What is pay transparency, and what does it require under the EU Directive?

The EU Pay Transparency Directive was adopted in 2023. By 2026, all EU countries must implement it into national law. It is designed to make pay across Europe more transparent, consistent, and fair.  

For employers, this means: 

• Publishing salary ranges and comparative ratios during recruitment.
• Explaining how pay and progression decisions are made.
• Reporting on pay gaps if you employ 100 or more people. 

Ireland already has gender pay gap reporting obligations since 2022. From 2025, all employers with 50+ employees must submit GPG reports to the new gov.ie portal by the November deadline. Ireland must transpose the EU Pay Transparency Directive by June 7, 2026, bringing stricter rules. Employers must report gaps, explain reasons, and detail measures to close them, with the narrative becoming as crucial as the data. 

See also: SD Worx: 44% of Irish Employers Have Gender Pay Gap

The Directive is part of a wider European effort to close persistent pay gaps and increase fairness in the workplace. On average, gender pay gaps remain at around 13% across Europe, highlighting why the Directive was introduced. In Ireland, the current gender gap is 9.6%, as of 2022, the year during which Gender Pay Gap Reporting was made mandatory. 

“Equal pay for equivalent work should be the rule, not the exception.” – Eimear Byrne. 

When recruiting: 

• Salary ranges must be shared upfront (a clear band is fine).
• Don’t ask candidates about salary history.
• Write job descriptions in gender-neutral terms. 

In Ireland, it is not prohibited currently to ask about salary history, an update which would need to be put in place to remain compliant. 

When managing employees: 

• Be ready to show employees their pay level and where they fall within the pay band.
• Be prepared to share average pay levels for comparable roles, broken down by gender.
• Ensure pay and progression criteria are fair, objective, and transparent. 

Gender Pay Gap (GPG) legislation and Gender Pay Gap reporting in Ireland first came into effect in 2022. The Gender Pay Gap Information Act 2021 introduced the legislative basis for reporting the gender pay gap in Ireland. The Act requires businesses with over 250 employees to report on their hourly gender pay gap. The Act has progressed since its inception. In 2022, businesses with over 150 employees were required to report on their hourly gender pay gap. This reduced in 2024 to include employers of 150 or more employees. In 2025, Starting from June 1, all employers with 50 or more employees were mandated to publish gender pay gap reports. 

 If you’re a larger employer (100+ employees): 

• You’ll need to report on mean and median pay gaps (base and variable pay).
• Share the distribution of pay across quartiles.
• Disclose the proportion of men and women receiving variable pay.
• Report pay gaps by category of workers.
• If a gap of 5% or more can’t be explained, you’ll need to audit pay practices and agree a corrective action plan within six months. While the EU Directive requires corrective action for unexplained gaps over 5%, Ireland’s current legislation does not yet require this, though it will need to evolve to remain compliant with the Directive by 2026. 

The reporting schedule in Europe depends on your size: 

• ≥250 employees: annually from 2027
• 150–249 employees: every 3 years from 2027
• 100–149 employees: every 3 years from 2031
• <100: exempt at EU level (but some countries may choose to go further, like Ireland). 
   

In Ireland, In 2022, businesses with over 150 employees were required to report on their hourly gender pay gap. This reduced in 2024 to include employers of 150 or more employees. In 2025, Starting from June 1, all employers with 50 or more employees were mandated to publish gender pay gap reports. 

For many organisations, the Directive means building more structured and transparent pay frameworks: 

• Clear job architecture and role definitions.
• Salary bands and progression paths.
• Reporting systems that balance transparency with employee privacy. 

That may feel like a big shift, but it’s also an opportunity: more openness builds trust, boosts confidence, and strengthens your reputation as a fair employer. 

The EU Pay Transparency Directive isn’t just about compliance. It’s about giving leaders the clarity and structure to make decisions that employees can trust.