{"id":3855,"date":"2021-05-28T15:29:08","date_gmt":"2021-05-28T14:29:08","guid":{"rendered":"https:\/\/marriott-stats.com\/nigels-blog\/?p=3855"},"modified":"2021-06-10T22:01:00","modified_gmt":"2021-06-10T21:01:00","slug":"ryanair-gender-pay-gap-report-is-the-best","status":"publish","type":"post","link":"https:\/\/marriott-stats.com\/nigels-blog\/ryanair-gender-pay-gap-report-is-the-best\/","title":{"rendered":"Pay Gap Case Study #5 – Why Ryanair’s pay gap report is my favourite"},"content":{"rendered":"

Ryanair has the largest (verified) gender pay gap of any employer in the UK<\/a>, they didn’t bother to report their 2019 pay gap, they are leaving their 2020 pay gap reporting to the last minute, it’s pay gap narrative is only 1 page<\/a>, they incorrectly use pie charts to represent the pay gap and they have a dodgy bar chart the Liberal Democrats<\/a> would be proud of!\u00a0 But apart from all that, Ryanair’s gender pay gap report is a shining example that all other employers could learn from.\u00a0 Out of the hundred plus pay gap narratives I have read so far, Ryanair’s is my favourite.<\/p>\n

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Why I write these case studies<\/strong><\/span><\/h5>\n

My case studies explore good and bad practice with gender pay gap analysis and highlights what can be learned from them.\u00a0 Closing a national pay gap can only happen if change happens within individual employers in the first place.\u00a0 In the front line of such change will be the HR department who in my experience find basic statistics a struggle and so I hope they find these case studies illuminating.<\/p>\n

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  1. “Life on Mars<\/a><\/em><\/strong>“, – I work out how much variation in gender pay gaps can be expected by chance.\u00a0 I then show that the variation in pay gaps across the 4 UK subsidiaries of my former employer Mars UK<\/strong><\/span> was within the bounds of chance and that in effect they had no gender pay gap.\u00a0 Based on my experience of working there, I explored some of the reasons why Mars did not have a pay gap.<\/li>\n
  2. “The good, the bad and the Unilever<\/a><\/em><\/strong>“.\u00a0 I looked at the two legal entities of Unilever<\/strong><\/span> who are required to report their gender pay gap and noticed that the year on year changes between 2017 & 2018 looked odd.\u00a0 I used them as an inspiration to explain how one can spot if year on year changes are plausible or not.<\/li>\n
  3. The effect of Samira Ahmed winning her equal pay claim against the<\/a> BBC <\/span><\/strong>and what impact it would have on their gender pay gap.\u00a0 Confusion abounds over the difference between unequal pay and gender pay gaps and I showed that the impact of Samira winning the case could be to widen the pay gap instead.<\/li>\n
  4. “What is the gender pay gap at Novartis UK<\/a><\/strong><\/em>“.\u00a0 Novartis<\/strong><\/span> perfectly illustrate the hazard of Simpson’s paradox when analysing pay gaps where employees simultaneously work for an employer with a gender pay gap favouring women and a gender pay gap favouring men.<\/li>\n<\/ol>\n

    In this case study, I explore the purpose of an employer’s pay gap report and show how Ryanair mostly fulfill this purpose in less than half a page.<\/p>\n

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    Ryanair’s gender pay gap in 2017 & 2018<\/strong><\/span><\/h5>\n

    In 2018, the median woman at Ryanair Ltd earned 36p<\/a> for every \u00a31 earned by the median man, an improvement on 2017 when the median woman earned 28p<\/a>. \"\"As far as I can tell, Ryanair has the largest verified gender pay gap of any employer in the UK.\u00a0 By verified, I mean that the published pay gap looks to be correct.<\/p>\n

    There are 20 or so employers with supposedly larger pay gaps but all of these are either all-male companies which forces them to enter 0p for the median woman or the employer has clearly or very probably made a mistake.\u00a0 For example, the Royal Hospital School in 2019 reported the median woman earns 25p<\/a> for every \u00a31 earned by the median man but when you read their report you find that the median woman earns 25p less<\/strong><\/span> than the median man (assuming he earns \u00a31).<\/p>\n

    The graphic here for Ryanair shows the large pay gap must be due to there being no women in the top hourly pay quarter and less than 20% in the upper middle pay quarter.\u00a0 On the other side, women make up the majority of employees in the lower pay quartiles.<\/p>\n

    So what do Ryanair have to say about their gender pay gap in their report?\u00a0 I will start with what’s bad about their report, what I think is good and finish with recommendations for improvement.\u00a0 Both the 2017<\/a> & 2018<\/a> reports used the same 1 page downloadable PDF format and I will concentrate here on the 2018 report<\/a>.<\/p>\n

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    Ryanair’s 2018 Report – The Terrible<\/strong><\/span><\/h5>\n

    Here is a shot of the bottom half of the 1-page PDF download which displays the numbers Ryanair are required to calculate and report by law.<\/p>\n

    \"\"<\/p>\n

    The crimes against good data visualisation that Ryanair are guilty of are :-<\/p>\n

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    1. Using a pie chart to denote hourly pay & bonus pay gaps<\/strong><\/span>.\u00a0 They are not alone in doing this but it should be obvious to anyone that pie charts cannot be used when the % scale can be negative or greater than 100%.\u00a0 The mandatory calculation of a pay gap (which I dislike, see point 1 of this link<\/a>) means that a pay gap favouring men has to be a positive number between 0% & 100% but a pay gap favouring women is a negative % which can and does exceed -100% and can in theory be minus infinity.\u00a0 A second issue with pie charts is that most people associate 100% as being “good” but for pay gaps, it is 0% that is “good”.<\/li>\n
    2. Using pie charts to denote % of men & women receiving bonuses<\/strong><\/span>.\u00a0 Pie charts represent proportions of a total so the use of \"\"the pie charts here is not necessarily wrong.\u00a0 However, statisticians rarely use pie charts especially when the goal is to compare<\/strong> proportions i.e. how big a difference is there between men and women.\u00a0 The simplest way to do this is to have 2 bars side by side on a 0 to 100% scale as shown here.<\/li>\n
    3. It’s Pay Quarters not Quartile Bands<\/span>.<\/strong>\u00a0 The bottom right hand chart above is a proper layout for this kind of data since you are comparing pay quarters.\u00a0 Of course, Ryanair is incorrectly calling these quartiles instead of quarters but in their defence, Parliament made the same mistake in the 2010 Equality Act.\u00a0 Quartiles are of course the boundaries between quarters.\u00a0 Unlike their other 3 charts, no explanation is given of this chart and you have to know what it is representing.<\/li>\n
    4. Using pie charts in the first place<\/span>.<\/strong>\u00a0 In my 30+ years experience of working with non-statisticians from many industries and all business functions, I have found when someone defaults to a pie chart, more often than not that is a clue that the person who did the chart didn’t understand what they were doing.\u00a0 Again Ryanair will not be alone in doing this.<\/li>\n<\/ol>\n

      I finish the Terrible by noting that the 2018 report is their latest.\u00a0 Ryanair never bothered to submit 2019 data and they have yet to publish 2020 data.<\/p>\n

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      Ryanair’s 2018 Report – The Outstanding<\/strong><\/span><\/h5>\n

      Here is the top half of the 1-pager which I think is brilliant.<\/p>\n

      \"\"<\/p>\n

      What is the purpose of an employer’s pay gap report?\u00a0 For me, it is the employer’s chance to explain and own the following narratives –<\/p>\n

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      1. How they operate today<\/strong><\/span><\/li>\n
      2. Why they have a pay gap today<\/strong><\/span><\/li>\n
      3. What plans they have to address this<\/strong><\/span><\/li>\n
      4. What barriers\/constraints have to be overcome to make progress<\/strong><\/span><\/li>\n
      5. What is a realistic timetable for progress within the current framework of employment law<\/strong><\/span><\/li>\n
      6. What has worked so far in closing their pay gap<\/strong><\/span><\/li>\n<\/ol>\n

        How well does Ryanair’s half pager capture the 6 narratives?<\/p>\n

        1. How they operate today<\/strong><\/span> – The gender pay gap regulations only applies to employees who come under UK employment law.\u00a0 Ryanair is an Irish airline with operations in many countries.\u00a0 In the very first paragraph, they state the only employees to come under the regulations are pilots and cabin crew based in the UK.\u00a0 They point out that their head office and administrative operations are based in Ireland.<\/p>\n

        Suppose that first paragraph had been the entire report, would you now expect a pay gap at Ryanair UK?\u00a0 Of course you would!\u00a0 How many pilots have you heard making announcements on flights you’ve taken have been female?\u00a0 How many of the cabin crew that have served you have been male?\u00a0 Do pilots earn more than cabin crew?\u00a0 Of course they do but are you bothered by that?\u00a0 Probably not, since the pilots bear the greatest responsibility for your safety.<\/p>\n

        So in pointing out how they operate, they immediately give you information that pretty much tells you they will have a pay gap, what the reasons are for this and that changing this is going to take some time.\u00a0 Ryanair’s economy and efficiency in conveying what you need to know is excellent.<\/p>\n

        2. Why they have a pay gap today<\/strong>\u00a0<\/span>– We already expect them to have a pay gap following the first paragraph but they follow up with a few numbers that tell the entire story even better.<\/p>\n

        \"\"<\/p>\n

        This is the winning bit for me that renders the terrible bottom half irrelevant and makes their report outstanding.\u00a0 Yes, there is a dodgy bar chart (689 v 15?!?) that the Liberal Democrats would be proud of (google “Lib Dem bar charts<\/em><\/span>” for some fun!) but the numbers are the important bits here.<\/p>\n

        Ryanair give us a succinct set of raw numbers that tell me the following.<\/p>\n