Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Equal Pay definition

What does Equal Pay mean? Equal pay describes the right of an employee to the same pay and contractual terms as an opposite‑sex comparator where their work is equal. In Great Britain, this operates as “equality of terms” under the Equality Act 2010, which implies a sex equality clause into every contract to level up any less favourable term. It covers salary, bonuses, overtime, holiday, benefits in kind and, via a sex equality rule, occupational pension schemes. Work is “equal” where it is: (i) like work; (ii) rated as equivalent under a valid job evaluation scheme; or (iii) of equal value in terms of...

Equal pay: what counts as 'pay' under the Equality Act 2010 and Article 157 TFEU, including termination payments, pensions, maternity pay, and the contractual/non-contractual divide

Published by a LexisNexis Employment expert

Practice notes

This Practice Note explores the Equal pay for equal work principle under the Equality Act 2010 (EqA 2010) and, notably, what counts as ‘pay’. It addresses whether pay has to arise from contract and clarifies the concept of ‘pay’ in Article 157 of the Treaty on the Functioning of the European Union (TFEU) (formerly Article 141 of the Treaty of Rome). It also reviews how termination payments, pensions and maternity pay are treated.

The principle of equal pay for equal work

Article 157 TFEU sets out the rule that workers are entitled to the same pay for the same work. Under European law, a distinction is drawn between Equal Pay (under Directive 75/117/EEC, the Equal Pay Directive) and equal treatment of men and women (under Directive 76/207/EEC, the Equal Treatment Directive and later measures). The Equal Treatment Directive, Directive 76/207/EEC, does not extend to ‘pay’. The equal pay for equal work principle has been described as fundamental to the European Union’s foundations. Article 157 TFEU has Direct effect, allowing a court or tribunal to set aside incompatible obstacles in domestic law...

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Web page updated on 21/05/2026

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