2018 gender pay gap report - penguin books uk

2018 GENDER PAY GAP REPORT

Contents1 Introduction 3

2 About Penguin Random House 4

3 Reporting our gender pay gap 5

4 Our gender pay gap data 6

5 What we’ve done so far 8

6 What more we need to do 10

6 Statutory disclosure 11

Penguin Random House Gender Pay 2018 | 2

Aside from the moral imperative, we know that when you bring people together from different backgrounds with diverse experiences and perspectives you foster greater creativity. As a result, we believe that being a truly inclusive employer is fundamental to making us better publishers for our authors and our readers.

We believe in equal opportunities for everyone, which is why we continue to work towards a gender balanced organisation at all levels; striving to ensure any gender pay gap is as close to zero as possible.

Compared to 2017, our mean gender pay gap for 2018 has reduced, while our median has seen a small increase.

Analysis shows that the main reasons for the gender pay gap are related to the shape of our organisation, specifically:

n An increased proportion of men in senior and higher paid roles in comparison to our overall gender split;

n A lack of men in entry-level roles, particularly in our publishing divisions, which are 78% female;

n Fewer women in functions such as Technology, where salaries are significantly higher compared to other roles specific to the publishing sector.

We are proud of the balanced gender representation we have in our leadership team and female leaders in our Technology, Legal & Contracts and Facilities teams. We’re also proud of the progression of the impressive female talent already within our organisation into senior roles.

But as well as continuing to focus on the progression of women in our organisation, we have work to do to attract more women into historically male dominated and higher paid sectors like Technology.

We also recognise the need to focus on how we attract more men to publishing, especially in our entry-level and mid-level roles if we are to achieve a truly gender balanced workforce in the future.

We detail in this report the ways in which we are working to address these areas and we are confident that our efforts will make a difference but we are realistic that this will take time. We’re also mindful that some of the actions we take can increase the pay gap in the short term, such as increasing the opportunities to work flexibly.

We continue to prioritise reducing the gender pay gap at Penguin Random House with an ultimate ambition to create a truly level playing field for all colleagues, regardless of gender.

Val Garside, Director of Human Resources

I confirm that Penguin Random House UK’s gender pay gap calculations are accurate.

Introduction


At Penguin Random House UK, our ambition is that our employees reflect UK society. Alongside gender diversity, this means considering ethnicity, sexuality, social mobility, disability and diversity of mind-set.

We are a vibrant community of publishing houses, representing distinguished publishing histories marked by unparalleled success. We sell and license books in over 120 countries, connecting great books with a growing and global audience. We are proud of our strong heritage of bringing some of the greatest female voices from around the world to the fore through our books: from Zadie Smith, Jacqueline Wilson and Michelle Obama, to Nigella Lawson, Malorie Blackman and Paula Hawkins.

Our books and stories should be for everyone – and we believe that having a diverse workforce is just as important as publishing a diverse list of authors. Our business thrives on great teamwork that

blends the distinctive talents, skills and perspectives of people from a range of different backgrounds.

When Allen Lane published the first Penguin books in 1935, realising his vision to make quality books available to all at low prices, five of the ten titles on his list were by women: Agatha Christie, Susan Ertz, E. H. Young, Dorothy L. Sayers and Mary Webb. We want to continue this legacy and ensure that the authors we publish – and the people behind these books, who make up our company – are reflective of the society we live in.


About Penguin Random House UK

Reporting our gender pay gap


The gender pay gap shows the difference in the average pay between all men and women in a workforce. This is different to ‘equal pay’, which looks at any differences in pay between men and women doing the same job.

Penguin Random House UK ensures men and women doing the same job at the same level are paid on fair and consistent terms. Companies can still have a gender pay gap without having any unequal pay issues.

The gender pay gap is based on an hourly pay rate for each relevant employee, reflecting base salary and certain allowances, and total variable pay over the previous 12 months, representing cash bonus paid plus any proceeds on exercise of share plans or long term investment plan awards.

Disclosures on pay included in this report are based on amounts paid via payroll in April 2018 (i.e. for the period 1 April 2018 to 30 April 2018), whilst bonus data refers to the pay period from 6 April 2017 to 5 April 2018.

On the following pages, the hourly pay and bonus pay gaps look at both the median and the mean calculations.

The median relates to the middle value of an ordered set of values; i.e. representing the ‘typical’ difference as it is unaffected by particularly high or low values at either end. The mean adds up all of the relevant salaries, calculating the overall average.

Hourly pay

The median pay gap has increased slightly in the past year to 3.0% in favour of men in April 2018. This is due to the closure of one of our distribution sites and a reduction in the number of male colleagues in the lower pay quartile. Our mean pay gap, however, has moved closer to zero; decreasing by 2.0% to 9.3%.

Our gender pay gap data

Overall company gender split Men Women

39.6% 60.4%


The pay quartile analysis shows our organisation divided into four equal quarters, based on hourly pay and the proportion of men and women in each quartile. Overall, the gender split at Penguin Random House, shown in the first bar, is 39.6% male and 60.4% female.

The proportion of women in the upper middle quartile is broadly the same as 2017. The proportion of women in all other pay quartiles has increased. These shifts contribute to the change in both median and mean hourly gender pay gaps.

n The increase in the number of women in the upper quartile – with more women in more senior and higher paid roles – has contributed to the reduction in the mean pay gap versus 2017.

n The increase in the number of women in the lower quartile has contributed to the shift in the median gap from being marginally in favour of women (-1.6%; April 2017), to marginally in favour of men (3.0%; April 2018). This partly results from the gender split of employees leaving the company after our distribution site closure (67% men, versus 33% women). It also reflects the trends we see in entry level recruitment in our publishing division, where the majority of new hires are female.

The shape of our organisation is still the main reason for our gender pay gap, with more men in more senior and higher paid roles in comparison to our overall gender split. Contributing to this is the job mix in our company and the corresponding variations in pay. For example, in our largest department – Technology – where salaries are significantly higher compared to other roles specific to the publishing sector, it is 74% male.

Median gender pay gap

3.0%

Mean gender pay gap

9.3%2017: – 1.6% 2017: 11.3%

Proportion of men and women in each pay quartile

Upper pay quartile

Upper middle pay quartile

Lower middle pay quartile

Lower pay quartile

46.4% 53.6%

34.4% 65.6%

29.8% 70.2%

48.4% 51.6%

At the time of the report our leadership team was 53% male and 47% female. Today, it’s 50% male and 50% female, with a male CEO.

47% 53%

The median and mean difference between the average hourly earnings for men and women.

Leadership team gender split

Our gender pay gap data


Proportion of colleagues receiving a bonus paymentOur bonus awards are gender neutral. In the period covered by the report, all Penguin Random House UK employees were entitled to receive a bonus or profit share after completing their probationary period, regardless of role or gender. Importantly, bonus and profit share payments are based on our company performance, with employees performing similar roles receiving the same bonus percentage.

Accordingly, the difference in the proportion of male and female colleagues receiving a bonus or profit share was as a direct result of the gender mix of new joiners who had not yet become eligible to join the scheme. The higher numbers versus 2017 (79.8% of men and 77.6% of women) reflect changes we made in 2018 to reduce the qualifying period from one year to end of probation; meaning all new employees could earn a bonus sooner.

Male: 92.2%

Female: 88.6%

Bonus pay

The median gender bonus gap has moved to 16.4% in 2018: reflecting the changes in our distribution operation (as outlined earlier in the report), where colleagues received a lower fixed profit share bonus reflecting market practice in these roles. Despite the swing, however, we are pleased that our 2018 figure is closer to a zero pay gap by 8%.

Our mean bonus gap has grown slightly, to 35.5% in 2018. Our gap here reflects that the level of bonus paid increases with seniority, and the fact that we have a higher number of men in the upper quartile compared to the overall gender split of the organisation.

It is also important to note that 3% of male and 16% of female colleagues have chosen to work flexibly by reducing their hours. The calculations required for the bonus gap measure do not take into account that part-time workers have a pro-rated bonus opportunity. If this were taken into account, the gender bonus gap would reduce to 12.1% (median) and 33% (mean).

Median gender bonus gap

16.4%

Mean gender bonus gap

35.5%2017: – 24.4% 2017: 33%

The median and mean difference between the average bonus earnings for men and women.

Over the past year we have begun our work towards the four areas of focus outlined in our 2017 report, all of which we hope will reduce our gender pay gap over the long term. More broadly, these areas support our long-term goal of levelling the playing field and ensuring a truly gender neutral working environment at Penguin Random House UK.

It’s important to note, however, that as per government requirements, the figures disclosed in this report are based on amounts paid via payroll in April 2018 – therefore before work on any of these focus areas had started.

1 Work towards a more balanced gender representation in the layer below our senior leadership.

We already have strong female representation in our Leadership Team, with female Managing Directors running five of our nine publishing houses, and women heading up our HR, Operations and Brand & Communications divisions. We are working hard to ensure that we are also better supporting women moving into and up through the company, particularly at the level below our Leadership Team. Actions and initiatives in place to achieve this include:

What we’ve done so farn Penguin Random House mentoring scheme:

Launched in 2018, we currently have 80 mentees taking part in our new mentoring programme, of which 85% are female, of varying levels of seniority. Of our 67 mentors, 67% are female.

n Leadership development programmes: We run a number of programmes designed to help our current and future leaders develop and enhance their skills, such as our Creative Leadership Programme, which aims to give our leaders the support and tools required to develop and lead Penguin Random House into the future. 57 people took part in these programmes in 2018, of which 67% were female.

n Unconscious bias training: Over 680 colleagues across the business have undertaken unconscious bias training. We have also piloted an unconscious bias training specifically for hiring managers and will be rolling out a series of workshops this year.

n Recruitment: For the period covered by the report, there were 22 hires at a senior level (i.e. for roles with a ‘Director’ or ‘Head of’ title). 3 out of those 22 were male (13.6%), and 19 were female (86.4%). At entry level there were 211 hires made, of which 77 were male (36.5%) and 134 were female (63.5%).


2 Provide even better support for working mothers.

We want to do more for returning mothers during their transition back to work after maternity leave or an extended time away from the office. We are identifying ways to make this process even easier, to better help returning mothers find their feet back at work without compromising time at home or with their family.

n Parental mentoring: Included in the offer of our new mentoring scheme is parental mentoring; designed to support colleagues who’ve recently returned from, or are about to go on, parental leave.

n Trialling additional tools for new parents: We are currently trialling a partnership which provides support to new parents during and after parental leave. This includes providing help to access and financial contribution towards trusted postnatal support.

3 Explore more flexible working options for all colleagues.

We understand the need to provide a more flexible working environment for our colleagues as they seek to strike a better balance between their work and their personal lives.

In 2018 we completely refreshed our flexible working offer to enable colleagues to work more flexibly through either formal or informal arrangements, including introducing flexible start and finish times and more technology support for working from home. Since we launched we have seen a significant uplift in the number of people working from home, as well as the number of people with agreed formal flexible working arrangements.

4 Introduce pay banding.

We are currently working on the introduction of a robust job evaluation process, and will launch pay bands for every role by the end of 2019. This will enable us to share with employees transparent pay ranges that avoid any gender bias.

To support this launch, we are preparing guides for employees to help them feel confident in preparing for and having conversations about pay. Additionally, we have developed prompts for colleagues to feel more comfortable in introducing and discussing pay in their annual performance and development conversations, which were rolled out earlier this year.

We are also promoting career mobility across the company through our Design Your Career programme, and will be increasing transparency about the type of roles, and skills, competencies and expertise needed for each key area/function in publishing to encourage movement and progression.



managers during these times. We will actively seek colleagues’ feedback (both Mums and Dads) on their experiences, and where we could extend our support.

n Progression for maternity leavers: In conjunction with Penguin Parents, we will also ensure that all those going on maternity leave are offered the option to be kept informed of vacancies and promotional opportunities throughout their time away from work.

n Promoting learning and development training that builds confidence, resilience and voice.

n Gender neutral language in job adverts: We will use tools, such as Applied, to ensure that the language in all our job adverts is gender neutral. We hope this will encourage more women to apply for roles in traditionally male-dominated areas, such as Technology, and men for our publishing and group entry level roles.

n Recruitment: A 2019 focus is attracting more people in the technology industry to work in publishing, with a particular focus on women in tech.

What more we need to doOther changes which we are making – such as offering more flexible working options, which aim to have a positive impact on colleagues’ careers and work-life balance overall – can actually have a negative impact on the gender pay gap. The calculations required for the bonus pay gap measure, for example, do not take into account that part-time workers have a prorated bonus opportunity. So far, we have seen significantly more women take up formal flexible working arrangements than men (3% of men versus 16% of women have chosen to work flexibly by reducing their hours).

That said, we understand that the option for working flexibly is an important step in ensuring that we offer a level playing field for all our colleagues, whatever their gender. We are embedding our flexible working offering with two additional areas of focus over the next few months:

n Highlighting practical tips for making flexible working easier across teams.

n Working with colleagues at all levels to build even stronger understanding of the benefits of flexible working for creativity, inclusivity and wellbeing.


We are proud of the work we have done so far, and are confident that our efforts will make an impact over the longer term. However, the gender pay gap is affected by a myriad of different factors and many of our efforts might not have an immediate impact on our gap in the shorter term

For example, an area we have identified as contributing to our gender pay gap is the shape of our organisation. Making meaningful change to shift this balance will not happen overnight. Instead, it is about making sure we continue to provide more development and support opportunities for women as they move up through their careers. It is also about attracting more men to entry level roles, particularly in our publishing and group divisions.

Based on the factors which we have identified as driving our gap, we are also focusing on the following areas, which we hope will contribute to a shift the shape of our organisation in the mid– to long-term:

n Penguin Parents programme: We want to improve our support we provide to employees who are parents. A key focus is a review of maternity support – before, during and upon return to work – as well as the support and guidance we give to


Statutory disclosureThe Random House Group


-1.7%

Mean gender pay gap

7.6%

Upper pay quartile



Lower pay quartile

Men Women

49.7% 50.3%

36.1% 63.9%

32.5% 67.5%

54.4% 45.6%

Proportion of colleagues receiving a bonus payment

Male: 91.8%

Female: 88.6%


17.1%


36.2%

Hourly pay


Bonus pay

Penguin Books Ltd and DK


9.6%

Mean gender pay gap

22.6%

Upper pay quartile



Lower pay quartile

Men Women

35.7% 64.3%

27.0% 73.0%

28.8% 71.2%

15.4% 84.6%

Proportion of colleagues receiving a bonus payment

Male: 94.4%

Female: 89.5%


-34.4%


60.8%

Hourly pay


Bonus pay

Under the Regulations we are required to report the gender pay gap for each of our legal employing entities with more than 250 employees. As a result of a merger in 2013, Penguin Random House UK has two employing entities: The Random House Group, and Penguin Books Ltd. Dorling Kindersley (DK) operates independently of Penguin Random House UK; however its employees are also employed by Penguin Books.

We have therefore voluntarily reported our gender pay gap data as Penguin Random House, excluding DK, as this reflects a meaningful data set for our organisation. We have also provided separate data for The Random House Group and Penguin Books Ltd (including DK), as disclosed here:

2018 gender pay gap report - penguin books uk

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