Publication date: March 18, 2025
Equal pay and transparency is one of the fundamental pillars of social justice and gender equality policy in the European Union. Despite many years of efforts to eliminate the pay gap, there are still significant differences in the earnings of women and men performing the same work or work of equal value. In response to these challenges, on 10 May 2023, the European Parliament and the Council of the European Union adopted Directive 2023/970, which aims to strengthen the application of the principle of equal pay through pay transparency mechanisms and more effective enforcement of the law.
The new regulations require employers to disclose remuneration criteria, report pay differences and implement tools that allow employees to pursue their rights in the event of suspected discrimination. Another significant change is the transfer of the burden of proof to the employer in proceedings concerning unequal pay.
The purpose of adopting the directive 2023/970 on equal pay
One of the key reasons for adopting Directive 2023/970 was to remove barriers to the effective application of the principle of equal pay. Recital 11 of this legal act indicates that the main obstacles to the implementation of this principle result from several factors. First of all, it is the lack of transparency of pay systems, which means that employees do not have access to information that allows them to compare their earnings with the remuneration of others performing the same work or work of equal value. This prevents the detection and reporting of cases of pay discrimination, and also makes it difficult for employers to identify potential inequalities in the pay structure in their organization.
Another important issue is the lack of clear criteria for determining the value of work. The lack of clarity in the regulations in this area means that both employees and employers have difficulty determining whether pay inequality actually exists in a given case. Without precise guidelines for comparing positions, there is a risk that differences in pay will result not only from actual differences in duties, skills or responsibilities, but also from unjustified prejudices and gender stereotypes.
An additional difficulty in pursuing claims related to pay inequality is the procedural barriers that wronged persons encounter. Employees often do not have sufficient evidence that their remuneration is lower than the earnings of co-workers performing comparable tasks. In practice, access to information on the remuneration of individual categories of employees is limited, which significantly hinders pursuing justice through legal means. As a result, many people, even if they suspect that they have been the victim of pay discrimination, give up pursuing their rights for fear of complicated and lengthy proceedings.
The introduction of the directive aims to eliminate these problems by increasing the transparency of wages, which will allow for more effective detection and elimination of pay discrimination. Better availability of data on wages will enable employees to make more informed decisions and to more effectively pursue their rights. At the same time, employers and social partners will be able to identify and correct potential inequalities in the structure of wages more quickly, which will translate into more fair and transparent pay systems. As a result, the directive is to contribute to a fuller implementation of the principle of equal pay in practice, eliminating gaps in current regulations and strengthening the mechanisms of law enforcement in this area.
Polish regulations implementing the Directive
At the moment, there is no specific act that would introduce the regulations contained in Directive 2023/970. However, in 2024, a draft act was prepared amending the Labor Code. These changes are to be a response to the obligation to implement the Directive into the Polish legal system by 7 June 2026. Currently, the Act of 26 June 1974, the Labor Code (Journal of Laws of 2025, item 277), also contains provisions on the prohibition of discrimination. However, they do not take into account the changes described in the Directive regarding the transparency of remuneration. The legislator provides for two main legal changes to be introduced by the amendment:
1. Obligation to publish information about remuneration in job offers
One of the key solutions introduced as part of the amendment to the Labor Code is the obligation for employers to disclose information about remuneration in published job advertisements regarding employment opportunities for a given position. Each job offer, regardless of the form of its publication (e.g. online recruitment portals, press advertisements, company websites, social media), must include the amount of the proposed gross remuneration. The employer may provide both a specific rate and a salary range, including the minimum and maximum value. If the advertisement provides a salary range, it should also include information that the remuneration is subject to negotiation.
This requirement is intended to increase transparency in the recruitment process and eliminate situations in which candidates do not have full information about the financial conditions of employment, which can lead to pay inequalities and unfair treatment. This will allow future employees to make informed decisions about applying for a given position, avoiding cases in which the actual salary turns out to be significantly lower than their expectations or market conditions.
2. Sanctions for failure to disclose information about remuneration or discrepancy between the actual remuneration and that stated in the offer
In order to ensure the effectiveness of the new regulations and to guarantee their compliance by employers, regulations have been introduced providing for sanctions for failure to disclose information on remuneration or violating the terms and conditions specified in the job offer. According to the new regulations, entering into an employment relationship for a lower remuneration than that specified in the published employment advertisement or completely omitting information on remuneration in the job offer constitutes an offence against employee rights. In such a situation, the employer may be subject to a fine of PLN 1,000 to PLN 30,000.
These regulations aim to eliminate unfair practices used by some employers who, in order to attract candidates, publish advertisements with inflated salary rates and then, at the stage of negotiations or signing the contract, offer a much lower salary. Additionally, the obligation to indicate the salary in job offers aims to reduce the pay gap between women and men, because one of the reasons that maintains this inequality is the lack of transparency in terms of wages and employment conditions.
The introduction of such sanctions motivates employers to provide reliable information about salaries and treat job candidates fairly. This action is part of the broader policy of the European Union regarding strengthening the principle of equal pay and eliminating all forms of pay discrimination.
The most important assumptions of Directive 2023/970
Subject matter and scope of application of Directive 2023/970
Directive 2023/970 on pay transparency introduces uniform, minimum standards aimed at more effective enforcement of the principle of equal pay for women and men performing the same work or work of equal value. The new regulations aim not only to eliminate pay inequalities, but also to strengthen the prohibition of discrimination by introducing transparent pay mechanisms and more effective tools for enforcing the regulations.
The scope of the directive covers both the public and private sectors, imposing obligations on all employers, regardless of the size of the company. Importantly, the provisions apply not only to those already employed, but also to candidates applying for a job. Thanks to this, equal pay protection is extended already at the recruitment stage.
The Directive requires employers to use transparent and objective methods for assessing the value of work, which must be gender-neutral and take into account elements such as skills, scope of responsibility, level of effort and working conditions. Job evaluation systems should be agreed with employee representatives, if such bodies exist in the organisation. Additionally, an important aspect of the new law is the need to include soft skills in these systems, which have often been underestimated in the process of setting wages.
Pay Transparency Mechanisms
One of the pillars of the directive is to increase the transparency of wages in the labour market. Job seekers are guaranteed the right to obtain detailed information from their potential employer on the remuneration provided for a given position.
Every employer is required to state the starting salary or salary range in the job advertisement, and these rates must be determined based on gender-neutral and objective criteria. In the case of collective agreements, candidates have the right to information about the pay regulations contained in these documents. Furthermore, this information must be provided in a way that allows the candidate to make an informed decision – it can be included in the job advertisement, provided before the interview or provided in another, equally effective method.
The directive explicitly prohibits employers from asking about a candidate’s previous salary – both in relation to their current and previous jobs. This is intended to prevent situations in which pay inequalities are transferred from one job to another. Additionally, all recruitment materials, such as job advertisements or job titles, must be formulated in a gender-neutral manner, and the recruitment process itself should be conducted in a non-discriminatory manner.
Obligation to disclose remuneration structure
Employers are required to provide employees with full information on the remuneration criteria used in the organization, the method of determining the level of remuneration and the principles of their progression. These criteria must be transparent, unambiguous and gender-neutral, eliminating all forms of direct and indirect discrimination.
However, Member States may exempt smaller employers with fewer than 50 employees from this obligation. This avoids excessive administrative burdens for micro and small enterprises, while ensuring appropriate control mechanisms in larger organisations.
Employees’ right to information about wages
Under the directive, employees have the right to obtain written information about their own pay, as well as average pay levels in the company for people doing the same work or work of equal value, broken down by gender. Requests for such information must be processed within a reasonable period of time, not exceeding two months from their submission.
If employees believe that the information received is insufficient or imprecise, they have the right to request additional explanations and detailed data. The employer is obliged to provide a substantive and clear response. In order to ensure equal access to information, this data should be available in formats adapted to the needs of people with disabilities.
Pay Gap Reporting
One of the key control mechanisms introduced by the directive is the obligation for employers to report on the pay gap between women and men. Companies will have to provide monitoring bodies with detailed data on pay levels broken down by gender, which will allow for an assessment of the level of compliance with the principle of equal pay.
Employers will be required to prepare reports on salaries, which will include data on the average earnings of women and men in various job categories. This obligation applies to entities employing at least 100 employees, while companies with a larger number of employees will have to submit reports in shorter intervals. The reports will include information on average salaries in individual professional groups, as well as differences in salaries between the sexes, expressed as a percentage of the average salary of men. In the case of companies employing 100 to 249 employees, reports will be prepared every three years, while companies employing 250 or more employees will be required to submit reports annually.
Joint salary assessment
If the pay gap between women and men in a specific job category is at least 5% and is not justified by objective criteria, the employer will be required to conduct a detailed pay analysis in cooperation with employee representatives. If the employer does not take appropriate corrective action within six months of the inequality being detected, it will be necessary to implement additional mechanisms to eliminate pay discrimination.
Thanks to these solutions, the directive introduces a number of effective tools to prevent pay inequalities, strengthening the principle of equal treatment of women and men on the labor market. Transparency mechanisms and reporting obligations will allow for ongoing monitoring of the situation and taking adequate corrective measures, leading to real changes in pay structures throughout the European Union.
Employers’ obligations in implementing Directive 2023/970
According to the new regulations resulting from Directive (EU) 2023/970 of the European Parliament and of the Council, employers in the Member States of the European Union will have to take comprehensive measures to ensure compliance with the provisions on equal pay. The key objective of the directive is to eliminate pay differences between women and men performing the same or comparable work. The introduction of new rules involves the need to implement a number of changes covering the method of job evaluation, transparency of remuneration policy, availability of information on the principles of remuneration and salary progression, as well as regular reporting of remuneration data.
One of the basic steps that employers will have to take is to implement an objective mechanism for job evaluation. The new regulations require that every organization has a coherent job evaluation system that will allow for the comparison of work performed by different employees in terms of their duties, scope of responsibility, required level of competence and working conditions. This means that companies will have to develop uniform criteria for job classification, eliminating subjective factors that may lead to unfair differentiation of pay. This system should be updated on an ongoing basis to reflect changes in the organizational structure and the requirements of individual positions. Job evaluation is crucial because it allows for a clear definition of which positions are comparable and should be paid in a similar way, regardless of the employee’s gender.
Another important aspect highlighted by the directive is the need to ensure full transparency in the scope of the principles of determining remuneration. Employers will be required to introduce clear, objective and precisely defined mechanisms for determining remuneration, which take into account specific criteria, such as level of experience, competences, scope of duties or professional achievements. In practice, this means the need to develop and implement formal salary scales and salary grids, which will clearly determine the amount of remuneration in individual positions. It is also crucial that employees have easy access to this information – this means that the remuneration policy should be open and made available in the company, so that each employee can familiarize themselves with the remuneration principles and be sure that the applicable rules are applied in the same way to all employees.
Another important requirement of the directive is the need to inform employees about the rules on salary progression. Employers will be required to precisely define what conditions must be met in order for an employee to receive a pay rise or promotion. Transparency in this area means that every employee should have access to information on career paths and the mechanisms that determine salary increases. The employer should clearly define what competences, experience or achievements are required to be able to apply for a pay rise or promotion to a higher position. Implementing these rules will avoid situations in which decisions on salary increases are made in an arbitrary manner and may lead to inequality between employees.
Another key obligation resulting from the directive is the need to provide employees with access to information on their pay levels in the context of average pay in a given professional group. Employers will be required to provide data on average pay for positions of equal or comparable value, taking into account the gender breakdown. In practice, this means the need to systematically collect and analyse pay data and then make it public in such a way that employees can verify whether their pay is in line with market standards and whether there are no cases of unjustified pay inequalities in the company.
One of the most important control mechanisms provided for in the directive is the obligation to regularly report data on wages. Companies will be obliged to systematically collect information on employees’ wages, analyse it for potential inequalities and submit reports to supervisory authorities. These reports should include data on the structure of wages in the company, taking into account the gender pay gap and the comparison of wages in equivalent positions. Employers will also be obliged to make the results of these analyses public within the organisation, so that employees can have insight into the company’s wage policy and possible actions taken to eliminate inequalities.
Where pay analysis reveals even small differences in pay between women and men doing the same or comparable work, employers will be required to take corrective action. In such cases, companies should work closely with trade unions, employee representatives or equality bodies to identify appropriate remedies. This could include salary adjustments, introducing additional internal controls or changing pay policies to eliminate the risk of future inequalities. Employers will also be subject to monitoring mechanisms and sanctions may be imposed for breaches of the regulations.
In summary, the implementation of the new regulations means that employers will have to introduce significant changes in the way they shape salaries and manage their salary policy. The new obligations include ensuring full transparency of salaries, as well as introducing mechanisms for monitoring and eliminating salary inequalities. Thanks to these regulations, the remuneration system in companies will become more fair, which will contribute to improving employee trust and increasing their involvement in the development of the organization.
Privacy protection and pay transparency
According to Directive (EU) 2023/970 of the European Parliament and of the Council of 10 May 2023 on strengthening the application of the principle of equal pay for men and women for equal work or work of equal value through pay transparency and enforcement mechanisms (OJ EU. L. 2023, No. 132, p. 21), “pay” means the ordinary basic or minimum hourly or monthly wage and any other benefits in cash or in kind received by the employee directly or indirectly (complementary or variable components) from his employer by reason of his employment. Protection of remuneration, according to the case law, can be claimed on the basis of the provisions on personal rights.
The personal rights of an individual include broadly understood privacy, which concerns not only aspects of personal life, but also financial situation, including the amount of remuneration for work. Protection of these rights is an important element of civil law. Courts have repeatedly emphasized that information regarding an employee’s earnings may be treated as his personal rights. In particular, in accordance with judgment of the Court of Appeal in Białystok of 25 June 2014, III AUa 2078/13, LEX No. 1493722, the disclosure by the employer of the amount of remuneration without the employee’s consent may constitute a violation of personal rights within the meaning of Articles 23 and 24 of the Civil Code. This means that this type of information belongs to the sphere of privacy and its disclosure requires special caution.
However, case law also indicates that this issue is not clear-cut and requires consideration in each case in the context of the circumstances of the given case. Not in every situation will the disclosure of information about remuneration to the public or to third parties be automatically treated as a violation of personal rights. The analysis of the social and economic context, as well as accepted customs and principles of social coexistence, is of key importance. An employee may object to the disclosure of information about his remuneration, especially when there are justified reasons for doing so. This applies in particular to situations in which the disclosure of this information to third parties could significantly violate his privacy, e.g. by disclosing deductions for maintenance obligations or other financial obligations. In such a case, the amount of remuneration would enter the employee’s sphere of intimacy, and its disclosure could lead to a violation of personal rights.
Therefore, the protection of information about remuneration is not absolute, but depends on the specific situation. It is crucial to consider whether disclosing this information violates the privacy of the employee and whether there are reasonable grounds for keeping it confidential. Modern case law indicates the need to balance the interests of both parties – both the employee, who has the right to protect their privacy, and the employer, who may have legitimate reasons to provide this information in certain circumstances.
Changes introduced by the Directive
The Pay Transparency Directive gives employees the right to obtain information on their individual pay and average pay levels by gender for groups of employees doing the same or equivalent work. This information is to be made available in writing, at the employee’s request.
According to the regulations, employees can request this data either personally or through employee representatives, in accordance with national regulations and practices. Alternatively, they can request information from the relevant equality body.
If the data provided proves to be incomplete or inaccurate, employees have the right to request additional explanations and more detailed information. In such a case, the employer is obliged to provide a substantive response.
The Directive also gives employees the freedom to disclose their pay in order to enforce the principle of equal pay. Member States should ensure that contracts do not contain clauses prohibiting the disclosure of this information.
Any data transferred under the Directive must be processed in accordance with the GDPR and may not be used for purposes other than the implementation of the principle of equal pay.
In situations where disclosure could lead to the identification of a specific colleague’s salary, access to such data may be restricted to employee representatives, the labour inspectorate or the equality body. These representatives may advise employees on potential claims, but without disclosing the individual salaries of people doing the same or equivalent work.
How to prepare the company for the introduction of new regulations?
Employers should carry out a number of internal actions that will enable them to operate in accordance with the regulations contained in Directive 2023/970. It is worth focusing on the following issues:
Salary audit as a key element of diagnosing the situation
The first step in ensuring equal pay is to conduct a detailed pay audit to identify any potential inequalities in the company’s pay structure. This process should include analyzing pay data by employee groups, particularly in terms of gender, length of service, level of education, and scope of duties.
The EU directive introduces the obligation to regularly report on salaries and publish data on average earnings by gender and job groups. In the case of companies employing more than 100 employees, regular reports on the structure of salaries will be required, and in the event of finding inequalities exceeding 5%, the employer will be obliged to take corrective action.
A pay audit should also take into account factors that affect pay differences, such as the specifics of a given industry, job requirements, and scope of responsibility. It is also worth analyzing how bonuses and other salary supplements are awarded to exclude situations in which the criteria for awarding them could favor one group of employees over others.
Development of objective and neutral remuneration criteria
To eliminate unjustified differences in pay, it is necessary to create a transparent remuneration system based on clearly defined and uniform criteria. Remuneration principles should take into account the level of responsibility for a given position, required qualifications, scope of duties and work efficiency.
One of the recommended solutions is to use a job evaluation methodology, which allows determining the relative value of individual roles in the organization.
Additionally, an important element of the remuneration system is the introduction of salary brackets, which clearly define the minimum and maximum salary for a given position. Such a mechanism not only prevents salary discrimination, but also ensures greater predictability and stability of the remuneration policy in the company.
Budget to compensate for pay gaps
If a pay audit reveals unjustified pay differences, it will be necessary to prepare a budget to gradually equalize them. Depending on the scale of the problem and the financial capabilities of the company, corrections can be introduced gradually, for example through systematic increases for groups of employees whose salaries deviate from the established standards.
The implementation of a pay equity policy should be done in a fair manner and in accordance with the financial capabilities of the company. In some cases, companies may also seek additional sources of financing, for example by restructuring personnel expenses or using support programs offered by public institutions.
Educating managers and employees about pay transparency
Pay transparency is not only a matter of legal regulations, but also a change in organizational culture. Therefore, an important step in the process of implementing new pay rules is training managers and employees on the new regulations and best practices related to equal pay.
As part of training, managers should be familiarized with:
In turn, employees should be informed about their rights related to remuneration, including the possibility of pursuing claims in the event of detection of pay inequalities.
Mechanisms for enforcing the right to equal pay
In order for equal pay to not remain a theory, it is necessary to implement effective control and enforcement mechanisms. One of the most important solutions is to establish internal reporting procedures that allow employees to anonymously report cases of unfair treatment.
In addition, companies should cooperate with supervisory bodies such as the National Labour Inspectorate or national equality bodies, which can carry out inspections and impose sanctions if violations are found.
It is also worth emphasizing that, in accordance with EU Directive 2023/970, employers may be subject to financial sanctions in the event of a breach of the principle of equal pay, and employees harmed by pay discrimination have the right to compensation.
Summary
Directive 2023/970 is a key element in the pursuit of full equal pay between women and men in the European Union. It introduces specific obligations for employers, including ensuring transparency of pay, the obligation to report pay differences and enabling employees to access information on pay in the company. From a legal perspective, the directive is an important instrument in eliminating pay discrimination and promoting fair treatment of all employees, regardless of gender.
In practice, compliance with the new regulations requires employers to implement procedures that will provide both access to information on remuneration, as well as effective analysis and potential compensation of pay inequalities. It is also necessary to create appropriate mechanisms for monitoring and reporting remuneration, especially in larger organizations, which will allow for the ongoing identification and correction of any irregularities.
The implementation of Directive 2023/970 not only helps to level out pay inequalities, but also supports greater transparency in the labor market, which in the long term can contribute to improving the efficiency of the organization, increasing employee motivation and building trust between the employer and employees. From the perspective of employers, effective compliance with these regulations will require appropriate changes in remuneration policy, but it is also an opportunity to ensure compliance with new legal standards in the European Union.