Nest outlines actions towards pay parity

Nest has outlined the actions it is taking to work towards pay parity after its latest ethnic and gender pay data revealed that there remained "room for progress".

Recent data from the scheme showed that the median gender pay gap was 12 per cent, or £4.26 per hour, in 2023/24, a 1 percentage point increase from 2022/23, when the gap was 11 per cent or £3.69 per hour.

Since Nest’s first report of its pay data in 2017, there has been a reduction of 12.2 percentage points in its gender pay gap.

Alongside this, as of 31 March 2024, 48 per cent of senior leadership roles were held by women.

Nest's median ethnicity pay gap was 22 per cent, or £7.93 per hour, an increase of 4 percentage points from 2022/23 when the gap was 18 per cent, or £6.03 per hour.

More women were recruited than men in 2023/24 at Nest, with 51 per cent of the workforce being women.

Despite this, over the same period, Nest saw more women than men leave the corporation and there continued to be over-representation of women in lower quartile ranges.

People from an ethnic minority background represented 30 per cent of the workforce at Nest, compared with around 14 per cent of the general population of England and Wales, with 40 per cent of new starters in the past year from ethnic minority groups.

However, despite the improvements, the scheme recognised that employees from an ethnic minority background continue to be under-represented in the upper pay quartile and over-represented in the lower quartile.

Nest has announced plans to launch a job-sharing policy to support colleagues who want to change their working pattern and to continue to promote flexible working, with plans to launch a return-to-work programme for colleagues who have been on extended leave.

It also said it would review its recruitment training to support hiring managers to become more consciously inclusive, including recommending hiring managers to take action for more diverse interview panels, and continue seeking out job boards aimed at people from ethnic backgrounds.

Additionally, Nest said it would create a dashboard to understand the experience of their employees to address areas of opportunity and equality, and will gather data and insight on intersectionality.

It also plans to launch a mentoring programme for staff from ethnic minority backgrounds to ensure Nest is focused on developing internal talent, looking for opportunities to improve diversity across the wider pensions industry and pushing for change, including holding the companies it invests in to account, such as on gender pay gaps and pay equity ambitions.

Commenting on the data, Nest chief executive officer, Ian Cornelius, said: “We’ve laid solid foundations which can be seen in a number of areas, such as our commitment to diversity equity and inclusion (DE&I) training and inclusive recruitment, and I’m proud that colleagues play a leading role co-creating our policies.

“But these figures show that we must challenge ourselves to do more – seizing all opportunities and driving actions forward in order to close the gap.

“I am committed to pushing us forward in our work on DE&I. Supported by the leadership across Nest, we will continue striving to meet and exceed our targets and work to reduce the pay gap.”

Adding to this, Nest’s DE&I sponsor and chief financial officer, Richard Lockwood, said: “This year’s data, which shows Nest has its smallest gender pay gap since reporting began in 2017 is very encouraging and I’m proud that many of our policies and actions have been created in partnership with our gender working group.

“We know we cannot rest on our laurels. There is much more to be done and we must continue to build on our long-term plans in order to achieve pay parity. We also know there’s still much work to be done on our ethnicity pay gap.

“We remain steadfast in our commitment to diversity, equity and inclusion at Nest and will continue to build on our long-term plans to close the gap with a wide range of initiatives to attract, develop and retain talent from ethnically diverse backgrounds.”

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