PRH first publisher to reveal disability, sexual orientation and socio-economic pay gaps

Penguin Random House (PRH) has become the first UK publisher to share its pay gaps for disability, sexual orientation and socio-economic background, alongside those for gender and ethnicity.

Val Garside, HR director (pictured), said the publisher made the decision to release this additional data because it is “fundamental” to helping it understand and measure the progress towards its diversity and inclusion goals, helping to identify where to take further action. 

The disability pay gap figures showed the biggest disparity, although there were also sizeable differences in pay in sexual orientation and socio-economic background.

The new report on the disability pay gap showed a mean hourly pay gap of 21.6% and median gap of 20.8%. The data is based on 51.9% of the workforce self-reporting whether they have a disability or not. Median figures are calculated by ranking all employees from highest to lowest-paid, and taking the hourly wage of the person in the middle, while the mean is the average hourly wage across the entire organisation. 

This was the largest pay gap in the report and PRH said this was because the distribution of disabled staff is more uneven than in the other demographic groups reported, with more than three times as many disabled staff in the lower quartile (25.2%) than the upper quartile (7.5%).  

To help address this the publisher joined the government’s Disability Confident scheme in August, which includes a commitment to offer disabled job applicants an interview if they meet the essential requirements for the role.  

The sexual orientation pay gap looks at the difference in average earnings between colleagues who identify as lesbian, gay, bisexual or another term, and those who identify as heterosexual/straight. In 2021, PRH's mean sexual orientation pay gap was 12.2%, and median gap was 9.9%. The data is based on 52.2% of our workforce self-reporting their sexual orientation. 

The mean socio-economic pay gap, between employees from lower socio-economic backgrounds versus those from higher socio-economic backgrounds, was 16.3%, and median gap was 10%. The data is based on 42.9% of the workforce self-reporting their socio-economic background. PRH used the measure of parental occupation as an indicator of socio-economic background.  

This year the publisher has seen its gender pay gaps slightly decrease from a “disappointing” report in 2020, but the figures are still higher than in 2019. There has also been some small rises in the bonus gap figures. The publisher stressed pay gap figures can increase in the short term as work to improve diversity and representation takes time to bed in and for people to rise up the ranks into higher earning roles.  

The ethnicity pay gaps have also seen a slight decrease this year. While the data on disability, sexual orientation and socio-economic background is brand new for this year, the publisher acknowledged it “illustrates clearly the lack of representation for all groups at senior levels of the organisation” and stressed that PRH needs to do more to improve representation across the company, particularly at senior level. 

In 2021, the mean gender pay gap for hourly pay, based on snapshot payroll data from April, reduced by 2.9% to 10.4% compared to 13.3% in 2020. The mean gender pay gap in 2019 was 9.1%. The median gap also reduced to 3.6% from 5.3% last year. However, this was also slightly up on 2019’s 3.2%.  

Garside said the pay gap was down to there being fewer men in entry level and early career roles. The firm’s 16-strong leadership team continues to have equal gender representation, while its top 100 earners is made up of 51% women and 49% men. However, in its publishing and group departments, women outnumber men in lower quartiles, particularly entry-level roles, affecting the figures. 

Likewise, more men work in the technology team, which attracts a higher salary in the market compared to other roles specific to the publishing sector. Although women occupy roles at all levels in the department, men make up the majority (73%), so this high proportion of men has a significant impact on the firm's pay gap.  

The publisher said its pay gap has reduced since 2020 because of changes to the make-up of its pay quartiles. There was an increase in the proportion of women in the upper and upper-middle quartiles, making up 59.1% and 68.9% respectively, compared to 57.2% and 67.9% last year. However, there was also an increase in the proportion of women in the lowest pay bracket, up to 61.1% up from 54.3% last year.  

The mean hourly gender bonus gap rose to 35.9% this year compared to 34.5% in 2020. The median was also up to 6.3% compared to 3.7% the year before. PRH said this was due to an increase in the number of men in the lower-middle quartile, together with a decrease in the number of men in the lower quartile. “These shifts mean more men earning higher salaries and therefore higher bonuses than in the previous reporting period, resulting in a slight increase in the bonus gap,” PRH said.  

Breaking down the firm's two employing entities, figures show the Random House Group median gender pay gap is now 2.5% compared to 0.9% last year, with the mean figure coming in at 9.4% down from 11.8% . At Penguin Books Ltd and DK the median gender pay gap is down to 11.9% from 13.5%. The mean figure shrank to 20.3% from 23.2% 

Last year PRH published its first ever ethnicity pay gap report, measuring the difference in pay between white employees and Black, Asian and minority ethnic staff. This year’s results show a slight decrease in the hourly pay gaps. This year’s mean ethnicity pay gap reduced by 0.9% to 15.1% while the median ethnicity pay gap has also reduced by 2.6% to 1.1% 

The data is based on 53.8% of the workforce who voluntarily disclosed their ethnicity in PRH’s 2020 inclusion survey. The publisher said it recognised this limited the accuracy of the report. It also ackowledged that "categorising colleagues in this way poses a number of challenges" for example, inaccurately suggesting "that colleagues have the same experiences or level of representation". The publisher also included a further breakdown of the ethnicity pay and bonus gap for staff who identify as Asian or Asian British, Black or Black British, mixed ethnicity, and for staff who identify as a different ethnicity to these. 

It said the ethnicity pay gap was because there are fewer Black, Asian and minority ethnic staff in senior roles than in early and mid-level roles, and that the reduction in the pay gap since 2020 is a result of changes to the make-up of pay quartiles, which has seen an increase in the proportion of Black, Asian and minority staff in the lower-middle quartile, and a decrease in the lower one. 

To narrow the pay gaps further, PRH has introduced a new recruitment and promotion policy to drive more inclusive practices. This includes a diversity slate, which means the publisher “will make every effort” to ensure every interview includes two qualified underrepresented candidates. The publisher will focus on women for technology, and underrepresented ethnicities for all other vacancies. PRH also has transparent salary bands for all roles including on job adverts and is working to improve the way it uses data better to understand pay gaps, track progress and identify priority actions. 

PRH will undertake its next annual inclusion survey in quarter four this year. The publisher said it hopes even more employees will choose to disclose their data “as they understand more about how sharing their data can help drive specific actions to achieve a representative workforce”. 

The report added: "If we can achieve higher voluntary disclosure this will increase the accuracy of the report. At the same time, it’s also worth noting that increased or varied participation in future years may mean that year-on-year comparisons are difficult to make."