With the adoption of Directive (EU) 2023/970 of the European Parliament and of the Council of 10 May 2023, the European Union has taken an important step forward in tackling the persistent gender pay gap, strengthening the principle of equal pay for the same work or for work of equal value. The new instrument, based on pay transparency criteria and enforcement mechanisms, represents a substantial evolution of the European framework on gender equality in the workplace.
The Directive aims to make Article 157 of the Treaty on the Functioning of the European Union (TFEU) truly effective, as it already enshrines the principle of equal pay. However, the presence of structural factors — including occupational segregation and limited pay transparency — continues to fuel wage disparities between men and women.
To address this situation, the Directive introduces new tools to make pay information accessible and assigns employers a series of practical and measurable obligations. The goal is to create a more transparent and accountable system for determining and managing remuneration.
Among the main innovations introduced by the Directive are the following:
Preliminary analysis of the gender pay gap
Employers will be required to conduct an internal analysis to assess whether pay disparities exist between men and women, using the parameters set out in the Directive. This analysis must be carried out before the reporting obligation comes into force, allowing companies to take timely action to correct any gaps before official deadlines.
This analysis is intended to prevent breaches of the Directive and reduce the risk of litigation, giving employers time to align with the new regulations.
Proceduralising the right of access to pay data
Employers must formalise procedures allowing employees to access information on the pay of other workers performing the same work or work of equal value. Each worker will have the right to know the average pay levels for comparable categories in order to verify the presence of any gender disparities.
In practice, companies will need to establish clear procedures for handling such requests, ensuring transparency and timely access while balancing the right to information with data privacy requirements.
Revision of recruitment procedures and job offers
Employers will be required to include clear information on pay levels or salary ranges in job postings. This aims to prevent gender-based discrimination and ensure that recruitment processes are equally accessible to all.
Accordingly, recruitment practices must be reviewed to ensure gender neutrality, avoiding implicit biases that may favour one gender over another. This includes reviewing job descriptions, interview processes, and evaluation criteria.
Periodic reporting and joint assessments
Companies with more than 100 employees will have to submit biennial reports on gender pay gaps to the monitoring body responsible for verifying the Directive’s implementation. Companies with more than 250 employees will have to do so annually. These reports must include detailed data on pay distribution and the causes of any inequalities.
If an unjustified gender pay gap exceeding 5% is identified, the employer will be required to work jointly with trade unions or employee representatives to conduct a joint assessment and identify corrective measures.
Reversal of the burden of proof in case of litigation
In pay discrimination cases, the burden of proof will rest on the employer, who must demonstrate that any pay difference is not based on gender discrimination. If a pay disparity is established, the employee will be entitled to compensation for the damage suffered, including back pay and moral damages.
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