Testerworld Limited; Gender Pay Gap Reporting Statement April 2019

In accordance with the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, Testerworld Ltd hereby presents its gender pay gap figures for workers in scope at the snapshot date of 5 April 2019.

Testerworld Limited, (trading as the DE Group in England, Wales and Northern Ireland), is one of the UK’s leading independent pharmaceutical wholesalers. Our main activity is the distribution of prescription pharmaceuticals to over 4,000 independent community pharmacies from 8 strategically based distribution locations. The DE Group is a trading entity, and the principle employer within the Converse Pharma Group.

Background

All companies with 250 or more employees are now required to publish their gender pay gap under new legislation that came into force in April 2017. Employers have to publish the gap in pay between men and women on both a median basis (pay per hour based on the person ‘in the middle’ of the distribution of pay) and a mean basis (average hourly salary). In addition, employers are required to disclose the distribution of gender by pay quartile – in other words splitting the workforce into four groups based on their pay, and showing the proportion of men and women in each group. Employers are also required to disclose percentages of staff receiving bonuses by gender and the gender gap on bonuses.

Gender Pay Gap Vs Equal pay.

This gender based pay analysis is significantly different to, and not be confused with equal pay. UK law has since the 1970s prohibited the paying of different amounts to men and women for doing “work of equal value”, i.e. the same job. This gender pay-gap analysis takes into account all jobs within the business, and analyses the difference between the average mean or median hourly earnings of male employees and female employees, expressed as a percentage of the average hourly pay of male employees. This means that a positive number indicates men earn more than women; a negative number will mean the reverse.

Median: The middle most salary.  Line all salaries up from highest to lowest and the median is the salary in the middle.

Mean; The overall average. E.g add up the salaries of all male employees and divide by the number of male employees in the company to get an average or “mean”, male hourly pay rate.

Understanding the results; A positive number would indicate that male employees earn relatively more than female employees, a negative number would indicate that female employees earn relatively more.  

National average; The national gender pay gap as published by the office of national statistics 2019, was +17.3%. i.e on average men earn 17.3% more than women.

Gender pay gap results

Mean                        Median

-5.7%                        -0%

Gender pay gap bonus Results

Mean          Median

44.0%         18.3%

Proportion of Males and Females Receiving a Bonus

Male           Female

11.2%         36.5%

Gender Pay Gap; Statement.

Testerworld’s gender pay gap at 31st March 2019 as presented on a mean basis is -5.7%.

i.e The average hourly pay of our female employees is 5.7% higher than the average hourly rate of our male employees. This figure represents a significant variation from the +17.3% national average. The 2019 figure shows a narrowing of the overall pay gap from the position recorded in 2018 (-14.7%).  The breakdown of gender prolife by pay quartile does help to provide a rationale and understanding behind this headline number.  The profile of roles within the organisation can be broadly split into four “groups”; warehouse operatives, distribution (driving) personnel, commercial employees (buying and sales) and managerial roles.

Numerically the highest proportion of roles occur within the warehouse and distribution functions. These roles are predominantly situated in the lower two pay quartiles. Over the past 12 months we have experienced a significant increase in the relative female representation in these quartiles; illustrated by an increase in female participation in the lower quartile from 25.6% to 53.3%.

In addition to this significant change we have also seen an increase in the proportion of male employees in the upper middle quartile. These two factors have combined to narrow the gender pay gap from the prior year.   We are comfortable that an equal opportunity, gender-neutral approach to recruitment within these quartiles remains in place.     

Whilst the proportion of female employees in the upper middle quartile reduced during the year, the percentage of females in the upper quartile increased slightly on the prior year, with over 62% of roles being undertaken by female employees during the year. As indicated previously, the roles within the upper two quartiles are predominantly commercial and managerial functions. Again, we are comfortable that an equal opportunity, gender-neutral approach to recruitment within the upper quartiles is in place. We cannot identify any numerical gender bias towards females in the recruitment process in the upper quartile, nor males in the upper middle quartile. Following analysis, we do believe that the predominance of female employees in the upper quartile, and males in the upper middle quartile is a fair reflection of the quality of applicants for each role, and that appointments are not influenced by any gender bias. 

The higher proportion of female employees in the commercially driven upper quartile roles, such as the  sales function, helps us to understand the reason behind the relatively high proportion of female employees who are in roles that attract a bonus payment, 36.5%, compared to 11.2% of male employees. This relative disparity has reduced slightly on the prior year when 38.7% of female employees received a bonus.  We are comfortable that the underlying rationale behind the disparity is outlined above and is consistent with an equal opportunity, gender-neutral approach to recruitment. The mean bonus payment gap was +44%, up from +27% in the prior year. As previously discussed, the business has over 3 times the number of female employees receiving bonus payments compared to male employees. Some of the bonuses at the lower end of the bonus payment range are made to administrative functions that tend to be predominantly female, hence the higher mean payment made to male employees. On review of all bonus structures, we can confirm that such incentives are implemented on a role-by-role basis, and that variations in bonus payments are reflective of the positions held by individuals, and their attainment against pre-set criteria, neither of which are influenced or inhibited by gender.   

We will continue to monitor the progress of our Gender Pay Gap data, and implement any actions outlined above. I confirm that the data provided is accurate and meets the requirements of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017.

David Horry        Chairman & CEO