The Office for National Statistics has now released information that the UK’s 2021 gender pay gap has grown since 2020 but remains smaller than it was in 2019.
What is the Gender Pay Gap?
The gender pay gap is calculated as the difference between average pay of men and women and is measured across all jobs in the UK. It is not the same as equal pay which relates to men and women being paid the same for doing the same work or work of an equal value.
What are the 2021 results?
In April 2021, the gender pay gap for full-time employees was 7.9%. This continues a downward trend since, while the gap was 7.0% in April 2020, it was 9.0% in April 2019. The data indicates that higher earners experience a larger difference in hourly pay between the sexes than lower-paid employees. Older workers are also affected as women aged between 40 and 49 who work full time experienced the highest gender pay gap at 12% while workers under 40 saw the lowest gap of 3%.
The ONS notes that comparisons with the data from 2020 need to be treated with caution given the impact of the COVID-19 pandemic on wages and hours worked and the disruption caused to the collection of data from businesses. The statistics relate to the pay period including 21 April 2021 when approximately 3.7 million employees were on furlough under the Coronavirus Job Retention Scheme (CJRS). However when the previous data was released in April 2020 approximately 8.8 million employees were furloughed. Commentators have indicated that the smaller gap in 2020 may have been a result of more men being on furlough (and therefore on 80 per cent pay) making the gap appear smaller.
How can employers reduce the gap?
There are effective ways in which employers can make a positive impact on the gender pay gap. Some actions that employers may wish to consider are as follows:
- Using skill-based assessment tasks in recruitment
- Using structured interviews for recruitment and promotions
- Encouraging salary negotiations by showing salary ranges
- Introducing transparency to promotion, pay and reward processes
- Appointing diversity managers and/or diversity task forces.
The results of the Gender Pay Gap have also highlighted concerns that measures are needed to protect mothers, given the pay gap increases after the age 40. Protections suggested include enhanced protection from redundancy, longer maternity leave and increased transparency from employers around flexible working options. Further actions that employers may therefore consider taking include improving workplace flexibility for men and women and encouraging uptake of shared parental leave.
For more information please contact a member of the Employment Team.