6 Simple Pay Health Checks for EU Pay Transparency Readiness. Part Two: How to Analyse Gender Pay Gaps by Job Category
SkillsTrust Team
29 Oct 2025
• 4 minute read
Every company has pay anomalies, but with the incoming EU Pay Transparency Directive, it’s important that employers are proactively trying to identify those anomalies before 2026. If you’re struggling to know where to start, have no fear! There are simple Excel analyses you can run to get a view of the pay health of your company.
This is the second installment of our content series where we show you how to prepare your data and perform six easy checks in Excel to evaluate pay practices and uncover any inconsistencies.
In this article, we will focus on calculating the pay gap per job category. There are two prerequisites for this analysis:
Simple job categories
12-month pay dataset.
Our first article details how to prepare your data for analysis, so make sure you check that out if needed.
Once your data is prepared, we can start our first pay health analysis: Gender pay gap per job category.
The purpose of running this analysis is to identify any job categories with male/female pay differences that are greater than 5%. Any category with a gender pay gap of 5% will have to be reviewed to understand why the gap exists and whether those reasons are objective and unrelated to gender.
Note: The spirit of the EU Pay Transparency Directive is that pay differences should not be based on gender. Given this, we recommend investigating any pay gaps of 5% or more - whether in favour of men or women - to understand their underlying causes.
Why 5%
Under the EU Pay Transparency Directive, a pay gap of 5% or more in any job category either needs to be objectively justified or remedied. If an unjustified pay gap of 5% or more is not remedied within 6 months, a joint pay assessment with employee representatives may be triggered. See Article 10 of the Directive for further details on Joint Pay Assessments.
How to get started
Assign every role in your company to a job category. Then calculate the average hourly pay for men and for women for each job category.
Using the following formula, calculate the gender pay gap for the category:
What to look for
The result will be a percentage value that is either a positive or negative number. Positive numbers are pay gaps in favour of men i.e. a 10% pay gap means that on average, men are paid 10% more in that category. Negative results are pay gaps in favour of women i.e. a -10% pay gap means that on average, women are paid 10% more in that category.
Flag any job category with a gender pay gap greater than 5% (either in favour of men (positive value) or women (negative value)). These categories should be added to a risk list and reviewed to understand the root causes driving the pay gap.
Worked Example
In this example, we're looking at the Engineering 2 job category. This category has 3 roles in it: Graduate Software Developer, Graduate Software Engineer and IT Support Technician. For the purpose of pay transparency analysis, these roles are in the same job category. This means that they represent work of equal value and are considered to be comparators for pay-setting.
The data shows a cluster of female employees at the lower end of the pay range (around €20k–€25k) in the IT Support Technician role, as well as the Graduate Software Developer role (€27k-€32k). Male employees are more concentrated in the mid to upper end of each role's pay scale.
When we calculate the averages at a category level (i.e all roles together), women earn €33,391 on average compared to €37,102 for men. This results in a pay gap of 10%, meaning men in this category earn more overall.
As the pay gap is greater than 5%, this needs to be investigated to understand what might be driving this pay gap.
Factors that may be driving a pay gap within the job category include:
Miscategorised roles - there may be roles within the job category that have been miscategorised during the job evaluation stage. If the pay range for one role differs significantly from the ranges for other roles in the same category, it may indicate that the role has been miscategorised by job family and/or job level. If the role has indeed been appropriately categorised, then a justification is required for why the pay range would be so different to the other roles.
Individual Differences in Tenure, Experience, or Performance. Positioning of employees within a pay range should be guided by objective factors (ex. time in role, total experience, performance rating). Depending on the company’s method for determining pay range positioning, employees with less tenure or experience may be positioned lower in the range, while those with longer service and/or stronger performance are higher. However, if one gender is disproportionately represented among newer employees, has less prior experience, or holds fewer top performance ratings, this can contribute to a pay gap even when positioning criteria are objectively applied.
Representation & Small Numbers. When there are very few men or women in a job category, even small differences in individual pay levels can create a large percentage gap. For example, if only a few employees of one gender are in the group, one higher or lower salary can significantly skew the average. Applying objective pay range positioning rules can help confirm whether the gap is meaningful or simply a result of limited representation.
Part-time Work Penalty. When you look at the pay of all employees within the same job category on a normalised basis (i.e. per hour or if everyone was on the same full-time contract), it may be the case that those working part-time are making less than their full-time counterparts.
Uneven Bonus and BIK participation. The EU Pay Transparency Directive takes an expansive view of total pay including base, bonus and BIK (benefits in kind). Base salaries may be consistent but inconsistencies in participation across bonus and BIK may be a factor driving the pay gap.
Biased Pay-Setting. If you are still left with unexplained job category-level pay gaps, it may be an unconscious bias in pay-setting.
Check out our previous article about pay gap drivers to dig deeper into these drivers and how to close the pay gap.
How Do You Know if a Category-Level Pay Gap of 5% Is Justified or Not?
The EU Pay Transparency Directive outlines that where a job category has a pay gap of 5% or more, it either needs to be justified based on objective, gender-neutral criteria. If there are no objective gender neutral reasons for a pay gap greater than 5%, the pay gap must be remedied within 6 months. You can read more about this in Article 10 of the Directive.
To thoroughly understand your pay gaps, deeper analysis such as adjusted pay gap analysis using regression or pay gap decomposition can be very helpful. These techniques require dedicated expertise or software.
As a starting point, a lot of value and insight can be derived from simply checking the pay gap per job category.
Our next articles will dive into deeper analysis such as job category outliers, bonus & BIK participation and comparative pay across job families.
You can book a call to speak with our team here if you have any questions.
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