I am going to move to the UK and currently taking part in the recruitment process for one of the companies. The employer asked me about my current salary, according to my contract I cannot expose this information, however the employer keeps insisting. He says that I will have to expose this information and it is obligated by the law. However when I checked I couldn't find any British law that would correspond to this information. Is there any law in the UK that obligates the employees to expose their current salary for the new employer?
I am not a lawyer. Don't take legal advice off the internet. etc. etc.
The new employer's statement is nonsense.
They might be talking about the fact that you usually give them a P45 from your old company when you start a new job. This will tell them how much income tax you've already paid this year so they can deduct the correct amount going forwards. As a result, it also lets them work out how much (taxable) income you already made this year and therefore what you were earning at your last place.
However, you don't have to give them one, and certainly not until after you negotiate and sign an employment contract.
If you don't give them a P45 then I think you get put on an emergency tax code, pay more income tax than you should this year, and will have to apply for a tax refund once April rolls around. It is very unusual and will be noticed, but there's not much they can do about it other than be annoyed with you.
The people who already answered your question probably know more about whether the non-disclosure of your current salary can legally be enforced in the UK. However I do want say this about it.
- The clause about non-disclosure of your current salary is probably meant to prevent you from discussing it with your current colleagues. By enforcing these non-disclosure your company can lowball it's employee's. However I don't think they are interested that much if you share it with an HR-person in another country.
- How likely is it that your current company finds out that you shared your salary with an HR-person in another country?
- Is your current company willing to start a lawsuit in another country over something quite minor?
About whether or not it is required to show your current salary to your new employer I think one the following is the case.
- The company is lying and want this information to be able to lowball you.
- They really are legally required to know your current salary. Could be that it is something visa-related like Tymotheusz says.
- It is not legally required but it is just some bureaucratic quirk of the company.
I think if it is a big/reputable company option 2 or 3 is far more likely.
Summarized, although it might be legally possible for your current company to come after you for breaching the non-disclosure of your salary, the chances of it actually happening are rather small I think. So if the UK-company seems reputable and gives you a good offer the benefits of just giving them your salary information probably outweigh the risks.
The correct answer is: You give them a salary range. A not completely stupid employer will know that an offer at the top of that sale range will be immediately accepted, an offer at the lower end will only be accepted after a lengthy search for jobs gets no result, and an offer in between will get a response somewhere in between.
You can feel free to ask why they would want to know your current salary. There is no legal reason why they would need to know it. You will eventually hand over your P45 which states your income so far in the tax year; that information is private and should never ever leave their payroll. If they tell you that they need to know your current salary to know what to offer to you, you tell them that your current salary is irrelevant for their offer, and that you wouldn't change jobs for the same salary obviously. Worst case - you walk away.
There is no law in the UK that restricts or prevents you from disclosing your salary. Because of this, there would be no legal recourse in the UK of disclosing your salary to an employer even if you signed a 'do not disclose' agreement with a previous employer.
The Equality Act 2010 also outlines that it’s unlawful to prevent employees from disclosing a difference in salary if they’re trying to understand whether it’s an equal pay issue between male and female workers exists.
In your case, if you simply don't want to disclose your salary to the recruitment of the company you are interviewing with, then don't. They most likely want to know your previous salary in order to give you an offer that is more beneficial to the employer.