MPA Staff equal pay audit 

Report: 13
Date: 6 December 2007
By: the Interim Head of Human Resources on behalf of the Chief Executive

Summary

This report sets out the arrangements for, and the outcome of, the MPA staff equal pay audit agreed as part of the 2006-07 pay negotiations. The report covers:·

• The external and internal background to the equal pay audit.
• Previous equal pay audit conducted in 2004.
• The approach to carrying out the 2007 equal pay audit.
• The outcome and recommendations.

A. Recommendations

That the report be noted

B. Supporting information

External and internal background to equal pay audit

1. Externally, there is a legal requirement to comply with the Equal Pay Act and other legislation, which can give rise to equal pay claims. The Gender Equality Duty also requires public authorities to promote equality between men and women and eliminate gender discrimination. Equality reviews are generally regarded as good practice in the Code of Practice issued by the Equal Opportunities Commission and an essential requirement in order to achieve level 3 of the Equality Standard for Local Government (ESLG).

2. Internally, as part of the 2006/2007 pay negotiations, it was agreed with the trade unions that an equal pay audit would be undertaken in 2007. It is three years since the last equal pay audit.

Previous equal pay audit

3. An equal pay audit, commissioned by the MPA, was carried out by the Hay Group in March 2004. The purpose of the audit was to review pay, including an audit of individual salaries and a review of MPA policies, processes and practices. The recommendations of this audit are attached as Appendix 1. These recommendations have been implemented and will be reviewed again as part of the current review of all MPA HR policies.

4. As part of the 2006/2007 pay negotiations, it was agreed that a further equal pay audit would be undertaken in 2007. A revised pay and grading structure was implemented following the 2006/2007 pay negotiations, which essentially re numbered the former Premier and 7 Bands into 9 Grades and changed the former “shadow band” into a substantive Grade 5.

Equal pay audit 2007

5. The MPA worked closely with the Hay Group to undertake a review of equal pay, including an audit of individual salaries, review of policies, processes and practices. The final report was delivered at the end of October 2007.

6. The report concluded that the MPA has policies, practices and procedures in place that assist the Authority to fulfil its obligations under the Equal Pay Act and other related legislation designed to combat discriminatory pay practices. In addition, the Authority has consistent policies that apply equally to all staff, with a few exceptions, the rationales for which are generally well documented.

7. Nevertheless, the Hay Group identified some recommendations that it felt the MPA should consider addressing in order to deal with issues that potentially had equal pay implications.

8. One area of concern related to individuals who appeared to have been placed in the incorrect grade for their Hay job score. This arose particularly at the boundaries between Grades 7 & 8 (the lower grade bands) and Grades 3,4 & 5 (middle grade bands) where the ‘points to grade’ breaks required clarification.

9. The audit report also concluded that, in order to comply with age legislation, the Authority should ensure that pay ranges should not contain more than five incremental spine points and that it should aim to move to such a structure within the next 3 years. At present the MPA pay ranges as introduced in July 2005 contain between 5 and 8 spine points.

10. Overall, it was felt that there appeared to be no inbuilt bias in the pay system, although there was enough flexibility in the processes to allow poor practice to occur if there was not sufficient monitoring. Whilst no specific action was recommended, the report identified a number of categories to be monitored. The report has been shared with the PCS.

11. A summary of the report’s recommendations and the Authority’s implementation plan is attached as Appendix 2.

C. Race and equality impact

The Hay Group conducted an analysis for all staff across the organisation to identify any pay issues between genders, ethnic groups, religion or faith, sexual orientation, age and disability. The Hay Group were specifically asked to review the Authority’s incremental scales in the light of the European Court of Justice ruling in the case of Cadman, which ruled that using length of service to justify pay differences between men and women must be objectively justified. Accordingly, they made the recommendation outlined at paragraph 9 above. Overall, the report concluded there was no inbuilt bias in the pay system.

D. Financial implications

The are as follows:
 

E. Legal Implications

The failure by the MPA to properly identify, investigate and remedy any differences in pay which cannot be justified on the grounds of a genuine material factor could give rise to equal pay claims and reputational risk. By implementing the recommendations contained in the Equal Pay Audit, and by monitoring and reviewing equal pay on an ongoing basis, the Authority can ensure that its practices are kept up to date and legally compliant.

F. Background papers

• Co-ordination of Policing Committee – MPA Staff Equal Pay Audit
  Published June 2007
• Hay Equal Pay Audit 2007 – Analysis of trends and policies
  Published October 2007

F. Contact details

Report author: Michael Shurety, Interim Head of Human Resources, MPA

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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