UK's 'Say What You Pay' Law: Salary Transparency or Startup Burden?

Jan de Vries · 2026-11-06

Imagine applying for a job and actually knowing what it pays before you invest hours in the process. That's the future the UK government is pushing for with its new 'say what you pay' law, which would require employers to publish salary ranges in job adverts. The goal? To boost transparency, help jobseekers make informed decisions, and tackle the stubborn pay gap that still plagues many industries. But while the intentions are good, the ripple effects could be felt far beyond the UK—especially by European startups that operate in or hire from the UK. If you're a founder, HR lead, or anyone involved in European startup incorporation, this is a policy shift you can't afford to ignore. ### Why Salary Transparency Matters Pay secrecy has long been a tool for employers to keep wages down and discrimination alive. Studies show that women and minority groups are often offered lower salaries when pay is negotiable and opaque. By forcing companies to show their cards, the UK hopes to level the playing field. For jobseekers, it's a win: no more awkward conversations about salary expectations or discovering you're underpaid compared to a colleague. For employers, it's a mixed bag. Yes, it builds trust and can attract better-fit candidates. But it also means you can't lowball offers or tailor salaries based on someone's previous pay—a practice that's already banned in some US states. ### What This Means for European Startups If you're running a startup with a UK presence, you'll need to adapt. That might mean rethinking your hiring strategy, standardizing pay bands, and being prepared to justify any gaps. It's not just about compliance; it's about culture. Startups thrive on flexibility, but this law demands structure. You'll need to define clear salary ranges for each role, which can be tricky when you're scaling fast and roles evolve quickly. For those planning European startup incorporation, the UK's move could influence EU policy. Already, the EU Pay Transparency Directive is set to take effect in 2026, requiring companies to disclose pay information to job applicants. The UK's law could accelerate that timeline or inspire stricter rules. So even if you're not hiring in the UK, it's worth preparing for similar requirements across Europe. ### The Cost of Compliance Let's talk dollars and cents. Implementing salary transparency can be costly. You might need to invest in HR software ($50–$200 per employee per year), conduct pay audits (consultants charge $5,000–$20,000 for a small startup), and train managers. For a lean startup, those numbers add up. But the cost of non-compliance—fines, reputational damage, and losing top talent—could be higher. ### A Double-Edged Sword? Not everyone is convinced. Critics argue that publishing salaries could lead to resentment among employees who discover pay disparities, or that it might discourage companies from hiring in the UK altogether. But evidence from countries like Norway and Denmark, where salary transparency is common, suggests otherwise. Those countries have narrower pay gaps and higher job satisfaction. > "Transparency is the first step toward fairness. If you're paying people differently for the same work, you should be able to explain why." – Anonymous HR director at a European scale-up ### How to Prepare So what should you do? Start by auditing your current pay practices. Identify any unexplained gaps and fix them before they become public. Then, develop clear salary bands for each role, based on market data and internal equity. Communicate openly with your team about the changes—they'll appreciate the honesty. And if you're planning to incorporate in Europe, keep an eye on similar legislation; being proactive now can save you headaches later. Ultimately, the 'say what you pay' law is more than just a UK issue. It's a signal that the era of pay secrecy is ending. For startups, it's a chance to build a fairer, more transparent culture—or risk being left behind.