Budget 2026: Government to ‘act soon’ to address gender pay gap and pay transparency

The government is addressing “calls” to introduce mandatory pay transparency in job adverts and tackle gender pay gaps at firms, chancellor John Healey said in his Budget.

Healey said he has “heard calls” to introduce the measure that will ensure employers will be required to disclose salary ranges on job listings, as well as confirming the government “will act soon to make sure women are paid and promoted fairly.”

Tania Goodman, partner and head of employment at Collyer Bristow, told City AM the move is “a further step in its wider programme of workplace reform and may help shine a light on pay disparities that have previously gone unchallenged.”

“However, there is a wider question arising from today’s Budget: where is the investment in the infrastructure needed to support these reforms? New rights and obligations inevitably lead to greater scrutiny of workplace decisions and the potential for an increase in disputes and claims,” Goodman said.

Goodman added that the “challenge” the government faces now is “ensuring that the systems responsible for enforcing those rights are properly resourced.”

“Without corresponding investment in the tribunal system, there is a real risk that the benefits of new legislation will be undermined by unacceptable delays in practice,” she said.

EU transparency laws a ‘patchwork’ among firms

The announcement comes after British businesses continue to face headaches over complicated European Union pay transparency laws after a delayed, fragmented rollout across the bloc.

The EU pay transparency directive requires member states to mandate that companies disclose starting salaries and pay ranges in job listings, and some businesses must also report gender pay gaps. The rules aim to ensure equal pay for equal work, or work of equal value, between men and women across all 27 EU countries.

As the UK is not part of the EU, this directive does not apply, but many British companies are multinational and employ staff across the continent.

The member states had until 7 June 2026 to implement it into local law, but only a few countries, including Italy, Lithuania, Malta, and Slovakia, met the deadline.

Amy Bird, a top partner at Magic Circle law firm Clifford Chance, previously told City AM that compliance can be difficult for businesses because implementation is “patchwork” after some have managed to roll it out, but many have either delayed or not implemented it.

While the UK does not have any measures in place to ensure employers must legally disclose salaries in job adverts and gender pay gaps must be addressed, the government closed a consultation yesterday on equal pay and pay discrimination in order to gather views on how it “can deliver a comprehensive reform of the current equal pay framework so that it works better for workers, businesses, and the justice system.”

However, while welcoming the consultation, human rights watchdogs, such as the Equality and Human Rights Commission (EHRC), have urged ministers to go further by legally banning questions on salary history in job interviews to eliminate pay discrepancies between genders as well as grant workers a right to see their colleagues pay details.