The EU’s Pay Transparency Directive aims to promote equal pay for women and men and to reduce unjustified pay differences. The directive introduces new information rights for employees, but the requirements are largely designed to also be workable for small and medium-sized enterprises.
For employers, the directive means, among other things, that an employee has the right to request information on the average pay level, broken down by gender, for employees performing the same or equivalent work within the company. Employees also have the right to be informed about the objective and gender‑neutral criteria used in setting pay, such as responsibility, skills, experience, or the level of difficulty of the job tasks.
The purpose is to enable employees to better understand how their own pay compares to the average pay level for similar duties.
Individual pay levels will not be made public, and employers are not required to disclose the pay of individual employees. For small companies, this mainly means being able to describe the principles on which pay is set and, when necessary, to provide aggregated pay information at group level. Any pay difference must be justifiable based on objective, non‑discriminatory, and gender‑neutral criteria.
We recommend that enterprises with employees:
- review how pay and job positions are structured,
- document the principles for pay setting at an overall level, and
- ensure that information can be provided, when necessary, in a clear and accurate manner.
We are happy to assist with advice and practical implementation tailored to the specific needs of your company.