Do we need to worry about Pay Transparency without UK legislation?

Longer answer - if you want to be able to recruit, retain and motivate the people you need to deliver your business objectives, yes.

Of course, we may see UK legislation in the future which would mean you 100% need to worry about it. It is very much aligned to the ethos of the current Government and we saw previous Governments bring in Gender Pay Gap reporting. So it is more when than whether. But there are two major reasons to worry about it now:

• It is highly likely that you are competing for talent with organisations that operate in places like the EU, US and Canada where they do have pay transparency legislation and many will be adopting a global approach. So your potential recruits (and existing team) will know what the competition are offering and want to know what your deal is
• Many will wonder what you are being so secretive about particularly with some high-profile equal pay cases hitting the news. This is particularly true with younger workers.

So burying your head in the sand and hoping that it won't happen is not a great strategy for talent management. But where to start?

Let's start with the misconception that pay transparency is about everyone's salary being visible to everyone else. There's a question about whether it should be, but that would be a massive cultural shift for the UK as a country. I have friends who I've known since school and I have no idea what they earn. It is just “not British” to ask about money and anyone sharing their earnings is seen as boastful.

So, what is it about? Simply put, it is making clear policies and processes around setting pay. That means sharing pay ranges before someone attends an interview and checking that there are not differences in pay between men and women that are not justifiably explained.

However, in our experience, it's easy to underestimate the amount of work that goes into preparing for pay transparency. There are a lot of things to get right before being ready to 'press the button'.

Pay transparency is gaining traction globally, becoming law in many US states and set to become compulsory across the EU from June 2026. If the UK follows suit over the course of time, the last thing anybody wants is to have to press the button before they're ready. So is it relevant if your organisation operates in a location without regulation? Absolutely. Quite aside from being ready for future legislation, here are eight powerful reasons why every employer should embrace pay transparency—regardless of local laws.

Eight Key Reasons to Prioritise Pay Transparency

• Boost employee engagement and retention. Transparency fosters loyalty and commitment, helping to ensure talented people choose to stay. Data suggests that employees who think they are paid below market are 45% more likely to look for a new job in the next 6 months than those thinking they are at or above the market.
• Gain a competitive edge for top talent. Candidates are twice as likely to apply for and join organisations that are upfront about pay structures.
• Promote fairness and equal opportunities. Transparent pay practices reduce bias and ensure everyone has the same chance to succeed. You may have seen the cartoon with three people of different heights trying to see over a fence. The tall people don't need a box to stand on but the shorter people might. This isn't giving them an unfair advantage - this is putting them level to start with, making it fair for all.
• Build trust between employees and the organisation. When pay decisions are explained openly, people feel respected and valued. How can you put a price on that?
• Identify and address unfair pay practices. Visible salary data makes it easier to spot—and fix—inequities. This started with Equal Pay and Gender Pay Gap Reporting and we will soon see reporting for other protected characteristics like Ethnicity and Disability.
• Create an open, honest workplace culture. If openness is a core value, a lack of transparency makes it feel like just a buzzword. How many corporate values pages have you seen talking about integrity and respect, where companies are then not willing to be honest about how people are rewarded?
• Clarify career paths and growth opportunities. Employees need to see how pay progresses as their skills and roles grow.
• Drive positive change and set an example. Transparent pay practices inspire action across your sector and help position your organisation as a leader

Why It Matters

Even where regulation isn't forcing the pace, organisations that voluntarily adopt pay transparency are signalling integrity and productivity—qualities that matter more than ever in a competitive market. Transparency is not just about compliance; it's about building better workplaces that attract and keep the best people.

If you want fairness, loyalty, and a reputation for leadership, start the journey towards pay transparency today. Don't wait for the law to catch up.

Reward Heads developed a Pay Transparency Journey based on our experiences with clients and indeed our own organisation. We would love to help you on your journey - please reach out at rewardsolutions@rewardheads.co.uk.

We have also developed an online coaching module on pay transparency which can be purchased here Mastering Pay Transparency

And if you'd like to assess where you are on the journey, please take this free self-assessment Pay Transparency Assessment