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Gender pay gap report 2021

Read the latest report

Foreword from Sian Evans, Director of Human Resources

Our gender pay gap for 2021 continues to be significantly lower than most organisations in the UK, and overwhelmingly lower than organisations operating in the same sector. We made progress on narrowing – or eliminating – the pay gap on some measures.

Following three years of small gaps, our median pay is at parity for the first time and the mean pay gap has continued to fall. Median bonus remains at parity.

While this is pleasing, the mean bonus gap has increased and the proportion of women receiving a bonus has fallen below men. This is largely because we had more recent female recruits (not eligible for bonus) than men, and more women than men working part-time with pro-rated bonus values, during this reporting period.

We have previously noted that it’s likely that our gender pay gap will fluctuate up as well as down over time, and these two measures are examples of where this is the case. We will continue to monitor our gender pay gap over time and take action to meet our ultimate commitment of a zero gender pay gap.

Gender pay does not compare the pay and bonus for equivalent roles and is therefore distinct from Equal Pay for Work of Equivalent Value. We are confident that we have equal pay.

I confirm that our gender pay gap calculations are accurate and meet the requirements of the Regulations. The data has been produced in accordance with guidance from the Government Equalities Office, published on14 December 2020 and last updated on 23 February 2021.

Sian Evans
Director of Human Resources

StepChange Gender Pay Gap report for the year ending 5 April 2021

For 2021, key outcomes resulting from our gender pay analysis are:

  • Our median pay is at parity; women’s hourly pay is equal to that of men
  • Median and mean gender pay gaps for pay and bonus have reduced slightly compared with 2020
  • Our median bonus rate is at parity; the median bonus for women is equal to that of men
  • The mean bonus gap has increased and the proportion of women receiving a bonus is lower than for men; this is largely because we had more recent female recruits (not eligible for bonus) than men

Full details and commentary regarding pay and bonus are provided in the following report.

Background

Since April 2017, employers with 250 or more colleagues have been required by law to publish the pay gap between men and women.

The gender pay gap is the difference between the average earnings of all the men and women working in an organisation, irrespective of their role or seniority. As such, it provides a broad indication of how well organisations are seeking to achieve gender equality.

Gender pay is distinct from equal pay, which is the legal requirement that men and women in the same employment performing equal work must receive equal pay. We are confident that we have equal pay.

In line with the gender pay gap legislation, the pay gap and pay quartiles information is based on payments made through payroll in April 2021. The bonus information reflects payments received during the 12 months from 6th April 2020 to 5th April 2021.

Pay gap

The following table summarises our gender pay gap based on the April 2021 payroll for 1,498 relevant colleagues within the charity. The charity’s relevant headcount has increased from 1,409 in 2020.

For comparison, we have included the average figures for the UK and for those organisations classified as providing the same type of economic activity as StepChange (Financial intermediation). Note that the UK and sector equivalent figures for 2021 are not yet available; we will update this document when they are published.

2021 mean and median pay gap with 2020 for comparison

In comparison with men at StepChange:

Timing Women’s mean hourly rate is Women’s median hourly rate is
2021 7.2% lower 0.0% lower

2020 7.4% lower

UK average 14% lower
Financial intermediation average 27.8% lower
0.2% lower

UK average 12.6% lower
Financial intermediation average 25% lower

  • Our pay gap continues to be smaller than most other organisations and significantly below those with a similar focus.
  • Our median pay is almost equal for men and women, and the mean pay gap has decreased.

The year-on-year decrease in the gender pay gap is largely a consequence of the increase in female representation in the highest pay quartile. The gap in mean pay is due to the distribution of men and women across the pay quartiles, documented in the following section.

We continue to believe that this year’s small decreases reflect the natural variations resulting from running the charity. The gender pay calculation is a snapshot of pay at a point in time and ongoing recruitment activity will see the gender pay gap fluctuate, both up and down, over time.

Pay quartiles

Overall, of the 1,498 colleagues included in this analysis, 55% are female and 45% are male. This represents a small increase in the proportion of female colleagues, from 53% in 2020, but is still a reasonably balanced population and broadly reflects the UK’s overall gender split (51% female and 49% male).

As in previous years, the proportion of women is higher in all quartiles except the highest quartile where the proportion of men is 52%, down from 55% in 2020.

2021 gender proportions by pay quartile (change from 2020 in brackets)

Graph showing 2021 gender proportions by pay quartile. Women accounted for 48% - highest quartile, 53% - middle quartile, 57% lower middle quartile and 61% - lowest quartile

Bonus gap

All colleagues were eligible for an annual bonus during 2020 if they met pre-defined criteria. The annual bonus was paid in February 2021 to all eligible colleagues who had completed their probation period before the end of 2020.

In addition, the charity honours the memory of its first Chief Executive through the Iain Kendall Memorial Awards, recognising colleagues who have truly demonstrated our values and gone above and beyond in their roles here at StepChange. 25 colleagues received a quarterly payment during the year to April 2021.

Our bonus gap for the 12 months ending April 2021 is set out in the following table. For comparison, we have included the average figures for the UK and for those organisations classified as providing the same type of economic activity as StepChange (Financial intermediation). Note that the UK and sector equivalent figures for 2021 are not yet available; we will update this document when they are published.

2021 mean and median bonus pay gap with 2020 for comparison

In comparison with men at StepChange:

Timing Women’s mean bonus is Women’s median bonus is
2021 8.8% lower 0.0% lower

2020 2.4% lower

UK average 14.9% lower
Financial intermediation average 46.3% lower
0.0% lower

UK average 2.6% lower
Financial intermediation average 46% lower

  • Our median gap in bonus payments between men and women continues to be zero, while the mean gap has increased since 2020.

Commentary

The bonus approach for 2021 was the same as for 2020, with annual bonus payments pro-rated, based on colleague service and working hours.

As for 2020, the annual bonus paid in 2021 varies based on colleague ratings for performance and behaviours. A ‘standard’ bonus was paid for colleagues rated ‘expected’. Colleagues with the higher ratings of ‘outperforming’ and ‘exceptional’ received an increased bonus. A zero bonus resulted for those colleagues with the lower ratings of ‘developing’ and ‘underperforming’.

While the profile of service, working hours and ratings varies from year to year, the median bonus gap has remained at zero. This is a consequence of the largest proportion of colleagues, around one third of the population, receiving a standard bonus.

The mean bonus gap has increased from 2.4% for 2020 to 8.8% for 2021 but remains well below the 2019 level of 24.0%. This increase is largely a result of recruitment activity during 2020; more women joined the charity than men, meaning that:

  • A slightly higher proportion of women than men received zero bonus because they had yet to complete probation; 15% of women compared with 12% of men.
  • A higher proportion of women than men had their bonus pro-rated to reflect service and/or working hours; 28% of women compared with 12% of men.

This illustrates our observation that, as the gender pay calculations are a snapshot of pay at a point in time, factors such as ongoing recruitment activity will see the gender pay gap fluctuate, both up and down, over time.

Proportion of colleagues receiving a bonus

A higher proportion our colleagues received a bonus during the year to April 2021 compared with 2020. Unlike previous years, the gap regarding the proportion of men and women who received a bonus now favours men:

2021 proportion of women and men receiving a bonus with 2020 for comparison

Graph showing 2021 proportion of women and men receiving a bonus with 2020 for comparison. 80.6% of women received a bonus, 82.4% of men

The increase in the overall proportion of colleagues receiving a bonus compared with 2020 reflects the reduction in the proportion of recent joiners who had yet to complete probation and were not eligible to receive a bonus. Around 15% of colleagues were ineligible on this basis, compared with 20% in 2020. A further 5% of colleagues received a zero bonus based on their ratings.

These criteria also explain the difference between the proportions of men and women receiving a bonus; the annual bonus was paid to all eligible colleagues who had completed their probation period and were rated as ‘expected’ or above. A slightly higher proportion of women than men received zero bonus because they had yet to complete probation; 15% of women compared with 12% of men. The 5% of colleagues who received a zero bonus based on their ratings was evenly split between women and men.

As a result, a greater proportion of men than women received a bonus payment.