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View full libraryThis Pay or Salary Freeze Notification Letter provides a clear written way to confirm that an employee's pay will remain unchanged for a defined period or pay review cycle. It explains the reason for the decision, confirms the employee's current salary and sets out when pay will next be reviewed.
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If you are managing employee pay and benefits, the toolkit brings together practical HR templates covering reviews, decisions, communication, implementation and ongoing administration.
This template brings together the key information, sections and considerations you need to create a clear, comprehensive and professional HR document. Preview the document below.
[Sender name]
[Sender address]
[date]
[Recipient name]
[Recipient address]
Dear [Recipient first name],
Pay review outcome
Following the Company's [annual pay review / remuneration review / business review], I am writing to confirm the outcome in relation to your pay.
As part of this review, the Company has decided that there will be no increase to your current salary / pay rate during the [year / pay review period].
Your current salary / pay rate will therefore remain unchanged at [£Amount per annum / £Amount per hour] with effect from [date].
Reason for the decision
The decision to freeze pay has been
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This letter provides a professional way to communicate a decision not to increase an employee's salary or pay rate during a particular pay review period. It is designed to help employers explain the decision clearly while avoiding the impression that contractual pay has been reduced.
The letter clearly confirms that the employee's current salary or hourly rate will remain unchanged. It can be used following an annual pay review, budget review or organisation-wide decision to pause salary increases.
The employer can explain the relevant business or organisational reasons for the freeze, such as financial pressures, changes in trading conditions, cost control or a wider review of remuneration. The explanation should be accurate and appropriate to the circumstances.
A salary freeze normally means that existing contractual pay remains unchanged. It is different from reducing an employee's contractual salary, which is a contractual change requiring separate consideration and, in most circumstances, agreement.
The letter can confirm when pay will next be reviewed. This helps avoid creating an expectation that a pay increase will automatically be awarded at that point while still providing employees with clarity about the organisation's normal review cycle.
Where a pay freeze applies to a group of employees, employers should apply the criteria consistently and consider whether the approach could create discrimination or equal pay risks. Any exceptions should have a clear and legitimate rationale.
Use these best practice actions, recommended timescales and process stages to understand when and how the Pay or salary freeze notification letter should be used, helping ensure each step is handled consistently and appropriately documented.
Understand the common mistakes to avoid when using this HR template, helping you reduce risk, prevent unnecessary costs and ensure the process is handled correctly.
No. A salary freeze normally means that your existing salary remains unchanged and that no increase is awarded during the specified pay review period. This is different from reducing your contractual salary.
If the freeze simply means that no discretionary or expected pay increase is awarded and the employee's existing contractual pay remains unchanged, there may be no contractual change to agree. However, if the employer wants to reduce contractual pay or change an agreed entitlement, different rules apply and agreement will normally be required.
There is no general statutory maximum duration for a pay freeze where employees' existing contractual pay is maintained. The employer should communicate the period or review arrangements clearly and continue to comply with minimum wage, equal pay, discrimination and contractual requirements.
This depends on how the organisation has defined the freeze. Employers may decide that it applies universally or allow specific exceptions, such as contractual progression, promotion, statutory minimum wage changes or critical recruitment and retention cases. Any exceptions should be based on clear and consistently applied criteria.
Not automatically. A salary freeze normally relates to salary or pay increases. Bonuses, allowances, benefits and other contractual terms should be considered separately and the letter should make clear whether they are affected.
HRDocBox templates are designed specifically for UK employers and structured around practical HR processes, UK employment law and current Acas and GOV.UK guidance. They provide a consistent starting point that can be adapted to the organisation's pay arrangements and the circumstances of the employee.
How this content is developed and reviewed
The Pay or salary freeze notification letter template is developed using a practical HR methodology that considers current UK employment legislation, ACAS guidance, CIPD good practice and the real-world HR process it supports. Templates and supporting information are regularly reviewed and updated, with additional reviews triggered by significant changes to legislation, guidance or established HR practice, helping ensure each document remains practical, relevant and suitable for UK employers.
Darryl Horn, Chartered HR Director
Darryl is a Chartered HR professional with over 25 years' experience in senior HR and employee relations roles.
He has extensive practical experience of managing pay and benefits HR processes and founded hrdocbox to provide businesses with practical, professionally developed HR resources grounded in UK employment law and best practice.
HRDocBox has been creating practical UK HR documents since 2009.
"Darryl provides support and advice with excellent judgement, and has a strong understanding of people, policies and UK employment legislation."
"He is someone I trust; consistent, dependable, and committed to doing things properly."
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