Gender pay gap update is widest at senior levels

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Research shows that the gender pay gap is widest at senior levels and in older age groups. The Government has confirmed that bonuses will be included in compulsory gender pay reporting and employers should check they are not exposed.

In our last newsletter we reported on forthcoming mandatory gender pay gap reporting. As yet, the draft Regulations have not been issued so it is not clear the exact form that the reporting requirement will take although the Government has confirmed that it will require employers with over 250 employees to include bonuses and other financial benefits/incentives in the pay analysis in addition to basic pay.

According to a recent study, the gender pay gap for women in full-time senior employment is higher now than it was in 2005. The pay gap also increases with age and whilst progress has been made on the pay gap for women in their 20s, 30s and 40s there has been little improvement for women in their 50s. In view of this, employers who are choosing to conduct voluntary pay audits in preparation for mandatory reporting later this year may wish to conduct specific analysis of any differentials between pay and reward amongst senior and older employees. Where gaps do exist it is important to understand the reasons for them and consider what justification would be relied upon in the event of a challenge.