The EU Pay Transparency Directive (Directive (EU) 2023/970) requires employers to publish pay ranges to job applicants, stop asking about salary history, give workers the right to know average pay levels for comparable roles, and report their gender pay gap. Member states had to write it into national law by 7 June 2026. The first gender pay gap reports are due by 7 June 2027, covering 2026 data, so the payroll data being generated now is what employers will have to report.
This is the most significant pay equity legislation in Europe in decades, and it applies to any employer with workers in the EU, including companies headquartered elsewhere. This guide explains what the directive requires, who it applies to, the deadlines, and what employers should be doing now.
Adopted in May 2023, Directive (EU) 2023/970 strengthens the principle of equal pay for equal work, or work of equal value, between men and women. It does so through transparency: making pay information available to candidates, employees and regulators, and requiring employers to explain and address unjustified gaps.
As a directive, it sets minimum standards that each member state must write into national law. Some countries have gone further than the minimum, so employers need to check the rules in each country where they employ people.
The directive applies to employers with workers in the EU even if the company is based elsewhere, so US, UK and other non-EU companies with EU employees are in scope.
Employers must report gender pay gap data including mean and median gaps in base pay and in variable or complementary pay, the proportion of men and women receiving variable pay, and the distribution of men and women across pay quartiles.
| Employer size | First report due | Frequency |
|---|---|---|
| 250 or more workers | 7 June 2027 (2026 data) | Annually |
| 150 to 249 workers | 7 June 2027 (2026 data) | Every three years |
| 100 to 149 workers | 7 June 2031 | Every three years |
| Fewer than 100 workers | Not required by the directive | Some member states may extend it |
Because the first reports cover 2026 payroll data, employers in scope need accurate, structured pay data for the current year, including variable pay such as bonuses, overtime and allowances.
If reporting shows a gender pay gap of at least 5% in any category of workers that the employer cannot justify with objective, gender-neutral criteria, and the employer does not remedy it within a set period, the employer must carry out a joint pay assessment with worker representatives. That assessment analyzes the causes of the gap and sets out measures to address it.
The transposition deadline was 7 June 2026, but most member states missed it. As of August 2026, only a handful had implementing laws in force, including Italy, Slovakia, Lithuania, Malta and Greece, with others expected to follow during 2026 and 2027.
For employers, this creates a tricky position: the obligations are coming everywhere, but the detail, timing and penalties differ by country. Waiting for each national law before preparing leaves very little time to get pay data in order.
Member states had to transpose it into national law by 7 June 2026. Most missed the deadline, so national laws are taking effect at different points during 2026 and 2027.
You must provide the starting salary or pay range either in the job advert or before the interview. Some national laws may be stricter.
No. The directive prohibits asking candidates about their current or previous pay.
Employers with 100 or more workers, phased by size: 250 or more report annually from June 2027, 150 to 249 every three years from June 2027, and 100 to 149 every three years from June 2031.
If a gap of 5% or more in a category of workers cannot be objectively justified and is not remedied, the employer must conduct a joint pay assessment with worker representatives and take corrective action.
Yes, where they employ workers in the EU. The obligations follow the employment relationship, not the company's headquarters.
Global Expansion employs your team members under local law across Europe and 214 countries and territories, with structured payroll and pay data. Talk to our team about employing people in the EU.