Navigating Gender Pay Gap Reporting Compliance

Key points:

• Reporting requirements are expanding rapidly: UK mandates apply to 250+ employee companies, Ireland lowered to 150+, and the EU directive launches in 2026 with more comprehensive metrics and ongoing compliance obligations.
• Foundation work prevents costly errors: Establish cross-functional teams early, audit HRIS access permissions months ahead, and create employee classification matrices to handle edge cases consistently.
• Strategic communication beats corporate deflection: Pre-announce to employees with context, equip managers with consistent messaging, and avoid generic excuses.
• Voluntary reporting creates competitive advantages: Early transparency attracts top talent, builds trust, and positions you as a leader.
• Systematic monitoring replaces annual panic: Quarterly reviews with leadership accountability, real-time gap tracking, and automated compliance tools make reporting easier.

Your gender pay gap calculations are finally done. The tabs are closed, the data is clean, and your numbers look reasonable.

Now comes the real challenge: reporting.

It’s not as easy as just uploading numbers to a government portal. You're navigating complex requirements, deadlines, and stakeholder communications that can affect your reputation. One misclassified bonus payment or missed deadline can turn a routine compliance exercise into a boardroom crisis.

The stakes might be high, but there’s a golden opportunity that’s often ignored by companies, which treat gender pay gap reporting simply as a compliance requirement. Namely, that you can promote your business’s organisational structure, progression opportunities, and dedication to transparency, all of which can give you a huge leg up when searching for new talent.

While reporting can be your company’s strength, it can still be a confusing process, especially with the new EU Pay Transparency Directive arriving in 2026. But with our guide, you'll learn to navigate requirements with precision, communicate findings effectively, and turn compliance into a competitive advantage.

The current landscape of gender pay gap reporting requirements

Gender pay gap reporting is the practice of organisations publishing data on the difference in average pay between male and female employees. It highlights the extent of gender-based pay disparities and encourages organisations to address root causes. It also empowers employees to identify and challenge unfair pay.

As they should, considering how widespread the issue is.

For instance, according to 2024 data from the government's gender pay gap service, 78% of UK companies pay men more than women. Let's be honest, this isn't just a statistic – it's a systemic failure. Before mandatory reporting, companies could quietly ignore pay disparities. That’s much harder to do when they must publish their gaps publicly every year.

Reporting requirements across Europe

Regulations vary significantly across Europe:

United Kingdom

Companies with 250 or more employees must report annually. The snapshot date falls on April 5th for most organisations, though some sectors use March 30th.

Ireland

Recently lowered the threshold to 150+ employees, catching many mid-sized companies off guard.

European Union:

The Pay Transparency Directive takes effect in 2026 for different companies, and each country has to set thresholds based on that. France, for example, will most likely have a minimum threshold of 50 employees.

Regardless of where you are in Europe, make sure to take a look at your country’s regulations, as they may set thresholds lower than the directive requirements. France, for instance, has a threshold of just 50 employees (go France!!!). 

While we’re at it, here’s a quick note on snapshot dates and some peculiarities that might trip some HR teams up:

• Include employees who were on your payroll on the snapshot date, even if they started that morning.
• Exclude employees who started the day after the snapshot date, regardless of when you processed their paperwork.

Edge case example: An employee left on March 30th but received their final pay in April. Include them if they received March pay during the snapshot period.

What must be reported

The specific metrics you'll need to include in your gender pay gap calculations and what you need to publish vary by jurisdiction, but certain elements appear consistently across reporting frameworks.

UK requirements

Four core metrics form the foundation of UK gender pay gap reporting:

• Mean and median gender pay gaps show different perspectives on your pay distribution. The mean reveals how executive salaries skew your overall picture, while the median shows your typical employee experience.
• Bonus gaps capture variable compensation differences. This includes everything from quarterly sales commissions to annual performance bonuses.
• Quartile distributions demonstrate how men and women are represented across your pay bands. You'll divide all employees into four equal groups and show the gender split in each.

UK pay classifications

Getting these categories right prevents expensive reporting errors.

Ordinary pay includes:

• Monthly car allowances.
• Shift premiums.
• Regular overtime payments.
• Any predictable, recurring compensation.

Bonus pay includes:

• Quarterly commissions.
• Annual performance bonuses.
• Profit-sharing distributions.
• One-off recognition payments.

💡Pro tip: Get all your ducks in a row before submission by ensuring every allowance is classified correctly. Misclassifying regular allowances as bonuses artificially inflates your bonus gaps. That monthly car allowance showing up in the wrong category? It'll skew your data and raise uncomfortable questions from regulators. 

EU requirements (from 2026)

The EU Pay Transparency Directive introduces a more comprehensive reporting framework. Companies will need to track seven distinct metrics:

1. (a) Gender pay gap (mean)
2. (b) Gender pay gap in complementary or variable components
3. (c) Median gender pay gap
4. (d) Median gender pay gap in complementary or variable components
5. (e) Proportion of female and male workers receiving complementary or variable components
6. (f) Proportion of female and male workers in each quartile pay band
7. (g) Gender pay gap by categories of workers (broken down by ordinary basic wage/salary and complementary or variable components)

🧐 Items (a) through (f) must be made publicly available. Item (g) remains internal only, though employees can request access to this data.

For those companies that have employees in both the EU and the UK, remember that the EU uses different terminology to the UK system:

"Ordinary basic wage or salary" replaces the UK's "ordinary pay" concept.

"Complementary or variable components" appears broader than the UK's "bonus" definition, potentially capturing more types of variable compensation.

This expanded scope means payments you currently classify as ordinary might become variable under EU rules.

Additional EU compliance requirements

• The 5% trigger: Pay gaps exceeding 5% require joint pay assessments with worker representatives. This isn't optional – it's automatic.
• Management accountability: Leadership must confirm data accuracy after consulting worker representatives. No more solo sign-offs.
• Remediation timelines: Unjustified gaps must be addressed within "reasonable timeframes." Vague language that will likely spark disputes.
• Employee rights: Workers can request additional clarifications, and you must provide substantiated replies. This creates ongoing compliance obligations beyond annual reporting.
• Penalties vary by country: The directive requires "effective, proportionate and dissuasive" fines but leaves the amounts to member states. However, the reputational damage from reporting errors far exceeds any fine you might have to pay. 

From data to disclosure: building your reporting framework

Moving from requirements to results requires systematic planning. Most companies approach gender pay gap reporting reactively, scrambling to meet deadlines with whatever data they can gather. This creates unnecessary stress and avoidable errors.

You need to be proactive, and here’s how:

1. Foundation phase

Establish your reporting team early. This isn't a solo HR project – you'll need finance for payroll data, legal for compliance guidance, and communications for stakeholder communication.

Then, map out multi-country deadlines on a shared calendar. If you're reporting in multiple jurisdictions, overlapping requirements can create chaos without proper coordination.

Most importantly, give yourself plenty of time. Companies scrambling in March for April deadlines are setting themselves up for errors. It’s like buying your Mum a bouquet of flowers from the local petrol station on Christmas Eve because you didn’t want to go earlier. The best reporting (much like Christmas shopping) happens when you're not racing against the clock.

To help you with that, audit HRIS access permissions well in advance. Nothing derails a project faster than discovering you can't extract the data you need. Test your access months before the snapshot date, not days.

Next, you need an employee classification matrix, which will help you make decisions when you have specific edge cases. In there, you should include fixed-term contract employees, staff on paid leave during the snapshot period, and international secondees, if they're on your UK payroll.

What you shouldn’t include is external consultants, zero-hour workers without pay in the relevant period, and contractors who invoice rather than receive payroll.

To make this even easier, build calculation templates with automatic classification. Your template should categorise ordinary versus bonus pay automatically based on predefined rules. This is a much easier option than manual classification, which often leads to inconsistencies and mistakes that auditors will find.

2. Testing phase

Run mock calculations using your previous year's data. This acts as your safety net, revealing data quirks, system limitations, and calculation errors before they become public embarrassments.

Next, validate your results against known benchmarks and industry norms. While benchmarking, you’ll need to go over a few basic validation checks: 

• Sanity check: Is your mean gap larger than your median? This is common and expected – executive salaries skew the mean upward, while the median shows your typical employee experience.
• Headcount match: Does your total employee count in calculations equal your actual payroll headcount? Mismatches reveal classification errors.
• Quartile test: Each quartile should contain exactly 25% of total employees. Do male and female percentages within each quartile equal 100%? Basic maths, but easy to get wrong.
• Year-over-year comparison: Did your gap change by more than 5%? You'll need to explain significant shifts to stakeholders who assume gaps should remain stable.
• Bonus recipient verification: Does the number of employees receiving bonuses match your payroll records? Discrepancies often reveal classification mistakes.

Test the government portal uploads with dummy data. Many portals have specific formatting requirements that aren't obvious until you try uploading. Better to discover these quirks during testing than be caught with your trousers down on deadline day.

Document any data gaps or system limitations you discover. These notes become invaluable when explaining anomalies to leadership or regulators.

 💡Quick tip: Quarterly data reviews prevent year-end surprises. Treat your annual calculation as a summary, not a discovery process.

3. Pre-snapshot preparation

• Clean your payroll data before the snapshot date. Fix obvious errors, resolve duplicate records, and ensure job titles align with your classification matrix.
• Minimise organisational changes near the snapshot date. That restructure can wait a month if it prevents data complications. It’s also a good idea to brief managers on snapshot date implications. Last-minute hiring, promotions, or terminations can significantly impact your numbers if timed poorly.
• Schedule your post-snapshot communications in advance. You'll be busy calculating after the snapshot – prepare your messaging strategy in advance. 
• Finalise your internal FAQ document. Employees will have questions about the process and results. Consistent answers prevent confusion.

4. Execution and submission

You did it, it’s finally time! The real HR Christmas: submission day! 

So, what actually happens? 

First, lock all payroll records immediately after the snapshot date. No exceptions, no last-minute adjustments. Then, calculate and validate your figures using the templates and checks you've already tested. 

After that, leadership has to review and sign off on the narrative internally. However, you also need someone senior to own these numbers publicly. Make sure they understand what they're approving. Once that’s done, submit to the government portal and publish on your company website. 

The UK requires both – portal submission isn't enough. You have up to 12 months from the snapshot date to publish. This isn't an immediate deadline, so don't rush into errors. You’ll also need to keep published data accessible for a minimum of three years, so plan your website structure accordingly.

While companies in the EU have no obligations to publish gender pay gap reports on their websites, it’s still a good idea to do so. It will help foster a sense of trust in your business, benefiting both employees and investors. 

Navigating stakeholder communications without the corporate speak

Your numbers are final, your calculations are validated, and your data is ready for submission. Now comes the part that separates confident leaders from those who hide behind jargon: communicating your results.

Most organisations approach these conversations reactively, thinking of answers only after uncomfortable questions arise. This defensive posture makes every interaction feel like damage control. 

🗣 Our advice? Get all your ducks in a row beforehand by developing a strategy for both internal and external communications.  

Internal communications strategy

Start with a pre-announcement to employees. Provide context about the process, timeline, and what the results mean. Context prevents speculation; excuses fuel it.

Your message should explain why you're reporting, what you're measuring, and when results will be available. Avoid the temptation to pre-justify unfavourable numbers.

You should also create manager briefing packs, because they’ll probably face questions directly from their teams. Equip them with consistent answers about the process, methodology, and next steps. Nothing undermines confidence faster than managers giving conflicting explanations.

The reality is, employees will find your data anyway. Having a strategy to fall back on enables you to control the narrative before others do it for you.

✅ External messaging that builds trust

• Media statements should acknowledge reality. If your gap exists, own it. If it's improving, show the trend. If you're taking action, be specific about what and when.
• Investor communications work best when linking equity to performance. Connect pay equity initiatives to business outcomes like talent retention, innovation, and market reputation.
• Customer-facing transparency is expected. Your clients, especially larger enterprises, want to work with organisations that reflect their values. Pay equity becomes part of your competitive positioning.

🚫 Bad excuses

• "Our gap is due to more men in senior roles." One of the reasons that the gender pay gap exists is that women hit a glass ceiling and can’t progress to senior roles.
• "We value diversity." Empty words without concrete actions. Show us your promotion rates, retention programs, and leadership development initiatives.
• Complex statistical justifications. Numbers can muddy the water and make it difficult for non-statisticians to understand what you’re trying to say. At best, it can make your reasons seem incomprehensible; at worst, a pure deflection. 

Beyond compliance: strategic opportunities in gender pay gap reporting

Treating gender pay gap reporting as pure compliance misses significant strategic opportunities. Forward-thinking organisations use reporting cycles to drive meaningful change, gather competitive intelligence, and position themselves as employers of choice.

Using reporting cycles to drive change

Reporting cycles are usually done annually, but that often leads to panic and can sometimes be rushed because there’s so much to get through – like cramming for an exam you forgot existed until the night before. We recommend implementing quarterly reviews with leadership accountability because it creates sustained progress and prevents surprise revelations.

You can also make pay equity metrics part of leadership scorecards and set department-level targets tied to bonuses. When their variable compensation depends on improving their team's pay equity, progress naturally follows.

The goal here isn’t to punish managers for historical gaps, but to reward those who actively address them through strategic hiring, promotion practices, and compensation reviews.

Competitive intelligence from public data

• Benchmark against direct competitors. If you're at 8%, that's still a gap requiring action – but if you're actively closing it year after year while your main competitors stagnate at 15%, that's a talent acquisition talking point.
• Identify talent acquisition opportunities. Competitors with widening gaps often have disengaged female talent ready to move.
• Predict competitor vulnerabilities. Companies with poor pay equity metrics face higher recruitment costs, retention challenges, and reputation risks.

Voluntary reporting as a strategic advantage

Voluntary reporting is transparency that shows confidence in your compensation practices and commitment to equity. Smart candidates often evaluate potential employers based on demonstrated values, not stated intentions (e.g., those empty slogans “We’re a family here!”).

So, when you get ahead of regulations, you position yourself as a leader rather than a follower.

How Figures transforms reporting compliance into a competitive advantage

The manual processes most organisations use for gender pay gap reporting consume weeks of HR time but deliver minimal strategic value. Spreadsheet calculations, data validation headaches, and last-minute compliance scrambles become annual traditions nobody enjoys.

Figures make these processes a walk in the park. On a sunny day. With your favourite coffee.

Our pay equity module is designed specifically to handle UK reporting and upcoming EU requirements. For example, the Figures Pay Gap Reports help you get ahead of upcoming EU and national laws, with compliant report templates and proactive gap detection. From gender pay gaps with advanced filtering options to individual risk detection, the module helps you communicate internally and generate custom reports.

All of these tools will make continuous monitoring much easier and prevent year-end surprises. Instead of discovering problems during annual calculations, you spot trends as they develop and address issues before they impact your public reporting.

"Most HR teams spend weeks preparing reports that take regulators minutes to review. Figures flips that equation – minutes to prepare, weeks to act on insights," explains Virgile Raingeard, CEO at Figures.

The platform delivers portal-ready export formats for statutory reporting, real-time pay gap monitoring beyond annual snapshots, pre-built templates for employee information requests, and automated insights from existing HRIS data.

“Transparency here is already important, but now our teams can see that we’re looking to be competitive and are able to see that we’re benchmarking against other companies. We’re also able to share the analysis around the gender pay gap and how that’s broken down between management and practices.  I think that’s super helpful and shows that as a business we care about those scores and that it’s something we’re focusing on," shares Sophie, People Lead at Planes.

Transform your approach to pay equity with Figures

Reporting is the start of the conversation, not the end. The real value shows when you move beyond compliance to change how your organisation thinks about pay equity.

Your choice is simple: continue scrambling annually with spreadsheets and manual processes, or build systematic excellence that positions pay equity as a competitive advantage.

The organisations that will struggle in five years are those still treating this as a compliance burden. They'll compete for talent against companies that embraced transparency early, built trust through consistent action, and positioned equity as a core business value.

Excited to see how Figures can improve your next reporting cycle?  Book your free demo and discover why forward-thinking HR leaders choose systematic excellence over annual scrambling.

For additional insights on navigating the world of pay transparency, explore our other resources:

• Gender Pay Gap and Pay Transparency eBook – Strategic guidance for building transparent compensation practices.
• EU Pay Transparency Directive Checklist – Step-by-step preparation guide for 2026 requirements.