Fair pay? Excellent!
Your route to the Fair Pay certificate

The UNIVERSAL FAIR PAY CHECK...

• ... can be carried out worldwide regardless of the size of the enterprise, the number of employees, the organizational structure or the applicable legislation at any location,
• ... was developed by the non-profit Fair Pay Innovation Lab (FPI) in Berlin,
• ... helps to close pay gaps in the shortest possible time,
• ... combines legislative initiatives from Iceland, Great Britain, and Switzerland in a single procedure,
• ... takes into account existing and forthcoming legislation,
• ... is awarded under the patronage of Hubertus Heil, German Federal Minister of Labour.
• ... has already been awarded to companies such as the German insurance company Allianz Deutschland AG, the second-largest Icelandic energy company Reykjavík Energy, and the digital agency Rheingans GmbH.

The UNIVERSAL FAIR PAY CHECK explained in 150 seconds

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Contact: contact@fpi-lab.org, +49 30 83 21 71 40

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First steps

At the start of the Universal Fair Pay Check, organizations examine their pay structures. As part of the analysis, the payroll system and the corresponding components are assessed to see whether they reflect the company ethos. In the analysis, those factors that influence remuneration are broken down, for example, role, department, or length of service. Furthermore, the effect of variables that should not affect remuneration, such as sex, for example, is calculated. The list of variables from the Fair Pay Matrix can serve as the basis.

Analysis & evaluation

The analysis is carried out on the basis of the organization’s internal data, and it provides the foundation for a precise determination of all further steps necessary to implement fair pay. From the analysis, it is apparent how the whole spectrum of employees in the organization is distributed over the various salary levels. In particular, using such data flags up the challenges specific to the organization in the implementation of equality and fair pay, and determines the appropriate methods and instruments for closing any identified gaps.

Tools for the analysis

The organization can choose its own form of analysis. Suitable tools for calculating the pay gaps can be found in the FPI Tool Compass. All companies and organizations are invited to share Best Practices: they will receive our Best Practice Arguments, access to our Expertise Pool, and Best Practice Insights. Companies and organizations can discuss suitable tools and methods in Fair Pay Workshops.

Requirements for achieving the status of UNIVERSAL FAIR PAY ANALYST

• The organization carries out an analysis of the pay structures for all its employees.
• At the very least, this analysis will calculate the unadjusted and adjusted gender pay gaps (in respect of basic salary, bonuses, and total remuneration). It is useful to then identify further pay gaps on the basis of demographic factors such as age or ethnic origin.
  The unadjusted gender pay gap shows the percentage difference between the average gross hourly pay for women and men.
  The adjusted gender pay gap shows the percentage difference between the average gross hourly pay for women and men in comparable positions – taking into account the variables of role, level, and requirements. The calculation is undertaken using multiple regression analysis on the basis of all employee data. If it is not possible to include all employees in the calculation, the FPI must be notified of the reasons why.
• The organization formulates suitable measures for closing the calculated gaps.
• In a written Fair Pay Commitment, the organization undertakes to implement fair pay and transparency. The organization can set itself additional goals over and above this.
• All the necessary data and measures are made available to the FPI for checking. In this phase, all the details from the organization are treated confidentially and are not published.

BECOME A FAIR PAY ANALYST

Measures: Implementation & Improvement

In the Developer phase, organizations apply the policies formulated in Phase 1 for implementing a fair pay structure. Here, organizations document the implementation process for the individual measures and check the effectiveness of the measures regularly (at least once a year). If a measure does not prove expedient, it is improved.

On the way to 0%

The aim in this phase of the check is to achieve an adjusted gender pay gap of zero percent. This means that all employees in the same and comparable positions are paid the same

Requirements for achieving the status of UNIVERSAL FAIR PAY DEVELOPER:

• • The organization implements the measures that have been set out and reports regularly to the FPI – at least once a year – on how the implementation is progressing.
  • The organization documents the implementation process for the measures as a building block in the regular effectiveness review.
  • The organization achieves an adjusted gender pay gap of +1 to -1 percent. On request, the adjusted gender pay gap can be published.

BECOME A FAIR PAY DEVELOPER

Sustainably on target

Phase 3 of the Universal Fair Pay Check is achieved once the organization has clearly lowered the unadjusted gender pay gap, the value is between -10 and +10 percent, and monitoring shows a continuous narrowing of the organization’s internal pay gap. The objective is for the company to continue its efforts, aiming for an unadjusted gender pay gap of around zero percent.

Making successes transparent

Organizations with Universal Fair Pay Leader status show that they are actively addressing their salary structures and the processes for recruitment and promotion, reconciliation policies, and the organizational culture. Successful implementation of measures is made transparent and is effective publicity as part of strategic organizational communication.

Achieving the status of Universal Fair Pay Leader is a sustainable goal and a milestone on the way towards fair pay. Depending on the starting point, organizations need several years to close the pay gap entirely and counteract any renewed widening of the income gap over the long term.

Best practice exchange

Throughout, the organization is given advice and support on a step-by-step basis over a longer period of time. Sharing Best Practice with other companies and organizations takes place routinely, in Expertise Workshops and targeted Best Practice Insights. The process and certification of an organization are not contingent upon its size, sites, organizational form, or respective statutory obligations.

Requirements for achieving the status of UNIVERSAL FAIR PAY LEADER:

• The organization shows an unadjusted gender pay gap from +10 to -10 percent.
• By continuing to implement existing measures and developing new or adjusted measures, the organization aims to achieve an unadjusted gender pay gap of around zero percent.
• The organization engages in sharing Best Practices with other organizations.
• The organization communicates openly and ensures that its efforts in relation to fair pay, as well as the level of its gender pay gap, are transparent in internal and external communications.
• The organization continues to analyze its own pay structures on a regular basis.

BECOME A FAIR PAY LEADER

Universal Fair Pay Analyst 2021/22:

• Allianz Deutschland AG
• esentri AG
• Rheingans GmbH
• API DE GmbH

Universal Fair Pay Leader 2021/22:

• Landspítali - the National University Hospital of Iceland: with an unadjusted gender pay gap of 4.7 percent and an adjusted gender pay gap of 0.8 percent.
• Reykjavík Energy: with an unadjusted gender pay gap of 7 percent and an adjusted gender pay gap of 0.3 percent.

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