The UK government is planning major reforms to employment and anti-discrimination laws that would mandate employers to disclose salary information in job advertisements. The changes are expected to increase transparency in hiring processes, help jobseekers make informed career decisions and reduce pay discrimination.
Under the draft proposals, employers would be required to show salary details when advertising vacancies. The government has said it intends to make pay disclosure mandatory, but it’s still debating what form the information should be presented. Employers may have to publish an exact salary, a salary range or a benchmark pay rate for each job.
The government is also considering whether job advertisements can include additional compensation details such as bonuses, incentives or other employment benefits. If a position is not publicly advertised, employers would need to disclose salary information in writing before they invite a candidate for an interview.
In a policy document released by the Cabinet Office, the salary transparency will help candidates know if a role is the one they’re looking for before applying. The recruitment process would be significantly less affected by candidates whose salary expectations are drastically different from what employers are offering.
As an employer, the reforms might be the most effective solutions for inequality at the workplace, officials believe. Without being transparent about salary decisions, the Cabinet Office has found in academic research that women, ethnic minorities and people with disabilities have lower pay outcomes. By making salary information public, the government wants to remove unconscious bias in recruitment and salary negotiations.
Although salary disclosure is still voluntary in the UK, more and more employers have started to put pay information in job listings in recent years. Public sector organisations and charities are more likely to publish salary details than private companies, according to the Chartered Institute of Personnel and Development (CIPD). Most employers who do disclose pay, however, are not so detailed and give very wide ranges, with some ranges over £10,000.
The UK's proposals closely mirror new pay transparency laws being implemented across the European Union. Under EU rules, companies with more than 100 employees will have to disclose the starting salary or salary range for job vacancies in advertisements or prior to interviews. The EU regulation also prevents employers from asking candidates about previous salary history in interviews.
The UK government will consult on the proposals until October and there is hope for detailed legislation to be produced later. The new rules are expected to be applied to England, Scotland and Wales.
The situation in Northern Ireland is still uncertain. While the Equality Commission for Northern Ireland has said that EU pay transparency rules should be applied under the Windsor Framework agreement, the Northern Ireland Executive has yet to say if it is going to introduce similar legislation.
If implemented, the reforms would make a significant change in UK hiring practices, with salary transparency becoming standard in recruitment and possibly helping to close pay gaps in the workforce.
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