What is Pay Transparency?
Pay transparency is a principle whereby information about salaries within an organization is open or at least accessible to employees and job candidates. In the European context, this means a series of legal requirements aimed at eliminating pay inequalities, particularly between women and men.
Why Did the EU Take This Step?
Despite years of efforts toward pay equality, the gender pay gap in the European Union still averages 13% to women’s disadvantage. This means women work an average of 48 days per year “for free” compared to men. Previous regulations proved insufficient, so the European Commission decided to introduce more rigorous provisions.
Main Pillars of Pay Transparency in the EU
1. Right to Information
Employees gain the right to request information about average pay levels broken down by gender for people doing the same work or work of equal value.
2. Transparency in Recruitment
Employers must inform candidates about salary ranges before the job interview or in the job posting.
3. Ban on Asking About Salary History
Employers cannot ask candidates about their previous earnings – a practice that often perpetuated historical inequalities.
4. Reporting Obligations
Companies employing more than 100 workers must regularly report on pay gaps between women and men.
Benefits for Employees
- Greater negotiating power – knowing salary ranges allows for better wage negotiations
- Awareness of inequalities – easier to notice and report pay discrimination
- Equal opportunities – candidates start from the same position, regardless of employment history
Challenges for Employers
- Need to review and organize pay scales
- Investment in HR systems for reporting
- Organizational culture shift toward greater openness
- Potential employee claims in case of detected inequalities
What’s Next?
EU member states have until June 7, 2026 to implement the directive’s provisions into national law. For Poland, this means preparing appropriate laws and regulations that will change the face of the Polish labor market.
Pay transparency is not just a legal requirement – it’s a step toward a fairer and more equal labor market where compensation depends solely on competencies and work contribution, not on gender or negotiating skills.
This article serves as an introduction to a series of publications about EU Directive 2023/970 on pay transparency.
Read Also
- Penalties for Lack of Pay Transparency – What Sanctions Do Companies Face?
- GDPR and Employee Pay Data – How to Reconcile Transparency with Privacy?
- ‘Equal pay and EU directive on pay transparency’
Read also
- Equal pay and EU directive on pay transparency
- Salary Transparency in Job Postings – A Practical Guide for HR
- GDPR and Employee Pay Data – How to Reconcile Transparency with Privacy?
Develop your skills
Want to deepen your knowledge in this area? Check out our training led by experienced EITT instructors.
➡️ Blockchain Supply Chain - Transparency and Delivery Security — EITT training
Frequently Asked Questions
When must EU member states implement the pay transparency directive?
All EU member states, including Poland, must transpose the provisions of Directive 2023/970 into national law by June 7, 2026. After that date, employers will be subject to the specific obligations outlined in the directive, including salary range disclosure in job postings and pay gap reporting.
Will employers be required to publish exact salaries in job advertisements?
Employers will not be required to disclose exact salaries, but they must provide the starting salary level or salary range for each position before the job interview or in the job posting. This ensures candidates can make informed decisions and negotiate from a position of knowledge.
Can employers still ask candidates about their previous salary?
No, the directive explicitly bans employers from asking candidates about their salary history with previous employers. This provision is designed to break the cycle of perpetuating historical pay inequalities that disproportionately affect women and other underrepresented groups.
How does pay transparency help close the gender pay gap?
Transparency makes pay inequalities visible, which is the first step toward addressing them. When employees can access information about average pay levels by gender for comparable roles, it becomes much harder for unjustified gaps to persist, and organizations are motivated to proactively correct disparities.