Updated Gender Pay Gap Reporting Guidance: Key Changes for Employers
The Supreme Court’s decision in For Women Scotland Ltd v Scottish Ministers continues to have significant implications for employers, with updated government guidance now confirming changes to the way gender pay gap reporting should be approached. Employers should therefore review their current reporting practices and consider whether changes to payroll, HR systems and data collection processes may now be required.
What is Gender pay gap reporting?
Gender pay gap reporting is a statutory requirement for employers with 250 or more employees under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. The obligation applies annually and requires employers to publish data comparing the average pay of male and female employees across the organisation. The purpose of the reporting regime is to improve transparency around workplace pay disparities and encourage employers to take steps to address inequality.
The previous position on ‘gender’ and ‘sex’
Historically, government guidance on gender pay gap reporting referred to “gender” and suggested employers should be sensitive to how employees identify. However, following the Supreme Court’s judgment in For Women Scotland, the government updated its statutory guidance on 21 May 2026 to clarify that reporting must now be based on biological sex. This position is not surprising. The Regulations which introduced gender pay gap reporting were made under Equality Act 2010 (the legislation considered in For Women Scotland).
What the updated guidance says
The updated guidance, Gender pay gap reporting: guidance for employers, reflects the Supreme Court’s confirmation that the terms “man”, “woman”, “male” and “female” in the Equality Act 2010 refer to biological sex. The guidance now expressly states that reporting should also be based on biological sex.
One of the most significant amendments is within the section previously titled “Recording employees’ gender”, which has now been replaced with “Recording employees’ sex”. The guidance recommends that employers use information about sex already held within HR or payroll systems where possible, and avoid singling out employees to ask questions about sex. Where records are unavailable or unreliable, employers are encouraged to adopt a proportionate and confidential process enabling employees to confirm or update their recorded sex.
Importantly, the updated guidance also addresses employees who hold a Gender Recognition Certificate (GRC). It confirms that, for the purposes of gender pay gap reporting, employers should record biological sex rather than acquired gender. The guidance acknowledges the sensitivity of this information and reminds employers that unlawful disclosure of a person’s pre-GRC gender remains a criminal offence. Employers are therefore advised to ensure that any collection or handling of this data is undertaken confidentially and accessed only on a strictly limited basis.
Implications for HR
The changes are likely to create practical challenges for employers. Some organisations may need to revise existing payroll and HR reporting models to ensure data is categorised by biological sex, rather than gender identity. Employers may also see anomalies in year-on-year comparisons where employees who were previously included in one reporting category are now included in another.
Given the potential legal and employee relations sensitivities, employers should carefully review existing processes and policies before the next reporting cycle.