Three years after it entered into force, by June 7, 2026, EU member states will be required to transpose the provisions of the Pay Transparency Directive, which introduces the principle of gender pay equality. With EU Directive 2023/970 of May 10, 2023, the European Union took action to ensure gender pay equality through transparency in pay determination criteria. Article 157 of the Treaty on the Functioning of the European Union (TFEU) outlines the principle of equal pay; consequently, the Directive seeks to implement it effectively. The Directive is to be applied in the public and private sectors, with no limits regarding the number of workers employed in the company, except for the reporting requirement for companies with more than 100 employees. In fact, big companies must send an annual report showing men’s and women’s salaries to an organisation that will monitor any gender pay gap. In addition, to ensure maximum transparency regarding economic conditions of employment, the principles enshrined in the Directive regarding remuneration should also be applied to candidates at the selection stage. Candidates should be fully aware of the economic terms and conditions of employment during negotiations, well in advance of their potential employment. In addition, employees will be entitled to receive information from their employer about their own salary level and the average salary levels of their colleagues performing the same or equally valuable work. The pay gap between men and women in each individual category is tolerable at 5 per cent. Beyond this limit, the enterprise must adequately justify any pay differences based on objective and non-discriminatory criteria. If justification is not possible, trade unions may collaborate with the employer to explore remedies that can reduce wage inequality within the specified limit.
2026 - Morri Rossetti
