Creating a fairer Britain
This toolkit is a guide to good equal pay practice for small firms. It aims to help small businesses to understand their obligations under the provisions of the Equality Act that relate to equal pay and provides step-by-step advice to enable them to check whether they provide equal pay in practice.
The toolkit is intended for businesses with up to 50 employees. If you employ more than 50 people you may find the equal pay audit kit for larger employers more appropriate.
'Equal pay' means ensuring that what you pay your employees is not affected, even unintentionally, by factors such as their sex, their race, or whether they have a disability. The provisions of the Equality Act on equal pay (or equality of terms) specifically cover the pay of men and women, and traditionally, most equal pay audits have focused on gender. However, paying employees differently because of their ethnicity or disability will be unlawful under the race and disability provisions of the Act. The law says that you should provide equal pay when your employees are doing equal work. (See Understanding equal pay and equal work in STEP 1) This toolkit explains how you can check which of your employees are doing equal work.
Equal pay is good for business. It will help attract the best people and ensure their full motivation and commitment to the success of your business. It will help minimise unwanted labour turnover with all its disruption and cost. And unequal pay linked to sex, race or disability may be unlawful. If you want to know more about the Equality Act see the Equality Act section.
This toolkit gives general guidance only and should not be regarded as a complete or authoritative statement of the law. Readers should be alert to the possibility of developments in case law that may affect the rights of employees.
The toolkit is intended to be used as a living document, which may be added to, or taken away from, depending on current legislative changes, case law and user experience. If you have any comments on the kit please email Michelle.Gyimah@equalityhumanrights.com.
Conducting an equal pay audit is also an opportunity for you to consider whether pay is fair in your business. For more information on fair pay systems see the Acas website, where advisory booklets on pay systems and job evaluation are available to order.
There are five steps in the toolkit:
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