Latest figures show slight reduction in gender pay gap

By Joanne Stronach Head of Employment & HR

The latest figures on the gender pay gap in large businesses show a slight reduction on last year.

Legislation introduced in 2017 means that every employer with 250 or more employees has to publish the differences between what they pay their male and female staff in average salaries and bonuses.

This is the second year that employers have been required to report their data. The new figures show:

• 8,424 private sector employers reported their data
• 3,736 employers saw their pay gap improve
• 3,387 employers saw their pay gap worsen
• 645 employers reported no change in their pay gap.

Latest statistics from the ONS show that, across all employers, the median gender pay gap is at a record low of 17.9%, down from 18.4% the previous year.

The Government Equalities Office (GEO) estimates that around 50% of relevant employers have put in place an action plan to tackle their pay gap. Ministers want to see that number increase and the GEO have published guidance to encourage employers to identify why they have a gender pay gap and how they can work to resolve it.

The Minister for Women and Equalities, Penny Mordaunt, said: “Actions to tackle the gender pay gap are good for business. That’s why we have produced support to help employers close their gaps.

“We recognise that in order to close the gap entirely we still need a much wider cultural change, that is why we have introduced a range of initiatives to tackle the drivers of the gap, including shared parental leave and spending around £6billion on childcare support.”

Over the past year, the Government Equalities Office (GEO) has been working with employers in several sectors to encourage them to put in place detailed and effective action plans to reduce their pay gap.

One of these is the retail sector which has a large number of female employees working in customer facing roles. The British Retail Council are working with their members, supported by GEO, to increase the opportunities for women to progress to more senior roles while retaining the flexibility that attracted them to the sector in the first place.

Companies that are taking positive action against their pay gaps, may still see their gap widen this year. This is because companies that are taking effective action to close their gender pay gap may be taking steps to hire more women, if these are in junior positions then it could see the average wage for women drop within that organisation. Likewise, a senior female leader could move on to another opportunity and that may cause a short term widening of the gap within that organisation.

If you would like more information about the issues raised in this article or any aspect of employment law, please contact Joanne Stronach on 01228 516 666 or you can email her here.