Employment Alert – UK Government Consultation on transparency in UK pay

What’s happening?

The UK government is consulting on increasing the information on pay shared by UK employers. They are proposing that employers should be required to include pay and conditions information in job adverts or in writing to a candidate before an interview takes place.

These are currently just proposals. No changes have yet been confirmed and any changes are likely to need an Act of Parliament and legislation. However, a consultation opened on 14 July 2026 and will close on 27 October 2026. The consultation sets out various proposals for how this could work in practice and invites comments from interested parties.  

Its underlying aim appears to be encourage transparency in pay decisions and prevent pay discrimination occurring from the outset rather than waiting for it to be challenged through tribunal claims.

There are two phases to the proposed reforms. Phase 1 = fix the current system. Phase 2 = make equal pay effective for all.

Phase 1 includes requiring employees to publish the salary and pay range information during the recruitment process, widening the powers of tribunals to order equal pay audits and reintroducing statutory equal pay questionnaires so employees can gather information about pay before bringing a tribunal claim.

It also proposes introducing an Equal Pay Regulatory and Enforcement Unit (EPREU),a new enforcement body with powers to require disclosure of pay data and documents, compel audits and monitor compliance. This body is very similar in format to the newly formed Fair Work Agency and shows a real shift away from individuals having to address issues themselves to a statutory body acting on their behalf.

Phase 2 would then kick in once the earlier changes were all introduced (so is likely to be some way off). It would look to extend the existing equal pay system based on the grounds of sex to offer similar protection against pay discrimination on the grounds of race and disability. It also wants to increase the protection for outsourced workers.

Why is this important?

These proposals represent the most significant potential overhaul of equal pay law since the Equality Act 2010. It follows the global shift towards greater pay transparency and the steps recently taken in the EU.  As with all proposed changes; there are pros and cons for employers.

It can be incredibly frustrating for both employers and employees to go through a recruitment process and then discover that the pay expectations are very different and can’t be reconciled. These proposals should reduce this happening and make recruitment processes more transparent.

It may also alleviate pressure on the employment tribunal system, which is currently under strain. Alongside the newly formed Fair Work Agency, these equal pay proposals would move pay related issues away from the tribunals and on to the desk of a new regulator. This could mean more sector-wide or targeted investigations rather than individual tribunal claims. It is hoped the reputational risk to employers of being found non complaint and named by the regulator may encourage compliance and raise standards generally.

The consultation does raise some interesting practical points which haven’t yet been answered; including:

• What will be defined as “pay and financial benefits” and have to be disclosed?
• Will employers be able to quote a range of salaries to account for differences in experience and performance and if so, how wide can that range be?
• How will recruiters and third parties be affected by the new obligations?

Perhaps a bigger headache for employers will be how to manage these new obligations alongside existing staff. If salaries for long standing employees have not kept pace with salaries for new starters; employers will need to carefully consider how to manage this before salary ranges for the same job are published. This is likely to require pay reviews for all employees and potentially substantial pay rises in some areas. Salaries for those in senior roles are traditionally highly sensitive; this new consultation is likely to remove that secrecy and require a different approach.

Whilst there are no fixed steps businesses can take now; it is important employers have these proposals on their radar.

What should you do?

Stay Tuned: We will keep you informed on further developments on the equal pay consultation. The full details are unlikely to be known until late 2026/early 2027, with the details in Regulations to follow.

Review: Consider your current processes and documentation. Whilst waiting for the details of the final scheme to be announced, you can ensure payroll records and decisions on pay, bonuses and progression are accurate and properly recorded.

Audit: Have you got any areas in the business where pay transparency is going to have more of an impact? Consider how you could address this sooner rather than later.  Can you build in salary ranges to job adverts already to test the waters before the full Regulations are in force.

Take Advice: If you require advice on how these changes may affect your business, please contact [email protected] who can put you in touch with one of our specialist employment lawyers.