The headline from the most recent gender pay gap report from The Office of National Statistics confirms the continuation of the decade long downward trend in the gender pay gap. That sounds like good news, but the reduction of the gap is not consistent across all categories of employees, and, in some categories, the gap has actually increased.
Looking behind the headline figures:
- The gender pay gap for full-time employees has reduced to 7% as of April 2024 from 7.5% in 2023. However, median hourly earnings excluding over time remain higher for men than for women among full-time employees.
- The largest gap is between employees aged 40 and over and amongst high earners.
- For those aged 50 to 59 years, the gap has increased since 2023 from 11.1% to 12.1%.
- Full-time employees in the 90th percentile of earners have a pay gap of 15.5%, an increase of 0.6% since 2023. This can be compared with a pay gap of 7.1% for median earners and 2.7% for employees in the 10th percentile of earners.
- All English regions have a higher pay gap than in Northern Ireland, Scotland and Wales.
Interestingly, yet maybe unsurprisingly, the report has stated that women are more likely than men to accept lower pay in favour of a shorter commute. This could be for a multitude of reasons, but the assumption is that this is due to the fact that women remain the primary caregivers for children. This inevitably has a knock-on effect for the number of women moving into managerial positions which will increase the gender pay gap in those categories - as we have seen from the data this year.
Where do we go from here?
The recent introduction of the Employment Rights Bill has indicated that future regulations will require employers with 250 employees or more to develop and publish equality action plans. These action plans will show what steps are being taken in relation to gender equality, including the gender pay gap. The anticipated regulations will extend the existing requirement for gender pay gap information to be published by asking employers to specify how they intend to address that gap, alongside other gender equality issues. Enforcement measures are also expected, with the regulations likely to set out how failure to comply will be enforced. The government is consulting with the Equality and Human Rights Commission on the contents of the regulations before they are due to be published.
These equality action plans address one of the major criticisms of the 2017 gender pay gap reporting requirements. The explanatory notes of the Employment Rights Bill state that as at June 2019, only half of reporting employers had published an action plan detailing the steps they were taking to address their gender pay gap. The effect these new action plans will have in creating real change remains to be seen. It will be a few years before we see whether the plans make any impact on the figures (they are unlikely to be legislated before 2026) but this does seem like a step in the right direction…
