Susannah Donaldson

Analysis conducted by Pinsent Masons on the latest gender pay gap data provided by large UK companies shows some, albeit limited, progress in reducing gender pay practices but that gaps in many sectors also remain persistently high. In 2024-25, the average hourly median pay gap was 11.28 per cent, representing a decrease of almost 0.3 per cent from the data reported in 2023-24.
Overall, the proportion of women that hold positions in the top quartile of salary ranges has continued to rise, reaching 41.71 per cent in 2024-25. This continues the steady upward trend from 40.54 per cent in 2021, 41.07 per cent in 2022-23 and 41.38 per cent in 2023-24, suggesting gradual progress in improving representation at senior levels.

However, women make up a disproportionate share of lower-paid roles, accounting for 54.72 per cent of employees in the lowest paid quartile. While this is a slight decrease of 0.14 per cent from the previous year, it highlights that women remain overrepresented in lower-paid positions and there is still considerable work to be done to achieve true gender parity across all levels of the workforce.

Employers are not currently obligated to publish action plans outlining steps to address the gender pay gap, however the ERB introduces a new requirement for larger employers - those with 250 or more employees - to publish gender pay gap action plans. Menopause action plans will also address the needs of women affected by menopause in the workplace.

It is likely that employers will need to publish details of the specific measures they are taking to tackle gender pay disparities. These action plans hold potential to help close the gender pay gap, and employers and their stakeholders need to find ways to hold themselves accountable for successful implementation of the action plan by making it a key metric of business success.

Further developments across the UK and the EU signal a greater shift towards pay equity. Under the ERB, large employers will also be required to publish the identities of outsourced service providers.

Outsourced service sectors are often staffed by lower-paid and disproportionately female workers. The government believes that greater transparency will pass on accountability for pay gaps that exist in employer supply chains and motivate efforts to improve gender equality in organisations to which employers are linked.

Further legislative measures may follow as the government has also called for evidence on introducing equality measures to ensure that outsourcing cannot be used by employers to avoid paying equal pay. Outsourced workers may be able to draw equal pay comparisons with those working directly for the customer organisation.

In its call for evidence the government is also asking for views around mandatory pay transparency regulations to bring the UK more in line with the EU Pay Transparency Directive regime, which is regarded as the gold standard. Measures to improve pay transparency could involve employers publishing the specific salary or salary ranges of a job on the job advert or prior to interview and not asking candidates their salary history - which is intended to help women negotiate better salaries.

Susannah Donaldson is a partner at Pinsent Masons