The Tesco Pay Claim and Equal Pay: Perception vs. Reality
The Tesco Pay Claim and Equal Pay: Perception vs. Reality

The Tesco Pay Claim and Equal Pay: Perception vs. Reality

The Tesco Pay Claim is taking the internet by storm, with emotive headlines about gender equality, but what is it really about?

Equal pay for work of equal worth

Tesco has said that all their staff are provided with opportunities to progress equally and were paid fairly, whatever their gender or background. Their current pay gap is 8.6% which is below the average of 18.1%.

Since both the Equal Pay act 1970 and Equality act 2010 were put in place it is unlawful to pay men and women unequally. So why is it that in 2017 men were still earning over 18% more than women in the UK? This along with the reports of men earning 5% more in bonuses per year than women. There has been a slight shift in women gaining higher positions in firms, but this is still not comparable to the amount of men in similar roles.

However, it now appears that the question surrounding the recent claim of Tesco underpaying it’s staff may be more about comparable roles than gender pay? (although it is clear that gender pay is still not equal even within Tesco).

As workers doing jobs that require comparable skills, and therefore have similar levels of responsibility, they are arguably of comparable worth to the employer, and therefore should be rewarded equally as a result. So, in the case for Tesco it is argued that shop floor workers and warehouse workers should have matching pay, regardless of gender. As the roles are seemingly comparable, they are also of equal worth to the company with equal value to the overall profits made by Tesco.

As an apparent bias has allowed for a pay disparity spanning many years, up to 200,000 supermarket workers are reported to be affected by this claim, the majority of which are women. This is undoubtedly going to be a lengthy legal process which could last several years, so far initial claims have been lodged with ACAS.

With the claim of £4bn, more than four times’ Tesco profit for last year, the overall question of concern is possible bankruptcy as even if a small number of the women claiming against Tesco are successful, the total loss for Tesco would be significant as a result.

With companies who have over 250 employees having to publish gender pay gap data by 2018, perhaps this case, while unfortunate for Tesco, will show other firms that no matter how big or small the company is, the importance of gender equal pay along with comparable pay. In which hopefully the outcome will be to reduce both the comparable and gender pay gaps.

Perception vs reality

Despite the emotive headlines, all may not be as it seems.

Job evaluation is the standard method used by large companies in any equal pay claim to help systematically determine the relative importance of different jobs. Job evaluation provides an unbiased assessment of roles, from comparing two employees in different grades to, in the case of Tesco over 2,000 workers being paid different wages.

As a society, we have historically placed strong stereotypes on roles and gender, where in the past we would associate physics and maths for example, as being predominantly male roles. The influence of the media and changing dynamics within businesses has gone a long way towards changing this perception. Job evaluation provides a hierarchy of jobs that is free from discrimination, despite not mirroring everyone’s perceptions.

The agreed criteria looks at characteristics including skills, responsibility, working conditions and effort. Each factor must be weighed according to its relative importance to the organisation. Points are then awarded to a job according to the level it is allocated in each characteristic. The total amount of points then establishes where the job fits in the hierarchy, which can then be compared to other roles.

Arguably, in this case the current evaluation by workers and their associated legal teams, appears to be based purely on their perception of work comparability rather than a detailed evaluation which is now likely to follow. The outcome remains to be seen but will be costly for Tesco either way as months if not years of legal wrangling lies ahead.

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