The UK government has launched a significant consultation on reforming equal pay and pay discrimination law.
Published on 14 July 2026, the consultation invites workers, employers, trade unions, public sector organisations and legal professionals to contribute their views on how the current equal pay framework could be improved.
The proposals could lead to greater pay transparency, stronger enforcement and wider protection against pay discrimination.
However, the proposed measures are still under consultation. They have not yet become law.
Employers must continue to follow the existing legal framework, while employees should avoid assuming that the proposed rights are already available. Both sides should still pay close attention to the direction of reform.
Maison Lex provides specialist employment law advice for employees and practical employment law support for employers dealing with workplace pay, discrimination and contractual concerns.
What Does Equal Pay Mean Under Current UK Law?
Equal pay does not mean that everyone working within an organisation must receive exactly the same salary.
Under the Equality Act 2010, men and women should receive equal pay and contractual benefits where they perform equal work for the same employer or an associated employer.
Equal work may include:
- Like work
This covers roles that are the same or broadly similar in terms of duties, responsibilities and required skills.
- Work rated as equivalent
This applies where roles have been assessed as equivalent under a valid job evaluation scheme.
- Work of equal value
Different roles may still be considered of equal value where they place comparable demands on employees through factors such as responsibility, training, skill, effort and working conditions.
Equal pay obligations can cover more than basic salary. They may also apply to overtime, bonuses, commission, holiday entitlement, sick pay, pensions, redundancy pay and other contractual benefits.
A different job title does not automatically establish that two roles have different values. The actual responsibilities and demands of the roles may be more important than the titles used by the employer.
Equal Pay Is Different From the Gender Pay Gap
Equal pay and the gender pay gap are connected issues, but they are not legally identical.
Equal pay concerns the contractual pay and benefits received by men and women carrying out equal work.
The gender pay gap measures the broader difference between the average earnings of men and women across an organisation.
An employer may report a gender pay gap without necessarily breaching equal pay law. An individual equal pay problem could also exist even where an organisation reports a relatively small overall gender pay gap.
Employers should not treat gender pay gap reporting as a substitute for reviewing individual salary decisions, grading structures and progression practices.
Employees should also consider the specific work being performed and the reason for the pay difference, rather than relying only on organisation-wide averages.
Why Is the Government Considering Reform?
The government considers the current equal pay system complex, expensive and difficult to navigate.
The consultation is examining how disputes could be resolved more effectively and how the framework could provide stronger protection against different forms of pay discrimination.
It also considers gaps affecting:
- Women bringing sex-based equal pay claims
- Workers from ethnic minority backgrounds
- Disabled workers
- Workers employed through outsourced service arrangements
The wider direction is towards earlier identification of pay problems, greater transparency and more effective enforcement.
This reflects broader changes taking place across UK employment law. Employers and employees can also review Maison Lex’s guide to the Employment Rights Act 2025 and its implementation timeline.
What Equal Pay Changes Are Being Considered?
The consultation covers several potentially important areas.
Greater Transparency Around Pay
The government is considering measures that may improve transparency around salary structures and pay decisions.
Greater transparency could help workers understand:
- How their starting salary was decided
- How salary increases are awarded
- What criteria apply to bonuses and commission
- How progression decisions are made
- Why comparable roles may receive different pay
For employers, greater transparency could create a stronger need for documented salary bands, defined progression criteria and clear records supporting discretionary pay decisions.
A pay difference is not automatically unlawful. Employers may have legitimate reasons for differences based on experience, performance, responsibility, location or market conditions.
However, those reasons should be genuine, consistently applied and supported by evidence.
A Faster Process for Pay Discrimination Claims
Equal pay cases can involve complicated comparisons, extensive documents and lengthy legal proceedings.
The government is seeking views on how the claims process could become faster, fairer and more cost effective.
A more accessible system may make it easier for employees to question unexplained pay differences. It may also increase the importance of employers investigating concerns before they develop into formal proceedings.
A pay dispute can sometimes lead to disciplinary action, dismissal or a wider breakdown in the employment relationship. Employees concerned about termination can review Maison Lex’s complete guide to unfair dismissal in the UK.
A New Equal Pay Enforcement Unit
The government is considering the establishment of an Equal Pay Regulatory and Enforcement Unit.
The consultation examines what powers the unit could receive and how it could support more effective enforcement of equal pay obligations.
Its final structure, responsibilities and authority have not yet been decided.
However, the creation of a dedicated enforcement body could move equal pay compliance beyond individual Employment Tribunal claims and towards more active regulatory scrutiny.
Employers may therefore need to consider not only how they would defend a claim, but also how their wider salary systems would appear during a regulatory review.
Wider Protection for Race and Disability Pay Discrimination
Current equal pay provisions principally address differences between men and women performing equal work.
Pay discrimination connected with race, disability or another protected characteristic may already be unlawful under other parts of the Equality Act 2010. However, those claims do not necessarily follow the same legal framework as sex-based equal pay claims.
The government is considering how protections could be strengthened and made more consistent for ethnic minority and disabled workers.
This could become a substantial development in workplace discrimination law.
Employers should review whether decisions connected with recruitment, salary, promotion, bonuses and progression could disadvantage workers because of a protected characteristic.
Employees should document the treatment they have experienced and seek advice based on the specific facts rather than assuming that every pay difference amounts to discrimination.
Protection for Outsourced Workers
The consultation also examines the position of outsourced workers.
Businesses and public sector organisations frequently outsource services such as:
- Cleaning
- Catering
- Security
- Facilities management
- Administration
- Customer support
Workers supplied through an external provider may work alongside directly employed staff while receiving different terms and salary arrangements.
The government is considering whether contracting organisations should have a duty to take reasonable steps to support pay equality within outsourcing arrangements.
It is also examining whether a new enforcement body should have powers to enforce that duty.
This may become particularly important for larger employers, public authorities and organisations that rely extensively on contractors or service providers.
What Should Employers Do Now?
The consultation proposals should not be treated as final legal obligations.
However, waiting for legislation to take effect may leave employers with limited time to investigate and correct inconsistent salary practices.
Employers can begin by reviewing:
- How starting salaries are decided
- Who has authority to approve pay
- How salary bands are applied
- How bonuses and commission are calculated
- How promotion and progression decisions are documented
- Whether job descriptions reflect actual responsibilities
- How pay decisions are communicated
- Whether employees carrying out comparable work are treated consistently
- How outsourced workers are used within the organisation
- How complaints about pay are investigated
An equal pay review can help identify unjustified differences before they develop into formal grievances, discrimination allegations or Employment Tribunal claims.
Employers should also be cautious about relying solely on:
- An employee’s previous salary
- Individual negotiation skills
- Informal manager discretion
- Historical salary decisions
- The argument that a worker did not request a pay increase
These factors may not always provide a complete or legally defensible explanation for a substantial difference.
Businesses requiring advice on pay structures, discrimination risks or employee complaints can explore Maison Lex’s wider employment law services.
What Can Employees Do About a Possible Pay Difference?
A salary difference does not automatically establish an equal pay claim.
Employees should first consider the work being performed, the person they are comparing themselves with and any explanation provided by the employer.
An employee concerned about unequal pay can review:
- Their employment contract
- Their job description
- The responsibilities they perform in practice
- Their salary, bonuses, overtime and benefits
- The duties performed by the proposed comparator
- Internal salary bands and grading structures
- Previous explanations provided by management
- Performance reviews and promotion records
- Relevant emails or written correspondence
Employees can raise questions with their employer and request an investigation.
However, employers must also respect the privacy and personal data of other workers. This may limit the specific salary information that can be disclosed.
Where informal discussions do not resolve the issue, an employee may consider raising a formal grievance.
Strict time limits can apply to Employment Tribunal claims. Employees should therefore avoid delaying legal advice while waiting for an internal process to conclude.
Can an Equal Pay Dispute Lead to a Settlement Agreement?
Some pay disputes are resolved through workplace discussions, a grievance process or changes to the employee’s salary.
Other cases may lead to a wider breakdown in the employment relationship.
An employer and employee may then consider resolving the dispute through a settlement agreement.
A settlement agreement is a legally binding contract under which an employee normally agrees to waive specified legal claims in return for an agreed financial package and other terms.
These terms may include:
- Compensation
- Notice pay
- An agreed reference
- Confidentiality provisions
- The treatment of bonuses or commission
- Amendments to post-termination restrictions
Employees must receive independent legal advice before a settlement agreement can become legally binding.
Maison Lex’s settlement agreement solicitors advise employees and employers on settlement terms, compensation and the legal claims being resolved.
Pay Differences Require Evidence, Not Assumptions
Employers should not assume that every difference can be justified by performance, experience or market conditions.
Employees should not assume that every colleague receiving a higher salary has been treated more favourably for an unlawful reason.
The central questions are usually:
- Are the employees carrying out equal work?
- Is there a relevant comparator?
- What is the reason for the difference?
- Has that reason been applied consistently?
- Is the explanation supported by reliable evidence?
Good records can protect both parties.
They help employees understand how decisions were made and allow employers to demonstrate that salary decisions were objective, consistent and unrelated to unlawful discrimination.
What Happens Next?
The consultation does not immediately change the legal rights of workers or the obligations placed on employers.
The government will review the responses before deciding how to proceed. The final reforms may differ from the current proposals, and further legislation may be required before any new rights or duties take effect.
Despite that uncertainty, the direction of reform is becoming clearer.
Pay transparency, accountability and enforcement are likely to receive greater attention. Employers should use this period to assess whether their current pay practices could withstand closer scrutiny.
Employees concerned about an unexplained difference should obtain advice based on their employment arrangements, responsibilities and evidence.
How Maison Lex Can Help
Maison Lex advises employers and employees on equal pay concerns, workplace discrimination, contractual disputes, grievances, settlement agreements and Employment Tribunal risks.
For employers, early legal advice can help identify weaknesses in salary structures, policies and management decision-making.
For employees, advice can help determine whether a pay difference may have a lawful explanation or whether formal action should be considered.
Every pay dispute depends on its individual facts. Early advice can prevent misunderstandings, preserve evidence and reduce the risk of avoidable escalation.
To discuss a workplace pay or discrimination concern, contact Maison Lex.
Frequently Asked Questions
Are the 2026 equal pay proposals already law?
No. The government is consulting on potential reforms. The current equal pay and discrimination framework remains applicable unless and until new legislation takes effect.
Does everyone doing the same job have to receive identical pay?
Not necessarily. Some differences may be lawful where the employer can establish a genuine and non-discriminatory reason. The reason should be consistently applied and supported by evidence.
Can an employee ask colleagues about their salary?
Employees may discuss pay concerns, but privacy, confidentiality and workplace policy issues should be considered. Employees can also ask their employer questions about salary structures and the reason for a pay difference.
Can outsourced workers bring equal pay claims?
The current position depends on the employment arrangement, comparator and legal basis of the claim. The government is consulting on stronger protection within outsourcing arrangements.
Should employers conduct an equal pay review now?
A review may help employers identify inconsistencies, unsupported salary decisions and potential discrimination risks before the proposed reforms progress.
Legal Disclaimer
This article provides general information only and does not constitute legal advice. Employment law may change, and advice should be obtained based on the specific circumstances of each matter.
