No discrimination in compensation
Avoiding a gender bias in pay is central to our ambition for fair compensation.
Discrimination of all kinds holds back individuals and our business – and it has no place in the culture we want to create in Unilever.
Equal pay for equal work
We have a longstanding commitment to equal pay for equal work, which is one of five principles of our Framework for Fair Compensation (PDF | 449KB).
It’s a key part of our commitment to developing an inclusive culture and respecting the contribution of all employees regardless of gender, age, race, disability or sexual orientation.
Our compensation structures are intended to be gender neutral, with any pay differences between employees in similar jobs fairly reflecting levels of individual performance and skill.
We review our pay structures in each country annually as part of our Framework’s compliance process. If our analysis indicates any average pay differences between genders at a country or grade level (a ‘gender pay gap’), we will support and identify opportunities to address gaps via our diversity and inclusion initiatives. This will help us achieve our ambition for our Framework for Fair Compensation to support full equal opportunities for all.
We also cascade the principles of our Framework to our suppliers through our Responsible Sourcing Policy (PDF | 5MB). Its Fundamental Principle 3 requires that “all workers are treated equally and with respect and dignity”, which includes compensation. See Advancing human rights in our extended supply chain. Our Responsible Business Partner Policy (PDF | 8MB) sets out the employment terms we expect our network of distributors and sales agents to adopt, including no discrimination.
What is a gender pay gap?
The gender pay gap is the average difference in pay between men and women, measured at a company level within a country. It’s explained through various statistics and is influenced by a range of factors, including the demographics of a company’s workforce.
Our analysis of the average pay gap between women and men – at a country level and at job grade level – helps us identify any areas of gender representation imbalance, such as in the types of jobs held by women compared to men. We use this information to focus on where we can create more balanced gender representation.
Explaining gender pay gaps: the importance of demographics
As an illustration of how the proportion of women in the workforce can vary across job levels, our analysis shows that in countries with more than 250 employees, our overall female representation was 36% in 2019, (2018: 35%). And across Unilever at management level, we reached 51% (50.7%) women in 2019. However, at what we call Work Level 1 (our non-management ‘white collar’ grade) women made up 48% of our employee population, whereas for Work Level 1 ‘blue collar’ the figure was 21%.
Our analysis of gender pay gap highlights a broad trend: a lower pay gap in those countries with a larger female Unilever workforce.
How balanced the workforce is at each work level also has a significant impact on average pay differences. Average gender pay gap analysis therefore needs to be viewed in the context of a country’s workforce gender demographics.
What’s our gender pay gap?
When we look at our worldwide business as a whole, in countries with more than 250 employees, the average female pay was 22% higher than male pay in 2019 (2018: 26%, 2017: 25%).
This is largely due to the fact that 79% (2018: 80%) of our lower paying blue-collar roles are held by male employees.
Analysing our gender pay gaps
Our Framework for Fair Compensation reviews the average pay differences between genders at each work level and in each country. Our most recent analysis from 2019 highlights that there’s more work to do to continue improving our gender balance, and related gender pay gaps, at various levels and in various countries throughout the business.
UK gender pay report
In line with the UK Government’s new Gender Pay Gap regulations, we published the first gender pay results for our UK business in 2017.
Our next report in 2018 showed that at Unilever in the UK, the median hourly pay for women was 3.3% more than men. In 2019, our analysis (PDF | 3MB) showed that the median hourly pay for women was 2.7% more than men. While our median pay figures remain in favour of women, our mean pay figures are in favour of men. This reflects both how the different averages are calculated, and the shape of our workforce.
Mean figures represent the average across our whole workforce, so are particularly impacted by the highest earners in our UK business – generally senior management roles, more of which are held by men.
Median figures represent the midpoint of our workforce and so are higher for women, reflecting the fact that more of our manufacturing roles are held by men, with more women in managerial roles in this area of the business.
Sebastian Munden, General Manager, Unilever UK and Ireland commented: “We made further progress in 2019 towards closing our pay gaps, however, we know we need to do more to improve representation in some parts of our business. We achieved gender equality at managerial level a few years ago, but we must maintain momentum and achieve equal progression opportunities for all."
In 2019 in Pakistan, the proportion of women in our workforce increased to 11%, up from 10% in 2018. This was mainly due to hiring more women at Work Levels 2 and 3 (our junior to middle management grades).
When we looked at base pay (ie fixed pay) for our workforce overall in Pakistan, we found that on average women earned more than men, despite being a smaller proportion of our workforce. And while there was a decrease of 6% in average female base pay versus average male base pay compared to 2018, average female pay remained 72% higher than average male pay in 2019.
In Nigeria, female representation in our workforce was 20% in 2019, the same as in 2018. However, this static figure masks the complexities of gender pay gaps for two reasons:
- firstly, in 2019 we upped our recruitment of women at Work Level 4 (our senior management grade) by around 17%, and
- secondly, the proportion of women in Work Level 2 (our junior management grade) decreased slightly by around 4%.
So while women in the workforce remained stable at 20%, the components of this figure have shifted.
This shift in the workforce in turn affected female base pay in Nigeria. Overall, average female base pay was 121% higher than male pay in 2019. This figure dropped from 145% in 2018, mainly due to the fact that we hired more male employees at our Work Level 3 (middle management) grade which influenced the average base pay.
Gender pay gaps versus equal pay
The difference between gender pay gap & equal pay
Andrew Forsythe, Global Reward Director in our HR function, explains that gender pay gap is not a measure of equal pay.
“Equal pay is about ensuring there’s no pay difference between genders doing the same job. The gender pay gap is the average pay difference between genders at a company level within a country.
This is an important distinction.
Just because a gender pay gap exists at a company level, it doesn’t mean that female employees are paid less than male employees at a grade or individual job level. The gender pay gap simply shows that the company average pay is different between the genders.
There can be all sorts of reasons for this. Even if a company has a rigorously applied equal pay reward practice, there could be a company-level gender pay gap showing the average female salary is lower than the average male, or vice versa. This could be due to gender demographics – so it’s crucial to understand this bigger picture across the business. That’s the job of our team.”