The EU Pay Transparency Directive, aimed at strengthening the principle of equal pay for men and women, has passed the legislative stage and is now on its way to implementation in Poland. This undertaking, planned for 2026, will undoubtedly present challenges for Polish employers.
The Directive has two key pillars: pay equality and transparency. The EU legislator is responding to existing pay inequalities, pointing to a lack of transparency as the main cause of this phenomenon. The term "equal pay" covers work of equal value, eliminating unfair wage disparities based on gender. Pay transparency is intended to help employees demonstrate potential wage discrimination more effectively.
The gender pay gap in the EU reaches 12.7%, with the main causes being wage discrimination, horizontal segregation, and the proportion of full-time to part-time work. In Poland, the pay gap stood at 4.5% in 2021. Despite existing legal provisions, inequalities persist, proving how difficult they are to combat.
The Directive imposes obligations related to pay information during recruitment and for current employees. Employers will be required to report pay gaps and, if the gap exceeds 5%, carry out a “pay assessment” in cooperation with employee representatives. There are also requirements concerning the disclosure of remuneration criteria.
The most significant changes include a ban on pay secrecy, and employers will have to provide information on how remuneration is determined. The introduction of the Directive will also require employee representatives to be involved, which may lead to more complex decision-making processes within companies.
It is important to note that the Directive covers all workers, regardless of their form of employment. It also provides for penalties for non-compliance. The implementation of the Pay Transparency Directive is a major challenge for Polish employers, requiring alignment with new standards in pay management and closer cooperation with employee representatives. Although Poland has a relatively low pay gap, the implementation of the Directive will contribute to improving pay equity and increasing transparency in the labor market.
These issues are described in more detail by Krzysztof Nowak from Mercer in an article on his website. I encourage you to read the full piece!
Author: Agnieszka Orłowska (Managing Director w ESG Institute)
EU Pay Transparency Directive – Key Provisions and Potential Implications for Polish Employers
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