Gender pay transparency in the EU: Steps taken and lessons learned

As of January 2024, and prior to the mandatory transposition of the Pay Transparency Directive(opens in new tab)This link opens in a new tab, just over half of EU Member States had independently implemented some form of pay transparency measure. The aim of such measures is to make pay systems open and understandable, so that unjustified pay differences can be identified and corrected, thereby addressing one of the root causes of the gender pay gap – gender bias and discrimination in pay setting and pay structures.

The frontrunners – Denmark, Finland, Italy and Sweden – began implementing transparency measures in the late 1990s and early 2000s, followed by Austria and Belgium in the 2010s. The European Commission’s Pay Transparency Recommendation in 2014 prompted a third wave of action, with Germany, Ireland, Lithuania, Portugal and Spain introducing legislation between 2017 and 2021. While several countries still lack pay transparency measures and will be required to catch up rapidly, frontrunner experiences provide a valuable set of shareable lessons, which are analysed in depth in a forthcoming research paper by Eurofound.

In trying to pull together information on the effectiveness of these policies the lack of systematic official evaluation exercises soon became clear. Only Germany and Sweden have conducted recent assessments of the effectiveness of their transparency measures. Consequently, policymakers have limited evidence about what works, why and under what circumstances. However, the directive requirement that Member States report on implementation and impact by 7 June 2031 (Article 35) promises to address this evaluation deficit.

Academic research can compensate for the lack of official evaluation but only to a certain extent, as it focuses primarily on short-term impacts, typically within one to two years of implementation, and covers only some companies (usually those around the reporting thresholds). The medium- and long-term effects of pay transparency measures remain largely unknown, as do their impacts according to company size, earnings segment and industry sector. Such research also tends to focus on company-level pay gaps (which are the main target of the pay transparency measures) and is based on large datasets of companies. Results from pay gap reporting or auditing measures are usually not considered. This is due to limited data availability linked to the recency of implementation of some of these measures, but possibly also to difficulties in accessing relevant data.

For example, in Ireland, the Gender Pay Gap Information Act 2021 requires companies to publish reports on their own websites rather than through a centralised repository. While these reports are technically accessible, this decentralised approach makes them difficult to locate, compare and analyse systematically. To remedy this, plans were announced for a central online portal (DCDE, 2025), to be launched in autumn 2025, addressing public data accessibility more than three years after the act came into force. In other countries, such as Austria and Luxembourg, current pay gap reporting measures are – by law and design – not publicly available.

The evidence that is available presents a mixed picture. Research examining gender pay reporting and auditing requirements in Denmark, Switzerland and the United Kingdom demonstrates reductions in gender pay disparities at the company level, notably through slowing wage growth for male employees in Denmark and the UK (Bennedsen et al, 2019; Vaccaro, 2017; Blundell et al, 2025). A recent study in Germany established short-term impacts of transparency legislation in reducing the raw gender pay gap, but only for medium-sized establishments and where works councils or collective bargaining agreements were in place (Vaccaro et al, 2024). Similarly, Austrian evidence points to positive outcomes from mandatory salary disclosure in job advertisements (Frimmel et al, 2023). However, other Austrian studies on gender pay gap reporting found no measurable impact on the gender pay gap (Böheim and Gust, 2021; Gulyas et al, 2023), nor did studies on the German set of pay transparency policy measures (BMFSFJ, 2023; Brütt and Yuan, 2023; and Seitz and Sinha, 2023) nor a study on the salary range mandate in job advertisements (Skoda, 2022).

While collection of further evidence across Member States – via both official evaluations and academic research – remains essential, current studies, including those conducted outside Europe, already provide an indication of effective design features for implementing the Pay Transparency Directive.

First, the available evidence suggests that pay transparency laws are most effective when they require employers to actively disclose pay outcome information to their employees, rather than providing passive mechanisms that rely on employees requesting such information (Von Beck and Bolingen, 2024; Duchini et al, 2024). This active disclosure leads to greater reduction of the gender pay gap, because it transfers the responsibility to act from the employee to the employer and empowers job applicants and workers to negotiate pay in an informed and transparent manner. Second, public dissemination amplifies positive effects by inviting public scrutiny, which prompts organisations to address disparities in advance (Blundell et al, 2025).

The content of the disclosure is equally important. Disclosing pay gaps is more impactful than disclosing how pay is determined. In addition, detailed pay information is more effective, including breakdowns of gender pay data not only by occupation and level but also by basic and variable pay, and incorporating all forms of employment, including agency workers, etc. The more detailed the data, the more accurately they will be interpreted by workers and companies. Indeed, a small-scale survey among companies and employee representatives by Eurofound (2020) showed that both regard more detailed pay auditing measures as more beneficial than simpler pay reports.

The EU Pay Transparency Directive follows a phased implementation timeline designed to allow Member States and organisations time to adapt to its new reporting requirements. Member States are required to transpose the directive into national legislation by June 2026.

As of September 2025, transposition progress remains limited across Member States. The government of the Fédération Wallonie-Bruxelles in Belgium became the first to fully transpose the directive, in September 2024. Czechia, Malta and Poland all enacted legislation in summer 2025 addressing some aspects of the directive – Malta, covering pre-employment transparency and the right to information (effective August 2025), and Poland, implementing gender-neutral job titles in job advertisements and a salary history ban (effective December 2025). Czechia, meanwhile, introduced measures to prohibit pay secrecy, with fines of up to CZK 400,000 (around €16,000) possible for violations.

Several countries have published draft legislation: Sweden, which issued the first – and so far longest (388 pages) – proposal, in May 2024; Ireland, where provisions regarding pre-employment transparency and a salary history ban were included in the General Scheme of the Equality (Miscellaneous Provisions) Bill 2024, published in January 2025; the Netherlands, which held a public consultation between March and May 2025; and Finland and Lithuania, which both published draft bills in May 2025 to transpose the directive into national law. In addition, France, Germany, Italy, Slovakia and Spain have all started some form of publicly documented preparatory work.

Overall, therefore, concrete progress is being made in just over half the Member States, although full transposition has been achieved only in the Fédération Wallonie-Bruxelles.

Three conclusions emerge. First, systematic evaluation of the effectiveness of pay transparency measures must become standard practice, with government-led evaluations essential for understanding impacts and enabling policy refinement. Second, despite limitations in the evidence, research points to design features that work and those that don’t. The directive – with its range of instruments – already addresses many of the shortcomings of current designs. Member States can be aided by the growing body of literature when developing their transposition legislation. Third, while momentum is likely to increase in the coming months, progress on transposition so far has been limited.