UK Pay transparency and equal pay: major reforms on the horizon

Why should I read this?

The UK government has published its response to the 2025 Call for Evidence on equality law and launched a new consultation on equal pay and pay discrimination, closing on 27 October 2026.

The Call for Evidence findings reveal widespread concern that pay discrimination continues to disproportionately affect women, those from ethnic minority groups and disabled workers, while the existing framework is viewed as complex, costly and difficult to enforce.

The consultation seeks views on how to improve the current equal pay system by simplifying the existing framework, strengthening enforcement and introducing more proactive measures to prevent pay discrimination. It also explores how the right to equal pay can be made effective across sex, race and disability. Many of these proposals reflect themes raised in responses to the Call for Evidence, including concerns about weak enforcement, lack of pay transparency, barriers to bringing claims and gaps in protection for race and disability pay discrimination.

What do I need to know?

The consultation covers two broad areas: Phase 1 – improving the current equal pay system and Phase 2 - considering how pay discrimination protections could be strengthened across sex, race and disability.

Key proposals include:

Phase 1: Improving the current system

The consultation envisages a phased approach being taken to implementing any new legislation, with Phase 1 focusing on improving the current system as outlined below, before broadening the additional protection outlined in Phase 2. This reflects the government’s acknowledgment that “we need to fix the system before we bring more people into it”.

Pay transparency

The government is considering new pay transparency measures aimed at preventing pay discrimination before disputes arise, including:

• Disclosure of pay information in recruitment: with clear parallels to a key element of the EU Pay Transparency Directive, the consultation seeks views on requiring employers to include pay information in job adverts or, where there is no advert, provide it in writing before interview. The consultation asks what information should be required and at what level of detail

• Job evaluation schemes and equal pay audits: equal pay audits are a systematic process used to identify and address pay disparities between employees, usually men and women, performing the same or equivalent work within an organisation, helping to identify the causes of pay inequality and guide corrective action. Employment tribunals must currently order an equal pay audit after finding an equal pay breach, subject to exceptions. The exceptions are wide and consequently, only one equal pay audit has been ordered by a tribunal to date

The government is proposing to increase the use of equal pay audits where there has been an equal pay breach by removing all the statutory exceptions leaving only the exception of where an equal pay audit has been completed by the respondent in the previous three years. In addition, the government proposes requiring a tribunal to also order an employer to undertake a non-discriminatory job evaluation exercise (i.e. to compare the value of jobs performed by men and those performed by women when establishing whether certain jobs have equal value and are paid fairly) where it has found pay discrimination and if an up-to-date job evaluation scheme is not already in place.

• Pay discrimination questionnaires: Prior to 2014, claimants were able to ask certain questions of the respondent using a statutory discrimination questionnaire either before or during litigation proceedings. The government is proposing to reinstate the use of a standard questionnaire for pay discrimination disputes, in a simpler and more effective format. The questionnaire would be optional but, as before, a tribunal would be able to draw an inference from a failure to answer or from an evasive or equivocal answer

These proposals align with evidence submitted to the Call for Evidence that greater pay transparency can help identify and prevent pay inequalities. Respondents highlighted the benefits of clear pay bands, transparent grading structures and better workforce data, although concerns were also raised about confidentiality, inconsistent data collection and implementation challenges, particularly in relation to race and disability data.

Equal Pay Regulatory and Enforcement Unit

Reflecting findings from the Call for Evidence that enforcement of equal pay rights is often ineffective in practice, the government intends to create a new Equal Pay Regulatory and Enforcement Unit covering sex, race and disability pay discrimination. It is consulting on whether the unit should sit within the EHRC, the Fair Work Agency or a new independent body.

Possible new powers of the unit include requiring disclosure of evidence before a formal investigation, ordering job evaluation studies or equal pay audits as part of the unit’s investigatory powers, and requiring organisations to respond to inquiry recommendations and provide implementation updates.

Rules of Procedure and Independent Panel of Experts

The government also commits to formal reviews of the rules of procedure for pay discrimination claims and the operations of the independent panel of experts. This corresponds with stakeholder concerns that the current litigation process is overly complex, slow and inaccessible, discouraging individuals from pursuing claims.

Phase 2: Making the right to equal pay effective for all

Equivalent protections for sex, race and disability pay discrimination

The government is considering keeping the current sex equal pay regime and the existing Equality Act 2010 claims for race and disability pay discrimination, but “levelling up” protections where needed so claimant groups have broadly equivalent rights.

Proposed changes include:

• enabling tribunals to provide the remedy of modifying the terms of a claimant’s contract following a finding of race or disability pay discrimination, similar to how the sex equality clause provision operates under the current equal pay regime
• empowering tribunals to order an equal pay audit and job evaluation study following a finding of race or disability pay discrimination
• expanding the scope of race and disability pay discrimination claims to work that is ‘rated as equivalent’ or of ‘equal value’, in addition to the existing ‘like work’
• allowing the use of ‘hypothetical’ comparators for sex pay discrimination claims under the equal pay regime in two specific situations: where (i) a male successor employee is paid more than his female predecessor for the same role, and (ii) a new male employee is paid a higher salary than a current female employee for the same role, whose pay is then increased to match his salary
• giving tribunals discretion to extend the time limit for bringing an equal pay (sex pay discrimination) claim

Promoting pay equality in contractual arrangements

At present, outsourced workers generally cannot compare themselves with in-house employees in pay discrimination claims. The government is proposing to create a new duty on contracting parties to take all reasonable steps to maintain pay equality in their contractual arrangements where work is outsourced. This could apply to principals, intermediaries and service providers, with compliance assessed by reference to what is reasonable for each party. Only the Equal Pay Regulatory and Enforcement Unit will be able to bring claims for breach. Workers will not be able to bring claims themselves or be entitled to any financial compensation for breach.

What should I do next?

The timing of any changes is not yet clear although the government has committed to an extended implementation period and Phase 2 changes will only follow completion of Phase 1. Even so, the direction of travel is clear: greater pay transparency, increased scrutiny of pay practices, stronger enforcement mechanisms and enhanced protections across sex, race and disability pay discrimination.

Employers should therefore start reviewing their recruitment process, pay structures and pay governance now. Where work is outsourced, contractual arrangements may also need to be reviewed as the proposals develop.

Employers who prepare early, engage proactively and remain flexible will be better placed to navigate the changes.

Further reading and consultation response

• a copy of the consultation and associated documents can be found on the government website
• our briefing Ethnicity and disability pay gap reporting: Consultation launched on mandatory reporting provides further details of the consultation launched on 18 March 2025 on mandatory ethnicity and disability pay gap reporting
• our briefing Duty to prevent sexual harassment provides further details of the measures to strengthen protections which came into force in October 2024
• our briefing Advancing Equality: Further upcoming reforms in UK Law provides further details of the 2025 call for evidence on equality law

Monitor the latest UK Employment Rights Act developments with our interactive tracker, covering 37 key employment topics, plus access to the latest events and expert briefings all in one place.

The government’s consultation on equal pay and pay discrimination sits against a wider international trend towards greater pay transparency, including the EU Pay Transparency Directive. You can track the latest developments on our Navigating Global Pay interactive site, as well as accessing essential FAQs, timelines, a summary of the EU Directive, a glossary and briefings. 

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Virtual roundtable

Join us for our virtual roundtable to discuss this consultation and the practical implications of the proposals. Views from this discussion will be used to compile a collective response to the consultation.

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