Ministers have unveiled proposals that would require businesses to include salary details in job advertisements as part of the Government’s overhaul of anti-discrimination legislation.
The draft plans, announced by the Cabinet Office on Wednesday, would introduce greater pay transparency across Britain’s employment market.
Under the proposals, employers would be required to provide salary information to prospective candidates before they apply for a role.
Where a company does not advertise a vacancy publicly, it would still have to provide applicants with written salary details before any interview takes place.
Labour said the measures would help jobseekers make more informed decisions about which roles to pursue while reducing the risk of discriminatory pay practices.
Officials are consulting on the exact requirements, including whether employers should publish a fixed salary, a salary band or a benchmark rate for advertised positions.
The consultation will also consider whether employers should disclose additional pay information, including bonus arrangements.
The Cabinet Office intends for the legislation to apply across England, Wales and Scotland, with the final details to be determined following a consultation that runs until October.
‘When pay is opaque, salary decisions can be influenced by stereotypes’, Cabinet Office says as ministers propose pay transparency rules
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Northern Ireland’s position remains uncertain after the Executive previously declined to confirm whether it would introduce similar measures.
The Equality Commission for Northern Ireland has argued that European Union pay transparency rules should apply in the province under the Windsor Framework agreed during Rishi Sunak’s premiership.
The Cabinet Office said greater pay transparency would allow people seeking work to make informed decisions before applying for jobs.
Officials also argued the proposals would benefit employers by reducing applications from candidates whose salary expectations do not match the pay on offer
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Labour’s consultation document cites academic research suggesting that a lack of pay transparency can contribute to unequal outcomes when employers make salary offers.
The Cabinet Office said: “When pay is opaque, salary decisions can be influenced by stereotypes such as stereotypes of women, ethnic minorities, or disabled people.”
Ministers said mandatory salary disclosure could help prevent discrimination before it occurs rather than relying on employees to challenge unfair treatment after the event.
While pay transparency is not currently a legal requirement in Britain, many employers have chosen to publish salary information voluntarily in recent years.
Research by the Chartered Institute of Personnel and Development found public sector organisations and charities are more likely to include salary details in job advertisements than private sector employers.
The same research found salary bands were more commonly advertised than fixed salaries, although the organisation said some employers published ranges with differences of more than £10,000.
The proposed changes are similar to transparency measures being introduced across the European Union, where companies employing more than 100 people must disclose pay information for new roles.
However, unlike the European Union rules, the Cabinet Office consultation does not propose preventing employers from asking candidates about their previous salaries.