EU Pay Transparency Directive: What HR Teams and Managers Need to Do Now

On 7 June 2026, the deadline for EU Member States to transpose Directive (EU) 2023/970 on pay transparency passed. Progress across Europe is uneven: law-firm trackers reported that some countries had adopted comprehensive national laws, others only partial measures or drafts, and a few had published nothing yet. For employers with staff in several countries, that patchwork is exactly the problem.

The direction of travel is the same everywhere, though. Pay is moving from something managers discuss quietly to something organisations must be able to explain, in writing and in conversation. That is as much a people capability challenge as a compliance one.

What the Directive asks employers to do

The Directive is long, but its core duties for employers are easy to summarise:

• Pay information before hiring. Candidates have the right to receive the initial pay or pay range for a role, before the interview or in the job advertisement.
• No salary history questions. Employers may not ask applicants about their current or previous pay.
• Gender-neutral job titles and recruitment. Vacancy notices and recruitment processes must be gender-neutral.
• A right to information for employees. Workers can ask for their individual pay level and the average pay levels, broken down by sex, for people doing the same work or work of equal value.
• Objective, gender-neutral pay criteria. Pay structures need to rest on criteria such as skills, effort, responsibility and working conditions.
• Pay gap reporting. Larger employers must report on gender pay gaps. Employers with 250 or more employees report first by 7 June 2027 and then every year; employers with 150 to 249 employees report from 2027 every three years; employers with 100 to 149 employees start in 2031.
• Joint pay assessment. Where a gender pay gap of at least 5% cannot be justified by objective, gender-neutral factors, employers must carry out a joint assessment with employee representatives.

Rules on information before hiring, the ban on salary history questions and the right to information for employees apply to employers of all sizes.

Why this lands on managers and recruiters first

Policies and pay structures sit with HR and Reward. But the moments of truth happen elsewhere:

• A recruiter has to explain a pay range to a candidate and handle the follow-up question, without slipping into asking what the candidate earns now.
• A line manager gets a request for pay information from a team member and has to respond accurately, calmly and consistently.
• Two colleagues with the same title discover a difference in pay and ask why.

If managers are not prepared, even a well-designed pay framework can create distrust. The Directive makes these conversations routine, so they need to be a skill, not an improvisation.

A practical six-step plan

1. Map where you operate. List every country where you employ people and check the status of national transposition. Do not assume one policy fits all.
2. Review job architecture. Make sure roles are grouped and evaluated with clear, gender-neutral criteria, so you can show why jobs of equal value are paid alike.
3. Fix recruitment first. Add pay ranges to vacancies where required, remove salary history questions from forms and interview guides, and review job ads for gendered language.
4. Prepare for employee requests. Agree who answers, in what time frame, and with what data. Give managers a short script and a point of contact in HR.
5. Run a pay analysis. Look at pay by gender within comparable roles. Explain gaps you can justify and plan action for those you cannot.
6. Train the people who carry the message. Recruiters, managers and HR business partners all need practice, not just a policy PDF.

What good training looks like

Effective preparation is hands-on. In our experience-based programmes, participants rehearse the difficult moments rather than only hearing about them:

• Pay conversations. Role-play a manager responding to a pay question, including when the honest answer is “this is the range and this is how we set it”.
• Competency-based interviewing. Replace “what do you earn now?” with structured questions about skills and results. See our HR training for more.
• Bias in evaluation. Practise checking whether job evaluation and performance ratings favour certain groups. This connects directly with our diversity, equity and inclusion training.
• Communication under pressure. Build the skills to stay clear and fair when a conversation gets emotional. Our communication skills training covers feedback and difficult conversations.

The bigger opportunity

Organisations that treat the Directive only as a reporting exercise will do the minimum. Those that use it to build clear job structures, fair hiring and honest conversations about pay will gain something more durable: trust. Pay transparency is, at its core, a promise that people are treated fairly. Keeping that promise takes systems and skills together.

This article is for general information only and is not legal advice. Rules differ by country and change quickly, so check current national law or ask your legal adviser before you act.