The deadline for UK gender pay gap reporting is fast approaching. Employers with 250 or more employees must submit their reports by March 31, 2025 (public sector) and April 4, 2025 (private and voluntary sector).
Failing to comply can result in reputational damage and regulatory scrutiny.
Why This Matters
The UK’s gender pay gap reporting requirements are designed to increase pay transparency and hold employers accountable for inequities in compensation. Organizations that fail to meet the deadline risk public scrutiny, reputational harm, and potential enforcement actions. Beyond compliance, gender pay gap reporting is a crucial opportunity for companies to demonstrate their commitment to unbiased and legally defensible pay practices.
With growing expectations for pay transparency worldwide — and anticipated expansions to include race, ethnicity, and disability pay gap reporting — businesses must take action now to ensure compliance and prepare for future regulatory changes.
What Employers Must Do Now
To meet the reporting deadline requirement for 2025, organizations must:
- Calculate their gender pay gap metrics from 2024, including:
- Mean and median gender pay gaps
- Bonus pay gaps
- Bonus participation rates
- Pay quartile distributions
- Submit their report to the UK government’s Gender Pay Gap Service.
- Publish the report on their company website with an executive statement explaining the findings and any actions being taken to address disparities.
Organizations should not wait until the last minute to complete their reporting. Gathering the necessary data, ensuring accuracy, and crafting a meaningful narrative around the findings require time and attention to detail.
The Risks of Non-Compliance
Failing to report or submitting inaccurate data can have significant consequences:
- Reputational Damage: Pay gap data is public, and failure to comply — or reporting a significant gap without an action plan — can harm an organization’s employer brand, affecting talent acquisition and retention.
- Regulatory Scrutiny: The Equality and Human Rights Commission (EHRC) has the authority to investigate and enforce compliance, including legal action for non-reporting.
- Employee Trust and Morale: Transparency is key to fostering trust. If employees perceive that their employer is failing to address pay equity, it can lead to dissatisfaction and decreased engagement.
The Labour Party has made it clear it intends to hold employers accountable for failing to comply with laws such as the gender pay gap reporting requirement. And it will become increasingly important for UK employers to ensure their pay practices are aligned with the country’s equal pay laws.
Anticipated Expansions: Are You Ready for Future Pay Gap Reporting Requirements?
The UK government is considering expanding pay gap reporting beyond gender to include race, ethnicity, and disability. This follows a broader global trend, with regulations like the EU Pay Transparency Directive and similar initiatives gaining traction worldwide.
Employers should begin preparing now by:
- Collecting workforce demographic data in a compliant and ethical manner.
- Conducting intersectional pay equity analyses to identify disparities across multiple demographic groups.
- Implementing action plans to address pay gaps before reporting expands.
Proactively addressing pay inequities today will position organizations for future compliance.
Avoid Errors and Compliance Risks
Inaccurate reporting can lead to regulatory action. Organizations must ensure they:
- Collect accurate data from HR and payroll systems.
- Validate pay calculations to prevent errors.
- Address any significant gaps with a clear action plan.
Additionally, companies should assess the root causes of any inequities. Are there systemic barriers to promotions? Are bonus structures equitable? A robust pay equity analysis can provide these insights and help employers take meaningful action beyond simply reporting the numbers.
How Trusaic Simplifies Compliance
Navigating gender pay gap reporting can be complex, but Trusaic’s solutions make compliance seamless and stress-free. Our three-pronged approach is a cut above other solutions:
- Leverage PayParity® to understand, explain, and resolve pay inequities across gender, race, age, and more. Conduct proactive or compliance-driven analyses to pinpoint disparities, reduce legal risk, and build trust by ensuring fair, transparent pay practices across your workforce. And now, with R.O.S.A., you can optimize your remediation budget so you can make every pay adjustment count.
- Leverage the Regulatory Pay Transparency Reporting™ solution to confidently report and comply with gender pay gap reporting requirements like the UK’s.
- Leverage our Pay Equity product suite to communicate narratives and share salary ranges with confidence. Communicate the sources of your pay gaps, progress objectives, and enhance trust with stakeholders.
Learn more about how our robust methodology simplifies pay equity and guides you to make compliant pay decisions with ease.
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