Context
The deadline for transposing the EU Pay Transparency Directive is 7 June. Most countries are currently behind schedule, with the Netherlands, for example, announcing its intention to postpone the entry into force of the text until 1 January 2027, despite tabling legislation in April 2025. Poland, Germany and France have all begun work on transposing the directive within the required timeframe, but draft legislation is yet to be published. In France, a bill is expected in the coming days following the resumption of consultations with the social partners in mid-January.
From EU lawmakers’ perspective, the directive approved in 2023 was intended to reduce the gender pay gap. At the continental level, it remains at around 12% for equal working hours and nearly 4% for equivalent positions and qualifications. The aim of the directive is to reduce these ‘unexplained’ pay gaps, i.e. those not directly related to the type of job, qualifications or experience, by highlighting them to companies, employee representatives, employees and the administration. So far, only a handful of European countries have implemented transparency measures.
Why it matters
Beyond the potential effect on reducing the gender pay gap, the impact of the directive is causing concern in the HR world, as its implementation may entail risks for companies in terms of finance, legal issues, internal atmosphere and attractiveness.
Preparing for transposition
Concerns arise from the fact companies will be compelled to be transparent about the core of their power vis-à-vis employees: the level of remuneration.
