Let’s talk about equal pay

Under the Equality Act 2010 there’s a legal obligation for employers to make sure they offer equal pay for equal work.

Why is equal pay so important?

According to a report released by the UK Government in 2024, 79% of employers stated the median hourly pay was higher for men than women in their organisation between 2022/23. Meaning we still have a ways to go before true equality…

This data is based on the difference in pay between middle-ranking women and middle-ranking men, the so-called "median" pay gap. This median pay gap was 7.7% less for full-time women than men in April 2023.

Reporting and understanding equal pay is crucial for employers to help promote workplace equality, ensure fair pay practices, and remain on the right side of the law.

While the gender pay gap often receives the most attention, it’s important to recognise that pay disparities can also affect young people, people from different ethnic backgrounds, and individuals with disabilities too.

What does the law say about equal pay?

In the UK, the law says men and women must be paid the same for equal work under the Equality Act 2010. This legislation means that employees performing the same job or work of equal value receive equal pay regardless of gender.

Since April 2017, companies with 250 or more employees have to publish data on their gender pay gap to promote transparency and fairness.

You’re also required to offer equal contractual terms and conditions, like annual leave allowance, benefits, and performance-based bonuses.

Labour also wants to go further by making it mandatory for companies with 250+ employees to report on ethnicity and disability pay gaps. They’re also committed to strengthening laws on gender pay discrepancies by making business owners with 250+ employees create action plans to address any pay differences.

Labour are also proposing a gradual phasing out of the National Minimum Wage (NMW) age bandings which means employers will pay 18–22 year-olds less than those aged 23 and over. When these changes come into effect, you’ll need to make sure your payroll system accounts for the new minimum wage, or you may be liable for fines and prosecution.

For more information about Labour’s upcoming changes and the impact on your business, download our FREE impact assessment guide.

How can my business remain on the right side of the law?

As a business owner, it can be difficult to know what protections you need to put in place to make sure your staff are paid and treated fairly.

To reduce your legal risks, it’s best practice to:

• Set out an equal pay policy to protect your staff and business

• Ensure your job descriptions are up-to-date and accurate

• Check that your job titles are the same, no matter the gender of your employee

• Provide better training for hiring staff to reduce pay discrimination

• Use a salary calculator tool to keep your pay offering equal and at a market rate

• Promote pay transparency to build trust and help close the gender pay gap

Failing to follow the law on equal pay could land your business in an employment tribunal. In this scenario, it’s best to seek expert advice.

But equal pay isn’t just important for legal reasons—paying staff fairly in your business keeps your reputation squeaky clean, motivates staff, and forms a key pillar of your social responsibility and culture. All of these are essentials for most job seekers, helping you attract and retain top talent.

Need more support from BrightHR?

Keeping on top of evolving rules about equal pay can be difficult, but there is an easier way! Speak to one of our friendly experts to see how BrightHR can support you with ready-made templates, guides, documents, and 24/7 advice.

Book a free demo today, or call 0800 470 2432.

Or, for instant answers on over 11,000 HR and health & safety questions, feel free to ask our superfast AI tool Bright Brainbox: ‘Who has the right to equal pay?’