EU Pay Transparency 2026: Obligations, Thresholds, Templates

1. What is the EU Pay Transparency Directive?

The EU Pay Transparency Directive (Directive (EU) 2023/970) is the largest reform of European pay equality law since the Equal Treatment Directive 2006/54/EC. It aims to reduce the gender pay gap by imposing reporting, information, and corrective obligations on employers.

Adopted on 10 May 2023, OJ L 132/21 of 17 May 2023. Member States have until 07 June 2026 to transpose the directive into national law.

"Member States shall ensure that all employers apply objective, gender-neutral criteria for remuneration and career development." — Art. 4(2) Directive 2023/970

2. Who is affected? The 100/150/250 matrix

Reporting obligations scale with employee headcount. Three thresholds determine the frequency and level of detail required for reporting:

Key obligations independent of the threshold (for all employers, including those with <100 employees):

• Salary range or entry-level salary in job postings or prior to the interview (Art. 5)
• Ban on asking applicants about previous salary (Art. 7(5))
• Employees' right to information regarding their own salary + average salary of comparable activities (Art. 7)
• Gender-neutral job evaluation (Art. 4)

3. Right to information: what employees can request

Art. 7 Directive 2023/970 grants employees a new, individual right to information. They may request from the employer in text form:

1. Their own salary
2. The gender-specific average of employees performing the same or equivalent activity
3. The criteria for salary determination, salary progression, and promotion

The employer must respond within 2 months. Refusal is only permitted if the request is manifestly abusive — the burden of proof rests with the employer.

4. Mandatory information in job postings from 07 June 2026

Art. 5 obliges employers to provide the following information in every job posting or before the first interview:

• Entry-level salary or salary range (based on objective, gender-neutral criteria)
• Where applicable: relevant collective bargaining provisions
• Gender-neutral job title and posting language

In practice: Including the information in the posting itself is the simplest compliance option (audit-proof, less potential for dispute). Those who rely on "before the interview" must document the delivery.

5. Pay report: content & frequency

The report under Art. 9 is significantly more detailed than the previous report pursuant to Section 21 EntgTranspG. Mandatory information (for 250+):

• Gender-specific pay gap (entire company)
• Pay gap based on variable remuneration (bonuses, commissions)
• Median pay gap (instead of arithmetic mean as previously)
• Share of female/male employees per salary quartile
• Pay gap per activity group ("groups of employees performing the same or equivalent activity")

The report is submitted to the competent national authority. The authority publishes aggregated data — the individual data is not public.

6. Joint pay assessment from 5% pay gap

If the pay gap of an employee group exceeds 5% AND cannot be explained by objective gender-neutral criteria AND has not been corrected within 6 months, a joint pay assessment is triggered (Art. 10).

The assessment is a joint evaluation with employee representation. Content: analysis of the causes of the gap, action plan, implementation tracking. The outcome is made public within the company.

7. GDPR interface

The EDPB clarified in Guidelines 03/2024: publication of individually identifiable salary data is to be measured against Art. 6(1)(c) GDPR (legal obligation). Reports with fewer than 4 persons per comparison group must be aggregated or suppressed — otherwise the re-identification risk applies (Art. 9 sensitivity of gender-related data).

8. Fines & reversal of burden of proof

Art. 23 requires "effective, proportionate and dissuasive" sanctions. Comparative countries:

• Belgium: up to EUR 187,500 per infringement
• Spain: up to EUR 225,000
• France: 1% of the total wage bill for repeated infringement

More important than the fine: Art. 18 Directive 2023/970 provides for a reversal of the burden of proof. If employees present indications (e.g. salary differences + identical activity), the employer must provide counter-evidence. The Federal Labor Court (BAG) ruling 8 AZR 488/19 (21 January 2021) already recognized the reversal of burden of proof under Section 22 AGG; BAG 8 AZR 300/24 (23 October 2025) additionally clarified in 2025 that a pairwise comparison with a single male colleague is sufficient for the presumption of discrimination — the EU directive tightens this further.

9. Status of transposition in Germany/Austria/Switzerland

Short answer: As of April 2026, the German transposition of the EntgTranspG is delayed (BMAS draft bill announced for Q3 2026) — however, the EU directive applies directly from 07 June 2026 via primacy of application. Austria is planning the EntgleichV with anticipated application date of 01 July 2026; Sweden has announced it will miss the deadline. Switzerland is not directly affected but retains the Logib audit obligation from 100 employees.

10. 8-step checklist by 07 June 2026

Short answer: Pay transparency compliance in eight steps: clarify threshold, establish gender-neutral job evaluation, expand job posting workflow to include salary ranges, set up an information process with a 2-month SLA, collect pay gap baseline (median per activity group), develop reporting template, establish joint pay assessment process with the works council, and brief the Data Protection Officer (DPO) for GDPR-compliant reporting.

1. Clarify threshold — employee headcount, definition of employees (part-time ratio, temporary workers), subsidiary companies
2. Create job evaluation — gender-neutral criteria, define "same/equivalent activity" clusters
3. Adapt job posting workflow — salary range as a mandatory field in the HR system, update templates
4. Establish information process — application form, response template, 2-month response SLA
5. Pay gap baseline analysis — median comparison per activity group + quartile distribution as the 2025 baseline
6. Develop reporting template — await the format of the national authority and prepare accordingly
7. Joint pay assessment process with the works council — threshold 5%, 6-month correction period
8. DPO briefing — GDPR-compliant reporting, aggregation thresholds, re-identification risk