Gender Pay Gap
Difference in average pay between male and female employees, expressed as a percentage of male average pay
What is Gender Pay Gap?
Gender pay gap is the difference between average male pay and average female pay, as a percentage of average male pay. It shows how pay is distributed between men and women across an organisation.
It is different from unequal pay for the same work. It often reflects the mix of roles and seniority, and many countries require larger employers to report it.
How this KPI is measured
- Function
- Human Resources
- Sub-function
- Workforce Planning
- Industry
- All Industries
- Type
- Lagging
- Impact
- People
- Unit
- %
- Measurement frequency
- Annual
- Formula
- ((Average male pay − Average female pay) / Average male pay) × 100
How to calculate it
Subtract average female pay from average male pay, divide by average male pay, and multiply by 100.
For example, if average male pay is 50,000 and average female pay is 44,000, the gap is (50,000 - 44,000) / 50,000 x 100 = 12%.
Also report the median, and the split of men and women in each pay quartile, since these show where the gap arises.
Where it is used
Meeting reporting requirements
Publish required figures.
Finding the drivers of the gap
See where it arises.
Tracking progress
Measure change.
How to improve it
Tips and common mistakes
- The gap is not the same as equal pay for equal work.
- Follow the legal definitions where they apply.
- Focus on the causes of the gap.
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