The EU Pay Transparency Directive is Directive (EU) 2023/970, an EU law intended to strengthen equal pay for equal work or work of equal value through greater transparency and stronger enforcement. It affects recruitment, worker access to pay information, employer pay structures, reporting and remedies. Detailed practical requirements must also be checked under the national law implementing the Directive.
Jurisdiction: European Union
Check applicable Member State law
The Directive in One Definition
Directive (EU) 2023/970 is commonly called the EU Pay Transparency Directive. Its purpose is to strengthen the application of equal pay between women and men through pay transparency and enforcement mechanisms. Transparency is therefore not the end goal by itself. It is intended to make potential unequal treatment easier to identify, understand and address.
Why It Is an Equal-Pay Law
The Directive is closely tied to the principle of equal pay for equal work or work of equal value. A worker may have difficulty exercising that right when the way pay is determined is unclear or when useful comparison information is unavailable. The Directive introduces mechanisms intended to reduce that information gap.
What Changes Before Employment
Pay transparency starts during recruitment. Applicants should receive information about the initial pay level or range early enough to support transparent negotiations, while employers are restricted from asking candidates about previous pay history. This encourages compensation decisions to start with the value and requirements of the role rather than the applicant's historical salary.
What Changes During Employment
Workers gain rights to information concerning their individual pay level and relevant average pay levels for categories of workers doing the same work or work of equal value. Employers also need to make relevant criteria for determining pay and pay progression accessible in accordance with the applicable rules.
What Employers Need Behind the Disclosures
Transparency works best when an employer has a structured compensation system behind the information it provides. Job classification, objective salary criteria, worker categories, progression rules and accurate compensation data can all become important when explaining how pay decisions were reached.
Reporting Is Only One Part of the Framework
Large and medium-sized employers receive much attention because of the Directive's reporting timetable, but reporting is not the whole law. Applicant rights, worker information rights and principles governing pay structures need to be assessed separately from employer reporting thresholds.
Frequently Asked Questions
Is Directive (EU) 2023/970 the Pay Transparency Directive?
Yes. Directive (EU) 2023/970 is the legal instrument commonly referred to as the EU Pay Transparency Directive.
Is the Directive only about the gender pay gap?
No. Gender pay gap reporting is one component of a wider system that also covers recruitment, worker information, pay structures, comparable work and enforcement.
Related Guides
Official Sources
Requirements and practices differ by jurisdiction and organisation. Check current local law, official guidance and professional advice for a specific situation.