Pay Equity

Rio Tinto strives to create an inclusive culture where all people are heard, valued and respected.


Rio Tinto’s Commitment to Pay Equity

Rio Tinto strives to create an inclusive culture where all people are heard, valued and respected. We embrace workforce diversity and value differences. Consistent with our vision for inclusion and diversity, we are committed to ensuring that employees with similar skills, knowledge, qualifications, experience and performance are paid equally for the same or comparable work.

Both the ‘equal pay gap’ and the ‘gender pay gap’ measure pay differences between women and men in the workplace, but they measure two different things:

  • An ‘Equal Pay Gap’ arises when men and women employed by the same company, in the same location, performing equal work, do not receive the same pay.
  • The ‘Gender Pay Gap’ is a measure of the difference between men’s and women’s average earnings across an organisation or industry, regardless of the roles that each are performing. It is normally expressed as a percentage of men’s earnings.
  • Equal Pay Gap
  • Gender Pay Gap

Equal Pay

Equal Pay is at the core of Rio Tinto’s approach to pay equity. We use a like-for-like approach to measure and monitor Equal Pay across the Group (irrespective of the regulatory requirements and methodologies that we are required to adopt for local reporting). This means that we compare the pay of employees performing the same roles in the same location or country.

This like-for-like approach is used for all jobs where both females and males are represented. A positive percentage indicates an equal pay gap in favour of men. A negative percentage indicates an equal pay gap in favour of women. Rio Tinto’s equal pay gap on 31 December 2019 was under 2%*. Rio Tinto will continue to monitor equal pay to ensure that any differences are due to legitimate factors, and will take action as appropriate.

Gender Pay Gap

The gender pay gap, unlike equal pay, is also influenced by the relative seniority of men and women in an organisation or industry. Across the entire Group, the gender pay gap on 31 December 2019 was under 1%*. However, this apparently good result for the Group as a whole reflects the large sample size and marks a less favourable positon at our head office in the UK. Across the entire workforce, as the equal pay gap suggests, there is relatively little difference between the average pay of men and women, but there is still a relatively low level of gender diversity in the most senior management positions. Rio Tinto is addressing this through a number of initiatives, including targets to increase the representation of women in senior management roles and a focus on improving the representation of women in our graduate intakes.

Both the equal pay gap and the Group-wide gender pay gap are measured and monitored on a voluntary basis by Rio Tinto, in parallel with country-specific mandatory reporting requirements. Under UK regulations, while none of our UK employing entities meet the minimum reporting threshold of 250 employees, details of the gender pay gap for the largest entity (Rio Tinto London Limited) have been voluntarily disclosed.

* Note: Defined as full time equivalent, contractual base salary

UK-Specific “Gender Pay Gap” Disclosures

The methodology required by the UK regulations differs from Rio Tinto’s approach to assessing gender pay equity.

The UK methodology calculates the difference in average pay and bonuses between all male and female employees within an employing entity. It is expressed as a percentage of men’s earnings. This differs from Equal Pay which means that men and women in the same employment performing equal work must receive equal pay.

Rio Tinto is not obliged to publish the “gender pay gap” report for any of its UK employing entities for 2019, as none of these entities reach the minimum reporting threshold of 250 employees. However we have chosen to voluntarily publish figures for the largest employing entity in the UK, Rio Tinto London Limited, as set out below:

Rio Tinto London Limited Gender Pay Gap Metrics (UK Government Methodology)

Gender Pay Gap disclosable metrics (see below for definitions) Results RTLL (April 2018) Results RTLL (April 2019) Results RTLL (Dec 2019)3

Mean hourly gender pay gap1

48.5%

52.5%

44.8%

Median hourly gender pay gap1

35%

47.9%

34.4%

Mean bonus gender pay gap for the year2

72.3%

79.7%

82%

Median bonus gender pay gap for year2

63.1%

84.7%

80.8%

Proportion of males receiving a bonus payment

95%

89%

80%

Proportion of females receiving a bonus payment

98%

98%

76%

Notes:
Indicates by how much women’s mean/median hourly rate is lower than men
Indicates by how much women’s mean/median bonus is lower than men
31 December 2019 analysis has been included to show a more current view of the UK gender pay gap position. Between April 2018 and December 2019 there has been a significant amount of employee movement from the implementation of our new operating model which has had a significant impact on the pay gap metrics.

 

Proportion of males and females in each quartile pay band Males as at April 2018 Females as at April 2018 Males as at April 2019 Females as at April 2019 Males as at Dec 2019 Females as at Dec 2019

Lower Pay Quartile

18%

82%

7%

93%

12%

88%

Lower Middle Pay Quartile

51%

49%

50%

50%

41%

59%

Upper Middle Pay Quartile

57%

43%

70%

30%

75%

25%

Upper Pay Quartile

80%

20%

80%

20%

72%

28%


Definitions used for UK disclosures in table above:

Mean/Median Gender Pay Gap

Difference between the mean / median hourly rate of pay paid to male and female employees (employees whose pay has been reduced as a result of leave and therefore are not "full-pay relevant" are excluded from the analysis). A positive value indicates that the males' hourly pay is higher than the one of females.

Mean/Median Bonus Gender Pay Gap

Difference between the mean / median bonus pay paid to male and female employees (employees not in receipt of a bonus are excluded from the analysis). A positive value indicates that the males' bonus is higher than the one of females.

Prop. Males/Females Receiving Bonus

Proportion of male / female employees who were paid a bonus

Prop. Males/Females in each Quartile Band

Proportion of male / female employees in four quartile bands, which are calculated by dividing the employee population into four equal parts

Commentary on Results for Rio Tinto London Limited

Gender pay gap calculations, including the UK pay gap methodology, are deeply influenced by the seniority of men and women in an organisation and industry.

Women continue to be under-represented in senior roles at Rio Tinto, and this is evident in Rio Tinto London Limited, where employees are primarily located in a small corporate office in London, which contains some of the most senior roles in the company. As female representation at senior levels is lower, this proportionally affects the size of the UK pay gap metrics. The approach to addressing this in the UK is the same as our global goals, including targets to increase the representation of women in senior management positions by 2% year on year and for women to represent 50 per cent or more of our graduate intake.

Hourly Pay Gap

The hourly pay gap is a reflection of the number of women in senior roles at Rio Tinto London Limited, as evidenced by the percentage of women in roles paid in the upper quartile or middle upper quartile.

It is worth noting that the reported level of Gender Pay Gap is not evident when there are equal numbers of men and women at a given level of seniority. For example, in middle management and middle professional roles, which are the most balanced in term of gender representation in Rio Tinto London Limited, the mean Gender Pay Gap is 5.6% and the median pay gap is 8.2% in favour of males at 31 December 2019.

Bonus Gap

The ‘bonus’ primarily includes the value of short (STIP) and long term (LTIP) incentives.

Individual and business performance is used to determine the level of STIP awards. Rio Tinto drives consistency and fairness checks on individual performance as part of the performance review process. However, individuals reaching the same performance rating, receiving the same salary, and the same STIP opportunity, may not receive the same STIP cash award where the performance of their respective business units is different.

Consistency and fairness checks are also conducted annually on LTIP awards as part of the Annual Remuneration Review.

The variation in the ‘bonus’ gap is primarily driven by a higher representation of men in upper bands, which attract higher salaries, STIP and LTIP opportunities in the UK market.