Pay Transparency Pilot: forging a fairer path
Every one of us has experienced the excitement of finding the right job. Reading through the advertisement, knowing it’s tailor made for you, excited to get stuck in and show off your skills. But then you see there’s no salary listed. Some people see that as a challenge; a chance to head to the negotiating table and ask for what they want. But for others, it means they end up receiving less than they are worth, and deserve.
Today, on International Women’s Day, I am delighted to say that the government is launching a programme of work to tackle this issue and get to the very heart of pay inequality.
By supporting upfront and honest salary information on job adverts we can make a difference for thousands of jobseekers, including those women who are trying to take the next step in their careers.
We are calling for all employers, where possible, to list salaries on job adverts by default, giving applicants a clear idea of what they are applying for, and significantly improving the transparency of the whole process.
Research suggests that women are less likely to initiate negotiation than men, causing a lower starting salary, which often leads to ongoing inequality throughout their careers. When salary information is not included or stated as negotiable during recruitment, it often leads to women and people from ethnic minority backgrounds being paid less over time.
Women and Black applicants are also more likely to face resistance if they do try to start a negotiation. Black professionals are twice as likely in the UK to be turned down for a pay increase after negotiation than their white counterparts.
Tackling this issue by making information available to everyone will go a long way to levelling the playing field. We must break down the stigma of talking about money. Whilst the saying goes — you should never talk about religion, politics, or money — by discussing salaries and being open about what we make, we can ensure everyone is getting a fair wage. The more we talk about money, the more equal we can make our workplaces.
It is not a quick fix, we know that many employers do not have agreed pay scales, and there are lots of reasons why they do not include pay information on job adverts. That is why we will work with employers to understand the barriers, and develop a methodology which will support them to overcome them.
Greater clarity on pay is good for business too. Research has found that pay transparency could encourage a wider talent pool of applicants. This could address shortages in specialist industries, including STEM fields.
This work will help us understand how the inclusion of more salary information can support the applicant at the negotiating table, and the employer in their business. If people can check immediately whether a job’s pay matches their needs and skillset, it’ll save time on unnecessary applications and ensure employers get the right people for the right roles. We will work with employers to develop a system for showing salary information that works for everyone involved.
We hope focussing activity on this will achieve a number of things: a better understanding of the process for employers; a method that’s been tested on the ground which can be made accessible to all businesses; and more evidence to help the case for pay transparency. The better we understand the problems the sooner we can all find effective solutions.
This is one of several measures launched today by Liz Truss to empower women and put them at the centre of our COVID recovery. I am also calling for an immediate end to employers asking about salary history during recruitment- ensuring people are paid what their work is worth, not held back by previous low earnings.
No-one should be paid a penny less than they are worth, whether they are doing their dream job or not.