How the gender pay gap is calculated (with examples)
Every spring, thousands of UK employers publish a single percentage that is meant to sum up how fairly they pay women and men. It gets quoted in headlines and LinkedIn posts, often with very little agreement on what it actually measures. So before you judge a company by its number, it helps to understand how the gender pay gap is calculated, and what the figure can and cannot tell you.
The short version: it is an average, not a like-for-like comparison. Once you see the maths, the debates around it make a lot more sense.
The gender pay gap is not the same as equal pay
This is the confusion that trips almost everyone up. Equal pay is a legal right under the Equality Act 2010: men and women doing the same or equivalent work must be paid the same. Paying a woman less than a man for the same job is unlawful.
The gender pay gap is a different measure. It compares the average pay of all women in an organisation with the average pay of all men, across every role and every level. A company can pay every individual fairly and still report a large gap, simply because more men sit in its senior, higher-paid roles and more women in its junior ones. The gap is a measure of representation and structure, not of illegal pay discrimination.
Keeping these two ideas separate is the first step to reading any figure honestly.
How the gender pay gap is calculated: mean and median
There are two ways to average hourly pay, and UK reporting uses both because they answer different questions.
The mean is the everyday average. Add up everyone’s hourly pay and divide by the number of people. The mean gap is the difference between the mean for men and the mean for women, shown as a percentage of men’s pay.
The median is the middle value. Line everyone up from lowest paid to highest and take the person in the middle. The median gap compares the middle woman with the middle man. Because it ignores extremes, the median is usually the fairer picture of the typical employee, which is why it tends to be the headline figure.
Here is how the gender pay gap is calculated with a simple worked example. Imagine a small firm with five men and five women, paid these hourly rates:
Men: £12, £14, £16, £18, £40. Women: £13, £14, £15, £16, £17.
For the men, the mean is £20 (the five rates add up to £100, divided by five). The middle man, the median, earns £16. For the women, the mean is £15 (£75 divided by five) and the median is also £15.
Now the gaps. The mean gap is the difference between £20 and £15, as a share of the men’s £20, which is 25%. The median gap is the difference between £16 and £15, as a share of £16, which is 6.25%.
Notice what happened. One man earning £40, perhaps a founder or senior director, dragged the men’s mean right up and produced a dramatic 25% mean gap. The median stripped that single outlier out and showed a far smaller 6.25% typical gap. This is exactly why a company can post a scary-looking mean figure and a modest median, or the reverse, and why you should always read both.
The six figures UK employers must report
Employers with 250 or more staff on the snapshot date must publish more than one number. Under gov.uk rules the snapshot date is 5 April for most employers and 31 March for public bodies, and the report is due within a year of that date.
Each qualifying employer publishes six figures: the mean hourly pay gap, the median hourly pay gap, the mean bonus gap, the median bonus gap, the proportion of men and women who received a bonus, and the proportion of men and women in each of the four pay quartiles (the lowest-paid 25% up to the highest-paid 25%). The quartile figures are often the most revealing, because they show at a glance whether women are clustered at the bottom or spread evenly up the ladder.
Reports must appear both on the employer’s own website and on the government service at gender-pay-gap.service.gov.uk, so the data is genuinely public and comparable.
What the numbers actually tell you
A pay gap figure is a starting question, not a verdict. According to the Office for National Statistics, the gap among full-time employees was 7.0% in April 2024, down from 7.5% a year earlier, while across all employees it was 13.1%. Interestingly, for part-time employees the ONS recorded a gap of minus 3.0%, meaning part-time women earned slightly more on average than part-time men.
Those national figures show two things. Progress is real but slow, and the gap widens the moment you include part-time and lower-paid work, where women are overrepresented. When you look at a single employer, the useful move is to read the median alongside the quartiles: a low median gap but very few women in the top quartile still tells a story worth asking about.
For a plain-English walkthrough of the national picture, see our guide to the UK gender pay gap explained simply, and for the full employer rules our complete UK guide to gender pay gap reporting.
How to read an employer’s figures before you apply
If you are weighing up a job, the pay gap data is free intelligence. Look up the company on the government service, read the median rather than fixating on a big mean, and check the quartiles for whether women actually reach senior pay. Our guide on how to read a company’s gender pay gap figures breaks this down step by step, and if you are negotiating, how to negotiate a salary and close your own pay gap puts the numbers to work for you.
Frequently asked questions
How is the gender pay gap calculated in simple terms?
You work out the average hourly pay for all women and all men in an organisation, then express the difference as a percentage of men’s pay. It is done two ways, the mean (everyday average) and the median (middle value), because each highlights something different.
What is the difference between the mean and median gender pay gap?
The mean adds up all pay and divides by headcount, so a few very high earners can distort it. The median takes the middle earner of each group, which better reflects the typical employee. Most analysts trust the median as the fairer headline.
Does a high gender pay gap mean a company breaks equal pay law?
Not necessarily. The gap reflects how men and women are distributed across roles and levels, not whether they are paid equally for the same job. A company can meet its equal pay duties and still report a wide gap because men hold more of its senior roles.
Which UK employers have to report their gender pay gap?
Employers with 250 or more employees on the snapshot date, which is 5 April for most organisations and 31 March for public bodies. They must publish six figures within a year, on both their own website and the gov.uk reporting service.
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This is general information, not legal advice. Pay gap and equal pay rules depend on your circumstances. For guidance, see ACAS or the gov.uk gender pay gap reporting pages.
Last reviewed: July 2026