Gender Pay Gap in the UK: What to Expect in 2025

The gender pay gap has been an issue for years — and it’s not going anywhere anytime soon. That means as we head into 2025, pay equity is still in the spotlight. 

As companies look to create equitable workplaces, here’s what recent progress around the gender pay gap UK 2025 has looked like, including the current state of play, key factors to consider, and how HR professionals can work on closing the gap, for good. 

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Current State of the Gender Pay Gap in the UK

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In December, the UK government’s Valuation Office Agency (VOA) published its VOA Gender Pay Gap Report 2024. Some of the key gender pay gap analysis figures include: 

• Mean gender pay gap: 6.9%
• Median gender pay gap: 4.4%
• Mean bonus gap: 12.8%
• Median bonus gap: -100%

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The ideal pay gap is 0.0%, so for every data point except the median bonus gap — women are still paid less than men. But the good news is that the mean gender pay gap is decreasing: in 2023, this stood at 8.2%. 

Over the last decade, the gender pay gap in the UK has fallen by roughly a quarter. Despite this downward trend, consulting firm PwC estimates it will still take 45 years to close the UK’s gender pay gap. Compared to other countries, the UK still has a lot of work to do. It currently ranks 15th on the global gender gap index, behind European countries including Germany, Ireland, Spain, Lithuania, and Belgium. 

The Office for National Statistics found the gender pay gap in the UK is larger for employees over 40, and is also larger for higher-paid employees compared to lower-paid employees.  

Gender pay equity in the UK varies significantly across industries. Statista shows that the highest gap affects the financial and insurance sector, with women being paid 29.8% less than men. The gap is lowest in the accommodation and food services industry, at 2.1%. 

As UK companies work to close this gap, they first need to address some of the obstacles that stand in their way, including historical inequities, occupational segregation, biases, and budget constraints. 

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Key Factors Influencing the Gender Pay Gap in 2025

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In the UK, the gender pay gap is impacted by a range of factors. Here’s a rundown of some of the most important. 

Policy and legislation

Mandatory gender pay reporting for the UK was introduced in 2017. This helped drive accountability and change, by highlighting where pay gaps existed. But the process is currently limited, as companies with less than 100 employees don’t need to report their pay gaps. This means a large portion of the UK workforce isn’t included in current pay gap figures. 

Even when large gender pay gaps are identified, sanctions or fines aren’t enforced, meaning some companies don’t see the need to work on closing the gap.  

It’s possible that in 2025 and beyond, smaller organisations may be required to report their gender pay gap, and sanctions may be enforced for non-compliance. As yet though, there’s no new legislation covering either of these possibilities. 

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Diversity, Equity, and Inclusion in HR

Diversity, equity, inclusion, and belonging (DEIB) initiatives are helping highlight the gender pay gap, and helping companies wotk toward closing it. Practices including not asking interviewees about their salary history, using inclusive language, and expanding talent pools can all help companies work toward achieving pay equity. 

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Economic factors 

Closing the gender pay gap requires companies to address internal inequities — and this usually involves raising the pay of any employees who are affected. Of course, this requires additional funds, which aren’t always easily available.

Current economic conditions, including inflation and market instability, mean companies have to carefully balance their budgets. But, often the cost of not taking action, which can lead to increased employee turnover and damage to your company’s reputation, means that it’s worth trying to find the budget to address inequities as soon as possible. 

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Gender Pay Gap Reporting: What’s Expected in 2025?

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As we head into 2025, HR teams need to stay up to speed with how to report gender pay gaps at the companies they work for. Here’s what to expect.

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Evolving reporting requirements

The current threshold for companies required to report on the gender pay gap is 250 employees. This includes companies based in Great Britain with employees working outside the country. Part-time, seasonal workers, job-shares, and self-employed workers with a contract must all be included, but not agency workers.  

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Report deadlines are:

• 30th March: Most public authority employers
• 4th April: Other public authority employers, private, and voluntary employers

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It’s possible that in 2025, the threshold for reporting will be expanded to include smaller companies, although this hasn’t been confirmed yet.

To stay up to date with reporting requirements, follow the UK Government’s statutory guidance for employers.  

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Best practices for accurate reporting 

To make the reporting process easier, it’s worth creating standard processes and systems for data collection and analysis. Here’s what you need to do: 

• Determine which period corresponds with your snapshot data (either 31st March or 5th April, depending on which category of employer the company falls under).
• Gather payroll data for each employee, and include their gender. Things to include are each employee’s ordinary and bonus pay, plus their weekly working hours and hourly pay).
• Make your calculations (including the mean and median gender pay gap for hourly pay and bonus pay).
• If the company has more than 250 employees, report your data to the Government by the filing deadline. 

In addition to reporting your figures, it’s important to share them with your employees as well. This helps boost trust and transparency, helping employees feel informed about where gaps exist, and what you’re doing to close them. 

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Strategies for HR Professionals to Close the Gender Pay Gap by 2025

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Closing the gender pay gap is something that many companies are working towards in 2025 — here’s some strategies they’re using to make it a reality:

• Implementing pay audits and benchmarking: Regular pay audits help highlight any pay disparities, so they can be resolved. Benchmarking against industry standards ensures pay is aligned with market rates, helping companies set consistent, competitive salary bands for each role. 

• Prioritising pay transparency: Working towards increased transparency and equal pay in the UK helps companies create a culture of openness and trust. When employees feel informed about pay decisions, they’re more likely to remain committed and engaged. 

• Supporting career development and leadership opportunities: Women are often underrepresented in leadership roles, and strategies like career pathing, mentorship, and growth programs can help companies work towards supporting gender equity at senior leadership levels. 

• Using compensation technology: HR tech, like Figures, makes it far easier to monitor, analyse, and report on pay data that helps drive gender equity initiatives. 

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Case Studies: Organizations Leading the Way in Gender Pay Equity

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Want to know how companies in the UK are closing the gender pay gap? Here you go! 

Vodafone

While there’s still a mean pay gap of 9% at Vodafone UK, the company is bringing in plenty of HR strategies for pay equity to address this. The company approach is guided by its Fair Pay Principles and it completes annual reports on its gender pay gap. 

It’s also launched a wide range of programs designed to support women, for example, the Women In Business Network, a menopause toolkit, and its Change The Face Alliance. 

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Cisco

In 2023, Cisco’s UK branch reported a mean gender pay gap of 17.1%, down from 18.4% in 2022. The company promotes an open and transparent approach to pay equity, launching a strategic wellness partnership designed to support and empower women. 

It also offers the Women of Cisco’s Executive Shadow Programme, which is designed to facilitate personal and career growth by allowing employees to learn from its executive team.

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The Future of Gender Pay Equity in the UK: A Look Beyond 2025

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Gender equality in the workplace isn’t just something that HR professionals will be talking about in 2025 — its impact extends far beyond that. 

Looking to the future, companies in the UK can expect further legislative changes, for example, the reporting requirements being extended to include companies with less than 100 employees. Stricter penalties for non-compliance may also come into force, alongside a burden of proof for companies to demonstrate how they’re taking action to resolve pay inequities.  

And the best way to prepare for any potential changes? Stay up-to-date with the latest gender pay gap news, and conduct regular pay audits to highlight and address any disparities. 

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Committing to Gender Pay Equity as a Strategic HR Goal

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Knowing it could take 45 years to close the UK’s gender pay gap might feel a little discouraging — but the key to achieving this in less time is taking individual action. 

When companies view pay equity as not just a strategic goal, but an ethical priority, it creates a “north star” which influences every aspect of the business. This makes it easier to focus on what needs to happen across the entire organisation, from hiring and retention to performance reviews and pay benchmarking. 

Want to stay up to date with everything related to the gender pay gap? Sign up for our monthly compensation shot, for the latest news and insights.

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