Jobseekers will no longer have to apply for jobs without knowing what they pay, under new plans announced by the Prime Minister to legally require employers to publish salaries in job adverts.
The new policy plans to address the issue that too many jobseekers are still expected to apply for roles without knowing what they pay. It is estimated that less than half (41%) of employers always publish salary ranges and only 1 in 5 (18%) always publish specific salaries.
The government plans to mandate job adverts to ‘say what you pay’ by making publishing salaries a legal requirement and making openness about pay the minimum standard.
The change aims to tackle a common frustration for jobseekers, particularly young people applying for their first job, who can still be asked to apply without knowing what they will earn while also helping to address pay inequalities that can disadvantage women.
Prime Minister Andy Burnham said:
“Whether you’re a young person starting out or a parent trying to support your family, you should know what a job pays before spending your time and effort applying for it. That’s why we will make it a legal requirement for all employers to say what you pay.
“But breaking down barriers is only one part of the job. We also need businesses to open more doors and give young people the experience and confidence to take that first step into the world of work.
“It’s fantastic to see Siemens Mobility doing exactly that, creating 10,000 opportunities in engineering and technology and inspiring thousands more children through its national science lesson.”
The government will bring forward legislation as soon as possible. In the meantime, the Prime Minister is calling on all businesses to say what they pay on job ads now, rather than wait for the law to change.
The changes are part of the government’s wider drive to get more young people earning or learning, break down barriers to work and open up more opportunities to help young people get a foot in the door. Further reforms will follow the final report of the Milburn Review into youth inactivity, due in the coming weeks.
However, the intended policy changes bring certain risks according to Make UK. The association’s Executive Director for Legal Jay Bhayani said: “This may seem like a good policy on the surface. But making it a legal requirement risks becoming yet another compliance headache for employers when it comes to employment law.
“Greater pay transparency may be well intentioned, but there is a risk of unintended consequences for both employers and employees. Publishing salaries for new recruits can create tension where market rates have moved ahead of the pay of existing staff, something which is common in the private sector.
“Employers also need the flexibility to recruit the best person available and set pay according to their skills and experience. They may not know until after interview whether they want to recruit someone at the more junior or senior end of a role, or what scope there is to negotiate. If employers are effectively required to make a binding decision on pay before they know who they are recruiting, some may become more cautious about hiring altogether.
“Salary is only part of the picture. Candidates may be prepared to accept a lower salary for greater flexibility, progression opportunities or a strong workplace culture. And total remuneration can be complex, encompassing bonuses, overtime, pensions and other benefits which can vary considerably between employees.
“If this requirement is introduced, it is important that employers are able to advertise a meaningful salary range rather than being tied to an overly prescriptive figure.”
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