless the BBC can show there is a substantial and legitimate reason for the discrepancy”.

Employee contracts

Rumours have already surfaced that, in a bid to equal pay, the BBC may ‘pull the lever’ by cutting salaries among their highest-paid male staff – but lawyers warned that this may cause a fresh set of problems.

“This would have to be with the male presenters’ agreement and, if they unilaterally change their contract without agreement, they could face legal claims from the male presenters as well,” said Jane Crosby, employment lawyer at Hart Brown. She added that organisations must treat the revelations as a “lesson”, and scrutinise their own salaries where men and women are doing the same jobs to avoid costly equal pay claims.

Transparency

Although the BBC pay report is an extreme example of salary disclosure, the gender pay reporting rules now require companies with more than 250 employees to publish details of their gender pay gap and gender bonus data.

“Not all organisations are required to publish top-earner pay like the BBC has, but the principle of greater transparency and taking stock of high pay is right for any business,” said Charles Cotton, reward and performance adviser at the CIPD. “We won’t shift the dial on greater fairness in pay, or on issues such as gender equality, until we see more organisations step up and take a reality check on how they reward their people – and, importantly, whether this can be justified.”  

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