UK companies have struggled to close the gender pay gap, with more than three-quarters of British businesses (78%) paying men more than women, according to the latest data published by the government’s gender pay gap service.
All employers with 250 staff or more are legally required to publish data on their gender pay gaps. Although some employers missed last week’s reporting deadline, the new data reveals that the UK’s median hourly gender pay gap for the 2024-25 period is 8.6%, down marginally from last year’s 8.95%.
Deeba Syed is head of policy at The Fawcett Society, a charity that campaigns for gender equality. She says employers have not taken sufficient action to close the gender pay gap since reporting first became mandatory in 2017.
“For too long women, and particularly Black and minority women, have been undervalued or held back because of a labour market that prioritises men,” Syed says. She wants to see gender pay gap reporting extended to all UK employers and an additional requirement for companies to publish binding action plans detailing how they will close the gap.
Among the country’s largest employers, with 20,000 staff or more, the median hourly gender pay gap is 5.5% – one percentage point lower than last year’s 6.55% and narrower than the median for all UK companies.
Banks report largest pay gaps
However, there is much variation across industries. Financial services companies and banks are outliers among the UK’s largest employers, with many failing to close the sizable pay difference between their male and female employees.
Dr Michelle Tessaro, visiting professor at Cranfield School of Management and a specialist in gender equity, says: “The easy wins have already happened. Companies must now tackle the structural problems within workplaces, particularly job segregation, which are harder to address. Banks are illustrative of this job-segregation issue; there is a lack of women in the most senior, high-paying roles.”
Lloyds Banking Group, which owns Lloyds Bank, Halifax, Bank of Scotland and Scottish Widows, among others, reported a median hourly gender pay gap of 35.5%, representing a 2.7 percentage point increase on last year’s figure.
Although the banking group admits that it has much work to do to address the pay imbalance, it claims to have made efforts to increase the number of women in senior roles and attract and develop female talent. Plus, the group’s mean gender pay gap has fallen slightly from 26.7% to 25.9% in the past year.
Of the group’s subsidiaries, Lloyds Bank fared the worst, reporting a gender pay gap of 39.2%. The bank has the widest median gender pay gap of any UK business with more than 20,000 employees.
Santander, NatWest and Barclays Execution Services (a Barclays subsidiary) also reported median gender pay gaps in excess of 20%.
Structural challenges in the finance industry
A challenge with closing the gender pay gap in the finance industry is that men are disproportionately represented in the highest-paying roles. At NatWest, for example, men occupy two-thirds of roles with the highest hourly pay. Meanwhile, 68.1% of the lowest-paid jobs are held by women.
For too long women have been undervalued because of a labour market that prioritises men
“We know too many women don’t make it to senior roles in this sector – not because they aren’t capable but because of workplace cultures that conspire against them, working policies that don’t support them and a childcare system that is, at best, dysfunctional,” Syed says.
Bonus pay also tends to be unevenly distributed, with women at NatWest receiving 40p for every £1 paid to men.
Santander claims that its gender pay gap is reflective of “the structural makeup of our organisation” and notes that the difference in pay between male and female employees has improved as more women have progressed into senior roles. It adds that the gender balance in customer-facing positions has improved.
Reaffirming the bank’s commitment to inclusion, a spokesperson for Santander says the firm is “investing in long-term, systemic change – creating more opportunities for women to move into leadership and ensuring our culture, policies and practices actively support that ambition”.
Closing the gap
Some companies have made better progress to close their gender pay gaps. British Airways had one of the widest median gender pay gaps in 2024, at 37%. However, it has managed to reduce this by 10 percentage points over the past 12 months.
The airline claims that its gender pay gap is largely driven by an under-representation of women in pilot and engineering roles, which tend to be higher paid, and an over-representation of women in cabin-crew roles. It says this issue will require “ongoing, long-term efforts to transform”.
Efforts to improve leadership training and career development programmes, as well as broader inclusion initiatives, have helped British Airways close its pay gap. Four in 10 of the firm’s senior leadership roles now occupied by women.
The gender pay gap won’t go away on its own. We need concerted action and we need it quickly
Asda, Aldi and TJX UK, which owns the TK Maxx brand, have also made progress to close their median gender pay gaps, as has PwC, which reduced its pay gap from 4.2% to 2%.
Despite the progress, campaigners such as The Fawcett Society are calling for more action to eliminate the pay disparities between men and women. Syed says: “The gender pay gap won’t go away on its own, and if [UK chancellor] Rachel Reeves is going to deliver on her promise to close it once and for all, we need concerted action and we need it quickly.”
The backlash against DEI programmes is a serious threat to achieving gender pay parity, according to Tessaro. “We’ve lost our way a little bit. The push for having women in leadership, while definitely a fairness and social-justice issue, was really about reducing group think, improving decision-making and driving better business results.”
Companies that fail to address the structural problems preventing women from reaching the most senior levels may find themselves at a disadvantage. Tessaro adds: “It’s interesting that, in an economy facing an aging workforce, declining birth rates and tighter immigration policies, many companies continue to overlook about half of the talent pool when it comes to development and progression, especially in senior leadership jobs.”
So the ethical issues presented by gender pay disparities may fail to convince business leaders of the importance of fairer pay practices. But the broader business implications could compel more companies to close their gender pay gaps more swiftly.
UK companies have struggled to close the gender pay gap, with more than three-quarters of British businesses (78%) paying men more than women, according to the latest data published by the government’s gender pay gap service.
All employers with 250 staff or more are legally required to publish data on their gender pay gaps. Although some employers missed last week's reporting deadline, the new data reveals that the UK’s median hourly gender pay gap for the 2024-25 period is 8.6%, down marginally from last year’s 8.95%.
Deeba Syed is head of policy at The Fawcett Society, a charity that campaigns for gender equality. She says employers have not taken sufficient action to close the gender pay gap since reporting first became mandatory in 2017.
