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  • Overview

    What is gender pay gap reporting?

    Since April 2017, private and voluntary sector employers with 250 or more employees have been legally required to publish and report specific figures about their gender pay gap by the 4 April each year.

    Failure to publish and report the required gender pay gap information is a breach of the Equality Act 2010 and could result in enforcement action being taken by the Equality and Human Rights Commission.

    However, this year, gender pay gap enforcement action was suspended as a result of the pandemic and employers were given until 5 October 2021 to report their figures for 2020/2021.

    The results from the year 2020/2021 have now been published.

    What did the latest results reveal about the current gender pay gap?

    The Office for National Statistics (ONS) has encouraged people to focus on the longer-term trends rather than year on year changes due to the impact that Covid-19 had on the Average Weekly Earnings data. The ONS stated that the coronavirus pandemic had both an effect on the data (i.e. wages and hours worked in the economy) and also disrupted the collection of data from businesses. In this article, we will be examining the changes in the gender pay gap from 2019 to 2021.

    The data has revealed a decrease in the gender pay gap among full-time employees from 9.0% in 2019 to 7.9% in 2021. Among all employees, the gender pay gap has decreased from 17.4% in 2019 to 15.4% in 2021.

    However, there remains a large difference in the gender pay gap between employees aged 40 years and over and those aged below 40 years:

          Age-group       

                  Gender pay gap                 

    Percentage change in the gender pay gap

    2019

    2021

    18 to 21

    1.0%

    1.0%

    0%

    22 to 29

    2.0%

    0.9%

    -1.1%

    30 to 39

    1.8%

    3.0%

    +1.2%

    40 to 49

    11.4%

    12.3%

    +0.9%

    50 to 59

    16.4%

    12.3%

    -4.1%

    Over 60

    15.7%

    11.9%

    -3.8%

    Since 2019, the gender pay gap for full-time employees between the ages of 30 and 49 has actually increased. Although we have seen a decrease in the gender pay gap for employees 50 and over since 2019, there is still a significantly higher gender pay gap when compared to employees under the age of 40. Analysis by ONS in 2019, flagged a lower incidence of women moving into higher-paid managerial occupations after the age of 39 years, at which point pay in these occupations increase.

    The largest difference in pay between the sexes is among the higher earners and this has remained the case in 2021. From 2019 to 2021, there was an increase in the gender pay gap for all of the deciles.

    The managers, directors and senior officials occupation group has experienced the largest fall in gender pay gap, from 16.3% in 2019 to 10.2% in 2021. This could be an indication that more women are holding higher-paid managerial roles.

    The gender pay gap is higher in every English region than in Wales, Scotland and Northern Ireland. The English regions with the highest gender pay gap are the South East and London with both regions having a gender pay gap of 12.4%.

    What can employers do to close their gender pay gap?

    Gender pay gap reporting is a useful tool to shine the spotlight on the larger employers who are falling short in addressing their gender pay gap and to put pressure on them to take action to address the issue. However, all employers should strive to understand the gender pay gap in their companies and look to implementing solutions to lessen the effect.

    In 2017, the Government Equalities Office published six effective actions which were tested in real world settings and found to have a positive impact in reducing the gender pay gap:

    1. Include multiple women in shortlists for recruitment and promotions
    2. Use skill-based assessment tasks in recruitment
    3. Use structured interviews for recruitment and promotions
    4. Encourage salary negotiation by showing salary ranges
    5. Introduce transparency to promotion, pay and reward processes
    6. Appoint diversity managers and/or diversity task forces


    Employers should be aware that there is no “one size fits all” and addressing a gender pay gap requires tailored analysis to understand the gender pay gap in their company and creating an appropriate action plan.

    For further advice on how to close the gender pay gap in your business, please get in touch with our employment lawyers on 01892 510000 or email info@ts-p.co.uk

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