An examination of teachers’ pay - updated – An examination of teachers’ pay – updated,...
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Incomes Data Services 23 College Hill London EC4R 2RP Telephone: 020 7429 6800 Facsimile: 020 7393 8081 E-mail: [email protected] Website: www.incomesdata.co.uk
An examination of teachers’ pay - updated
A report for the National Union of Teachers by Incomes Data Services
January 2009
This report was prepared by Incomes Data Services (IDS) on behalf of the NUT. It was researched and written by: Nicola Allison Jessica Evans Incomes Data Services 23 College Hill London EC4R 2RP Telephone: 020 7429 6800 Facsimile: 020 7393 8081 E-mail: [email protected] Website: www.incomesdata.co.uk Copyright © Incomes Data Services 2009
Contents
1. Key findings 1
2. Pay and progression in teaching compared with other graduate professions 2
3. Comparing teachers’ pay with other occupations by age 10
4. Pay benchmarking 13
Appendix A – Respondents to the IDS graduates’ pay survey 2009 18
Appendix B – IDS job levels 20
IDS – An examination of teachers’ pay – updated, January 2009
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1. Key findings
• This report updates previous work by IDS for the NUT, delivered in August 2008, which
looked at teachers’ pay in comparison to 2007 IDS graduates pay data, and assessed
pay and progression for teachers under the current pay structure. It uses new data on
graduates salaries, including salary data for graduates after 10 years, collected for the
first time.
• Pay data from the latest IDS research on graduates has been used to see how much
teachers would be paid if they progressed at the same rates as graduate recruits in
other sectors. A band D teacher at the top of the pay scale, ie after five years, received
£30,148 (M6). This would be 7 per cent higher, at £32,219, if the IDS median, giving
typical graduate progression over the first five years of a career, had been applied. The
equivalent figure for average graduate progression would be £35,313, some 17 per cent
higher than the M6 figure.
• After 10 years, a band D teacher at the top of the upper pay scales (U3) receives
£35,121. This would be 13 per cent higher, at £39,604, if the IDS median, giving typical
graduate progression over the first 10 years of a career, had been applied. The
equivalent figure for average graduate progression would be £41,832, some 28 per cent
higher than the U3 salary.
• Analysis of ASHE data for different age groups shows how teachers’ earnings fall
behind those in other professions. At age 20-29, median earnings for primary teachers
are above science professionals, 8 per cent below engineering professionals, and 16
per cent below health professionals. By age 40-49, median earnings for science
professionals are 12 per cent above those for primary teachers, while engineering
professionals are 14 per cent above and health professionals are 36 per cent above.
• IDS has applied its standard pay benchmarking methodology to teachers’ salaries at
three different levels. This analysis indicates that new teachers’ salaries are at 83 per
cent of market median pay for jobs at a similar level. Mid-career teachers are at 88 per
cent of market pay, and senior teachers (at the top of the pay scale) are at 73 per cent
of market pay for similar jobs. New teachers and senior teachers’ salaries were also
below the market lower quartile for jobs at a similar level.
IDS – An examination of teachers’ pay – updated, January 2009
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2. Pay and progression in teaching compared with other graduate professions
Pay and Progression for Graduates is an annual publication by the IDS Executive
Compensation Review which provides information and analysis on the state of the graduate
labour market. One part of the report looks at how successful employers have been in holding
on to their graduates recruited in past years and tracks how much their salaries have
progressed since starting work with them.
For the 2009 publication, employers were asked to provide details of the current salaries paid
to graduates they took on five and 10 years ago, groups that we term five-yearlings and 10-
yearlings. In the most recent dataset (to be published in February 2009), five-yearlings are
those taken on in 2003 and 10-yearlings are those taken on in 1998. To calculate the salary
progression of graduates over the two periods, the five-and 10-yearlings current salaries, as
supplied by the employer, are subtracted from the latest graduate recruitment rate in the same
organisation. The difference between the two, expressed as a percentage, is a ‘salary lead’.
These salary-leads have then been compared against the teacher’s pay spine as at 1
September 2008. The five-yearlings increases are compared to the equivalent increases in
salaries of graduates entering the teaching profession on main pay scale M1 and moving up to
the top of the main scale pay band M6 after five years. The 10-yearlings increases are
compared to the equivalent increases in salaries of teachers who reach the top of the upper
pay scale, U3.
Graduate starting salaries by sector (Source: IDS, Pay and Progression for Graduates)
Lower quartile £pa
Median £pa
Upper quartile £pa
Average £pa
Finance 23,500 25,000 28,000 26,232
Law & accountancy 24,000 29,400 37,000 29,674
Manufacturing 23,125 25,000 28,500 25,675
Service 22,750 24,000 26,500 24,947
Public/not-for-profit 22,434 24,045 25,390 23,835
All 23,000 25,000 28,000 25,984
IDS – An examination of teachers’ pay – updated, January 2009
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Graduate progression after five years
In order to provide the clearest indication of how teachers’ salaries after five years compare to
salaries in other professions we calculate the median and average increases across 117
organisations.
Using these figures, the M1 salary points were multiplied by the median and average salary
leads to show where the M6 salary points would stand if they had increased over the five years
by the IDS figures. To provide a further comparison this same process was applied to looking at
the salary differences by four broad sectors of manufacturing, service, finance and public/not-
for-profit.
All sector median salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS median salary lead 32,219 33,769 37,488 39,050
Band D National Band C Fringe Band B Outer London
Band A Inner London
The overall findings show that teachers at grade M6 are lagging behind in salary progression at
both the median and average than what they would have been if an IDS all-sector median or
average had been applied to the pay scale. At Band A, for example, a teacher at the top of the
pay band after five years would earn a salary of £34,768, which is 12 per cent below the
£39,050 salary had the IDS all-sector median been used. This pay differential widens to 23 per
cent when comparing the average figures.
IDS – An examination of teachers’ pay – updated, January 2009
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All sector average salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS average salary lead 35,313 37,012 41,088 42,800
Band D National Band C Fringe Band B Outer London
Band A Inner London
Five-yearlings pay progression by sector Looking at the sectoral pattern it can be seen that when increasing the M6 pay scale by the
finance salary-lead median it produces the highest salary in comparison to the other sectors.
For example, taking teachers at band B the M6 salary point is £33,554, but when using the IDS
finance sector salary-lead the figure increases to £43,104 (a 28 per cent pay differential). The
public/not-for-profit sector median has the smallest lead over teachers, but it is still positive, at
£35,784 (7 per cent) in band B.
Finance sector median salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS median salary lead 37,046 38,828 43,104 44,900
Band D National Band C Fringe Band B Outer London
Band A Inner London
IDS – An examination of teachers’ pay – updated, January 2009
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Finance sector average salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS average salary lead 37,500 39,303 43,632 45,450
Band D National Band C Fringe Band B Outer London
Band A Inner London
Public sector median salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS median salary lead 30,755 32,234 35,784 37,275
Band D National Band C Fringe Band B Outer London
Band A Inner London
When using average salary-leads, the service sector has the largest salary difference with
teachers, at £45,600 (31 per cent) in band A, but is closely followed by the finance sector, at
£45,450 (also 31 per cent). The manufacturing sector has the third-greatest difference at
£38,725 (11 per cent) in band A, with the public sector having the smallest, at £37,500 (8 per
cent). Overall, at the average, if teachers pay had increased in line with the increases in the
service sector by point M6 on the teachers’ pay scale the salary would range from £37,624 to
£45,600 depending on location, while the equivalent range using the finance salary-lead would
be £37,500 to £45,450.
IDS – An examination of teachers’ pay – updated, January 2009
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Public sector average salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS average salary lead 30,941 32,429 36,000 37,500
Band D National Band C Fringe Band B Outer London
Band A Inner London
Service sector median salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS median salary lead 34,385 36,039 40,008 41,675
Band D National Band C Fringe Band B Outer London
Band A Inner London
IDS – An examination of teachers’ pay – updated, January 2009
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Service sector average salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS average salary lead 37,624 39,433 43,776 45,600
Band D National Band C Fringe Band B Outer London
Band A Inner London
Manufacturing sector median salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS median salary lead 30,879 32,364 35,928 37,425
Band D National Band C Fringe Band B Outer London
Band A Inner London
IDS – An examination of teachers’ pay – updated, January 2009
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Manufacturing sector average salary differences (M6/five years), 2008
0
10,000
20,000
30,000
40,000
50,000
Annual salary £pa
Teacher on M6 30,148 31,138 33,554 34,768
If IDS average salary lead 31,951 33,488 37,176 38,725
Band D National Band C Fringe Band B Outer London
Band A Inner London
Graduate progression after 10 years It is less common for organisations to retain graduates for a 10-year period as within this time
often the employee has tended to move on to another organisation. However, the latest IDS
graduates report charts data provided by 13 employers who still had graduates with them after
10 years, and using the same methodology as with the five-yearlings, these salary-leads can
be compared with the top of the upper pay scale, U3. The findings show that after 10 years the
salary-leads of graduates at the median are nearly double their starting salary in 1998, and at
the average the figure is over double.
All sector median salary differences (U3/10 years), 2008
0
10,000
20,000
30,000
40,000
50,000
60,000
Annual salary £pa
Teacher on U3 35,121 36,114 38,634 42,419
If IDS median salary lead 39,604 41,508 46,080 48,000
Band D National Band C Fringe Band B Outer London
Band A Inner London
IDS – An examination of teachers’ pay – updated, January 2009
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The analysis shows that for teachers on U3, salaries after 10 years are below what they could
have been if the IDS median and average salary-leads had been used. On the scale point U3
the pay ranges from £35,121 to £42,419, but if using the IDS median salary-lead the range is
13 per cent higher, from £39,604 to £48,000. At the average the potential salary if using the
IDS average all-sector lead is much greater with a range from £41,832 to £50,700 depending
on location, a 19 per cent differential.
All sector average salary differences (U3/10 years), 2008
0
10,000
20,000
30,000
40,000
50,000
60,000
Annual salary £pa
Teacher on U3 35,121 36,114 38,634 42,419
If IDS average salary lead 41,832 43,843 48,672 50,700
Band D National Band C Fringe Band B Outer London
Band A Inner London
IDS – An examination of teachers’ pay – updated, January 2009
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3. Comparing teachers’ pay with other occupations by age
This chapter looks at how teachers’ earnings in relation to other occupations change with age.
This is done by analysing ASHE data broken down by occupational and age to see the
earnings pattern over lifetimes.
Taking the most recent data available, for 2008, teachers’ median salaries over three age
bands, 20-29; 30-39 and 40-49, are compared with the median annual earnings of science,
engineering and health professionals.
Comparison with science professionals median salaries in 2008
0
10,000
20,000
30,000
40,000
20-29 30-39 40-49Age
£pa
Primary & nursery teachersSecondary education teachersScience professionals
The first chart shows that at age 20-29 science professionals’ median earnings1 are 6 per cent
below those for primary and secondary teachers. By age 30-39, median earnings for science
professionals have caught up, so that they are 4 per cent ahead of primary teachers, and 1 per
cent behind secondary teachers. By age 40-49, science professionals’ median earnings have
moved ahead of school teachers, with a gap of 3 per cent over secondary teachers and 12 per
cent over primary teachers.
1 The median of the median salaries for chemists, biological scientists and physicists.
IDS – An examination of teachers’ pay – updated, January 2009
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Comparison with engineering professionals median salaries in 2008
0
10,000
20,000
30,000
40,000
20-29 30-39 40-49Age
£paPrimary & nursery teachersSecondary education teachersEngineering professionals
When looking at the median earnings of civil, mechanical and electrical engineers against
primary and nursery and secondary education teachers the engineering professionals are 8 per
cent above both teaching groups at age 20-29. By age 30-39, the differential has grown to 14
per cent above secondary teachers and 10 per cent above primary teachers.
Comparison with health professionals in 2008
0
10,000
20,000
30,000
40,000
50,000
20-29 30-39 40-49Age
£pa Primary & nursery teachersSecondary education teachersHealth professionals
A final comparison with health professionals, which includes medical practitioners,
psychologists and pharmacists, shows the biggest differential between this group’s median
salaries and both areas of teaching. Across all three age bands health professionals’ salaries
are consistently above those within teaching. The differential is 16 per cent above both
IDS – An examination of teachers’ pay – updated, January 2009
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teaching groups for age 20-29, but has increased to 24 per cent above secondary teachers and
36 per cent above primary teachers by age group 40-49.
Salary differences between teachers and other professions
Age band 20-29 % difference
Age band 30-39 % difference
Age band 40-49 % difference
In comparison with secondary education teachers
Science -5.9 -1.5 2.8
Engineering 8.2 14.1 4.3
Health 16.4 14.7 24.2
In comparison with primary & nursery teachers
Science -5.9 3.8 12.2
Engineering 8.2 20.2 13.9
Health 16.4 20.8 35.6
An alternative view of salaries by age can be seen by looking at pay growth within the
professional occupations. The table shows how median salaries have progressed over time by
relating the median salaries for age bands 30-39 and 40-49 by the median salaries for age
band 20-29. The findings show that within age band 30-39 engineering professionals have
seen the greatest growth in salaries by 34.8 per cent, over what their counterparts in age band
20-29 are being paid. Secondary education teachers also saw one of the highest pay growths
on their younger colleagues of 33.5 per cent. Health professionals saw the lowest growth in
earnings over the two age bands of 25.9 per cent. This picture changes when looking at the
pay growth between age bands 20-29 and 40-49, with health professionals seeing an above
double increase of 52.3 per cent. Teaching professionals saw some of the lowest pay growth,
but it was engineering professionals that saw the smallest level of growth.
Pay growth over age band 20-29 in 2008
Age band 30-39 % growth
Age band 40-49 % growth
Primary and nursery teachers 28.5 37.8
Secondary teachers 33.5 45.5
Science professionals 33.8 55.9
Engineering professionals 34.8 37.6
Health professionals 25.9 52.3
IDS – An examination of teachers’ pay – updated, January 2009
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4. Pay benchmarking
IDS regularly undertakes pay benchmarking exercises, which involve matching jobs to an IDS
job level and then benchmarking against a range of market data for jobs at the same level.
Below we conduct this exercise for newly-qualified teachers, those with five years’ experience,
and senior teachers at the top of the pay scale. While we are not suggesting direct equivalence
between the roles, the data draws a broad comparison between alternative occupations at
similar levels, using available data sources. Usually we would seek to use three sources of
market data. The data is all for employees at a national level; where necessary it has been
updated slightly to be consistent across all data sources.
The newly-qualified teachers have been evaluated at IDS job level 5, mid-career teachers (five
years’ experience) at IDS job level 7 and the senior teachers (10 years’ experience) at IDS job
level 8. More information about IDS job levels is given in appendix B.
1. Newly-qualified teacher
Data source Job match Lower quartile £pa Median £pa Upper
quartile £pa
Engineering survey I Engineering graduate 20,600 24,617 25,750
Engineering survey II Graduate - 27,540 -
Universities Junior lecturer 29,704 32,458 35,469
NHS Physiotherapist/ radiographer/SLT (band 5)
20,225 23,174 26,123
ECR graduates survey New graduate 23,000 25,000 28,000
Market summary 21,800 25,000 27,062
IDS – An examination of teachers’ pay – updated, January 2009
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2. Mid-career teacher
Data source Job match Lower quartile £pa Median £pa Upper
quartile £pa
Engineering survey I Senior engineer 30,286 34,270 40,170
Engineering survey II Engineer - 34,221 -
Universities Lecturer 36,532 39,920 43,622
NHS Physiotherapist/ radiographer/ SLT advanced (band 7)
29,091 33,722 38,352
ECR graduates survey
Graduate after 5 years 30,000 36,160 45,000
Market summary 30,143 34,270 41,896
3. Senior teacher
Data source Job match Lower quartile £pa Median £pa Upper
quartile £pa
Engineering survey I Engineering manager 35,709 41,000 45,100
Engineering survey II Senior engineer - 50,592 -
Universities Senior lecturer 44,930 48,381 52,086
NHS Physiotherapist/ radiographer/SLT principal (band 8a)
37,106 40,817 44,527
ECR graduates survey
Graduate after 10 years 43,002 47,552 57,695
Market summary 40,054 48,381 44,814
IDS – An examination of teachers’ pay – updated, January 2009
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Summary of market data
Lower quartile £pa Median £pa Upper quartile
£pa
1. Newly-qualified teacher 21,800 25,000 27,062
2. Mid-career teacher 30,143 34,270 41,896
3. Senior teacher 40,054 48,381 44,814
The table bellows compares the market medians from the range of data sources to teachers’
pay rates at the start (M1), after five years (M6), and at the top of the discretionary pay scales
(U3). Typically a salary within 10 per cent is considered to be in line with the market. In all
cases, teachers pay is below the market. The differential is greatest for the teachers at the top
of the pay scale, where the salary is at 74 per cent of equivalent market jobs.
Market medians compared to teachers’ pay rates
Teachers’ pay rate (band D) Median £pa
Teachers’ pay compared to the market median
1. Newly-qualified teacher 20,627 25,000 83%
2. Mid-career teacher 30,148 34,270 88%
3. Senior teacher 35,121 48,381 73%
IDS – An examination of teachers’ pay – updated, January 2009
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Market medians compared to teachers’ pay rates
0
10,000
20,000
30,000
40,000
50,000
1. Newly-qualifiedteacher
2. Mid-career teacher 3. Senior teacher
Teachers's payMarket median
£pa
Pay for newly-qualified teachers is below the lower quartile for comparable jobs, pay for mid-
career teachers is at the market lower quartile, and pay for senior teachers is at just 88 per cent
of the market lower quartile.
Market lower quartiles compared to teachers’ pay rates
Teachers’ pay rate (band D)
Lower quartile £pa
Teachers’ pay compared to the market lower quartile
1. Newly-qualified teacher 20,627 21,800 93%
2. Mid-career teacher 30,148 30,143 100%
3. Senior teacher 35,121 40,054 88%
IDS – An examination of teachers’ pay – updated, January 2009
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Market lower quartiles compared to teachers’ pay rates
0
10,000
20,000
30,000
40,000
50,000
60,000
1. Newly-qualifiedteacher
2. Mid-career teacher 3. Senior teacher
Teachers' payMarket lower quartile
£pa
IDS – An examination of teachers’ pay – updated, January 2009
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Appendix A – Respondents to the IDS graduates’ pay survey
AC Nielsen Bases Government Communications Headquarters Aegis Media Hazlewoods LLP Aker Kvaerner Herbert Smith Aker Kvaerner Hewitt Associates Allen & Overy LLP HM Prison Service Alliance & Leicester HM Treasury Alvis Vickers Hoyer UK Ltd Anglian Water Services Ltd IFS UK Aon UK IG Group Holdings plc Army IG Index Asda Ilmor Engineering Associated British Ports Ince & Co ATIS REAL Weatheralls Interfleet Technology Baillie Gifford & Co IPOS UK Bank of England Jaguar and Landrover Bechtel John Wood Group Plc BG Group Kendall Freeman Bidwells Kerry Group Plc Blick Rothenberg Laing O'Rourke Brebner Allen & Trapp Lambert Smith Hampton British Standards Institute Lloyds TSB Burges Salmon Makro S.S.W Buro Happold Marsh Caterpillar (Northern Ireland) Masterfoods Clyde & Co Merck Sharp & Dohme CMS Cameron McKenna Nabarro Nathanson Corus Nationwide Building Society Countryside Properties Next Retail Croda NHS Graduate Scheme Cummins Nissan Motor UK Demag Delaval Turbomachinery NOP World Department for Transport Nortel Devathlon UK Norther Ireland Civil Service DHL NRG Management Limited Dixon Wilson Organon Research Scotland DLA Piper Pearl Group Services LTD Domestic and General Price & Myers LLP EDF Energy Reeves and Neylan Edwards Geldard Rehau ExxonMobil Rentokil Initial Field Fisher Waterhouse Ricardo UK Financial Services Authority Royal and Sun Alliance Fitzpatrick Contractors RSM Robson Rhodes FKI Plc RWE nPower Flight Centre Saffery Champness Freshfields Bruckhaus Deringer Samworth Brothers Gallaher Ltd Servier Laboratories Geo. Adams & Sons Ltd Servier Laboratories GFK NOP Ltd Severn Trent GlaxoSmithKline Siemens Industrial Turbomachinery
IDS – An examination of teachers’ pay – updated, January 2009
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Softcat Ltd Watson Wyatt Standard Life Willis Group Services Symonds Group Wincanton Thomas May & Co Woolworths Group Total E&P UK Plc Wragge & Co LLP TRL Writing Machine United Utilities Xerox Vaisala Yorkshire Building Society Vehicle and Operator Services Agency
IDS – An examination of teachers’ pay – updated, January 2009
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Appendix B – IDS job levels
CAPSULE JOB LEVELS MATRIX Category Level Description Administrative, manual and support
1 Work requires basic literacy and numeracy skills and the ability to perform a few straightforward and short-term tasks to instructions under immediate supervision. Previous experience is not necessary
2 Work requires developed literacy and numeracy skills and the ability to perform some routine tasks within procedures that may include keyboard and practical skills and initial contact with customers. Some previous experience is required
Secretarial/Craft
3 Work requires specific administrative, practical, craft or technical skills gained by previous experience and qualifications to carry out a range of less routine work and to provide specialist support, and could include closer contact with the public/customers
4 Work requires broad and deep administrative, technical or craft skills and experience to carry out a wider range of activities including staff supervision, undertaking specialist routines and procedures and providing some advice
Vocational/Supervisory
5 Work requires detailed experience and possibly some level of vocational qualification to be able to oversee the operation of an important procedure or to provide specialist advice and services, involving applied knowledge of internal systems and procedures
6 Work requires a vocational qualification and sufficient relevant specialist experience to be able to manage a section or operate with self-contained expertise in a specialist discipline or activity
Professional/Managerial
7 Work is concerned with the provision of professional services and requires an experienced and qualified professional to provide expertise and advice and operate independently. Would also include operational managers responsible for service delivery
8 Work requires deeper professional experience and qualifications in a specific discipline to be able to carry out a range of specialist technical or scientific activities, which may include the management of a team or services. May also include specialist management roles responsible for delivery of a major service
Senior management
9 Senior managerial roles involved in managing an important activity or providing authoritative expertise, also contributing to the organisation as a whole through significant experience
Director
10 Member of a company board or an executive/senior management team in public sector organisations, with overall functional responsibility and input to the strategy of the wider organisation, through deep and broad experience
Chief Executive
11 The most senior posts in an organisation responsible for setting the overall direction, strategy, financial success, and performance achievement requiring substantial business pre-eminence