Government consultation: Pay Transparency and Pay Equality

Authors: Stephen Miller, Heidi Watson, Corinna Harris, Sophie Jackson and Charlotte Stern

The government is consulting on wide-ranging pay transparency and equal pay reforms, including a possible requirement for employers to disclose pay information during recruitment.

In July 2026, the government published a Consultation paper on reforms to equal pay and pay discrimination law, building on its 2025 Call for Evidence on this topic. Following movements in this direction within the EU, notably the 2023 Pay Transparency Directive, the most eye-catching proposal is a new pay transparency requirement. If implemented, employers will need to publish pay information in job adverts or, where there is no advert, provide pay information in writing before any interview. The detail would be set out in regulations but might include requiring employers to disclose salary ranges, fixed salaries, benefits, bonuses or collectively agreed pay information. It is not yet clear how these obligations would be enforced.

The Consultation also proposes a more interventionist enforcement model. A new Equal Pay Regulatory and Enforcement Unit could be established within either the EHRC or the Fair Work Agency, or as a standalone body. The proposals include giving the Unit powers to compel pay information before a formal investigation, require equal pay audits and job evaluation exercises, and monitor how employers respond to recommendations. Tribunal reforms are also proposed, including wider use of equal pay audits after successful claims, job evaluation schemes where appropriate, and the reintroduction of statutory pay discrimination questionnaires, giving employees a formal route to seek pay information before litigation.

To address race- and disability-related pay issues, the government has said that it is not proposing simply to extend the existing sex equal pay regime to those claims. Instead, it intends to “level up” protection so that race and disability pay discrimination claims have broadly equivalent remedies and procedures to those applied in sex related equal pay cases. It is also consulting on a new duty on parties in an outsourcing chain to take “all reasonable steps” to uphold pay equality, enforced by the new Unit rather than through individual compensation claims.

Key Action Points for Human Resources and In-house Counsel

Although implementation is not imminent and the reforms will be phased, employers should start preparing now. This will be especially timely for those embarking on pay transparency projects across Europe. It is sensible to review recruitment pay practices and salary ranges; consider whether pay structures, grading and job evaluation arrangements are sufficiently robust; and encourage employee self-disclosure of race and disability status, to enable employers to assess any pay gaps there. Employers could look at their outsourcing or contractor arrangements and check whether they could create pay equality risk.