What is The Pay Transparency Directive?
The Pay Transparency Directive introduces new rights for employees and obligations for employers. The purpose of the directive is to strengthen the EU principle of equal pay for equal work and to eliminate gender-based pay discrimination.
In summary the Directive imposes new obligations on Employers outlined below but this is yet to be transposed under Irish legislation:
- Inform Job seekers about the starting salary or pay range in advance of an interview and will be prohibited from asking about pay history.
- Provide employees, on request, with information on their individual pay level and the average pay levels, broken down by sex, for categories of workers doing the same work or work of equal value. Employers will have 2 months from the date of request to respond.
- Publish information on the pay gap between female and male employees.
- Carry out a joint pay assessment if pay reports reveal a gender pay gap of at least 5% that cannot be objectively justified.
- Not prohibit existing employees from disclosing their pay.
What Progress Have Other Member States Made?
The Pay Transparency Directive was adopted by the EU in 2023 and member states had until 7 June 2026 to transpose the directive into local legislation. However, several member states including Ireland have not yet published draft legislation.
As it stands, only 4 member states were on track to transpose the Directive on time, Italy, Latvia, Malta and Slovenia. Several member states, including Netherlands and Czech Republic, have delayed the expected commencement of local transposing legislation until January 2027.
What Progress Has Ireland Made?
Ireland has not yet published it’s draft bill to transpose the Directive. However, other elements of the Directive have been implemented under the Gender Pay Gap Information Act 2021, which was expanded to include employers with headcounts of 50+ employees in 2025.
The Pay Transparency Bill is listed on the Government Legislative Programme Summer 2026 but is not included on the priority list.
The Department of Children, Disability and Equality have confirmed that The Pay Transparency Directive will be implemented on a phased basis once the passage of the transposing legislation is complete and employers will not be penalised for not having all elements of the Directive in place by the 7 June deadline.
What Should Employers Do Now?
Despite Ireland missing the deadline, the Directive will still be effective from an EU perspective, and this can have an impact on the employer-employee relationship for employers who receive requests for pay information. Employers should be prepared to receive these requests and respond in a meaningful way.
There are elements of the Directive that employers can prepare for in advance of the Irish legislation being enacted:
- Review hiring processes as there is a strong indication that under the Irish legislation employers may be required to advertise pay ranges with job advertisements, guidance is yet to be confirmed.
- Avoid requesting information relating to pay history during the recruitment process, including at the interview stage.
- Remove any pay secrecy policies or clauses from contract templates.
- Gather the pay data and categorise your workforce.
- Run gender pay gap data for each category of workers in advance to determine if a joint pay assessment will be required. Companies over 50+ employees are already required to produce GPG reports.
- Prepare for information requests: prepare managers to receive requests for pay information and ensure your data management systems (HR System, Payroll system etc.) are prepared to respond to requests within the 2-month deadline.
