TL;DR

The gender pay gap is the difference between the median earnings of men and women across an organisation or economy, expressed as a percentage of male earnings. It is distinct from unequal pay for equal work, which is a legal violation. The gap reflects occupational segregation, seniority distribution, and career interruption patterns. UK employers with 250 or more employees must report their gap annually.

What the Gender Pay Gap Measures

The gender pay gap and equal pay are not the same thing, and conflating them is a common mistake. Equal pay law, in the UK enshrined in the Equality Act 2010, requires that men and women doing the same or equivalent work receive the same pay. Paying a female accountant £5,000 less than a male accountant in the same role is unlawful. The gender pay gap is different: it is a population-level statistic that compares median earnings across all male and all female employees in an organisation, regardless of role.

An organisation can fully comply with equal pay law and still have a large gender pay gap. If 80% of senior roles are held by men and 60% of junior or part-time roles are held by women, the median female salary will be substantially lower than the median male salary, even if every person in every role is paid identically to their same-role peers. This distinction matters because it changes what interventions actually address the problem. Equal pay audits check whether people in the same role are paid the same. Closing the gender pay gap requires changing the distribution of roles.

The UK's gender pay gap reporting regulations, introduced under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, require employers with 250 or more employees to publish six specific figures annually: median pay gap, mean pay gap, median bonus gap, mean bonus gap, proportion of men and women receiving bonuses, and proportion of men and women in each pay quartile. The mean gap is sensitive to high earners and is typically larger than the median. The quartile distribution is often the most revealing figure because it shows where in the organisation women are concentrated.

Why It Matters for Recruitment

Recruiters sit directly inside the mechanisms that produce the gender pay gap. Sourcing, shortlisting, offer-making, and salary negotiation are all points where gap-widening choices happen, often without deliberate intent. When recruiters anchor salary offers on a candidate's previous earnings, they perpetuate any historical underpayment. When they source primarily from existing networks skewed toward men in senior roles, they reproduce the pipeline problem that creates the gap in the first place.

For agency recruiters, gender pay gap data published by clients is an intelligence source. An organisation with a large mean gap concentrated in the upper pay quartile is telling you that senior roles are male-dominated. This has implications for where you source for mid-senior mandates (diverse sources required), how you position the role to female candidates (they may need reassurance the organisation is actively improving), and how you handle salary discussions (anchoring on market rates rather than candidate history).

For in-house teams, the pay gap report is both a compliance output and a diagnostic tool. The quartile data shows exactly where the distribution problem is concentrated. If the upper-middle quartile is 55% male and the lower-middle is 65% female, the intervention needs to target mid-career progression, not graduate intake or C-suite diversity. Recruiting teams can influence this by specifically building diverse shortlists for roles at the levels where the gap is steepest.

In Practice

A retail chain with 3,400 employees publishes its gender pay gap report and finds a median gap of 18.4% in favour of men. The mean gap is 24.6%. Breaking down the quartile data: lower quartile is 62% female, lower-middle is 58% female, upper-middle is 44% female, and upper quartile is 31% female.

The data tells a specific story: women are well-represented in junior and lower-mid roles but drop out significantly at the upper-middle to senior transition. The likely mechanism is that store manager and area manager roles, which sit in the upper-middle quartile, are predominantly filled by men. The company has been promoting internally from a pool that skews male because the informal networks for promotion (weekend management meetups, visibility with regional directors) have historically excluded part-time workers, 78% of whom are women.

The recruitment team designs an intervention: for all store manager and area manager vacancies, they build shortlists that are at least 50% female, they stop using referrals as the primary sourcing method, and they introduce structured promotion interviews with blind scoring. Within 18 months, the upper-middle quartile reaches 49% female, and the median pay gap drops to 13.1%.

Key Facts