On 7 June 2026, EU Directive 2023/970 on Pay Transparency officially comes into force. Fewer than 90 days remain. For organisations that have not yet begun preparation, the question is no longer “should we act” — it is “can we be ready in time?”
According to Mercer, only 28% of European companies currently have a robust pay transparency audit system in place. The rest risk fines, labour disputes, and — perhaps worse — irreversible reputational damage. This article is the practical guide to pay transparency that was missing.
1. What the Directive Requires: The 5 Pillars of Pay Transparency
EU Directive 2023/970 is not merely about publishing salaries. It introduces structural obligations that touch the entire employee lifecycle:
Pillar 1 — Pre-contractual pay transparency: Candidates have the right to know the salary range before the interview. Asking about previous salary is prohibited.
Pillar 2 — Right to information: Any employee may request aggregated pay transparency data by gender for equivalent roles.
Pillar 3 — Mandatory reporting: Companies with 100+ employees must publish gender pay gap reports. The threshold drops to 150+ in 2027 and 100+ in 2031.
Pillar 4 — Joint assessment: If the pay transparency gap exceeds 5% without objective justification, the organisation is obliged to conduct a joint assessment with employee representatives.
Pillar 5 — Reversal of burden of proof: In pay disputes, it is the employer who must prove there was no discrimination — not the employee who must prove there was.
2. Diagnosis: Where Does Your Organisation Stand?
McKinsey reveals that pay gaps are rarely intentional — they result from the accumulation of bias over years: informal negotiations, unequal progressions, equivalent roles with different titles.
An effective pay transparency diagnosis requires three phases:
Phase 1 — Role mapping: Identify groups of “work of equal value” (not just identical titles, but roles with equivalent complexity, responsibility, and qualifications). The Directive requires objective, gender-neutral criteria.
Phase 2 — Pay audit: Analyse total remuneration (base + variables + benefits) by gender, role, seniority, and location. People analytics tools are essential here — spreadsheets do not scale.
Phase 3 — Gap analysis: Identify where disparities exceed 5% and assess whether there is objective justification (experience, documented performance, market). No justification? A mandatory correction plan.
The UnikPeople platform from Uniksystem offers specific modules for this pay transparency audit: automatic role mapping based on competencies, salary analytics with gender filters, and compliance dashboards that automatically flag disparities above the threshold.
3. The 90-Day Roadmap: From Audit to Compliance
For organisations starting now, there is a critical path to pay transparency compliance:
Weeks 1-2 — Governance: Appoint a pay compliance officer. Involve legal, HR, finance, and employee representatives. Define scope and timeline.
Weeks 3-5 — Data: Consolidate all salary data onto a single platform. Clean inconsistencies (duplicate titles, unclassified roles, untracked variables). This step is where 60% of projects stall.
Weeks 6-8 — Analysis and correction: Execute the audit, identify gaps, and define corrective actions. Retroactive salary adjustments may be necessary. Communicate internally before publishing externally.
Weeks 9-12 — Permanent structures: Implement salary band policies by role, periodic review processes, and automated reporting. Pay transparency is not a project — it is an ongoing practice.
4. Beyond Compliance: Pay Transparency as a Competitive Advantage
The purely legal argument does not tell the full story. Glassdoor reveals that 67% of candidates consider pay transparency a decisive factor when choosing an employer. Deloitte adds that organisations with pay transparency policies register 25-30% reductions in turnover.
The paradox is revealing: many organisations fear that pay transparency will generate dissatisfaction, yet the data shows the opposite. Dissatisfaction comes from the perception of injustice, not from knowledge of the numbers. When employees understand the salary logic — clear criteria, defined bands, transparent progression — trust increases.
Portugal has a unique opportunity here. The business fabric is dominated by SMEs that, by their size, can implement pay transparency more quickly than large corporations. And PRR and Portugal 2030 funds include investments in HR digitalisation that can finance these transformations.
5. The Role of Technology: From Manual to Automatic
Compliance with Directive 2023/970 is, at its core, a challenge of data and processes. Organisations that attempt to manage pay transparency with spreadsheets and emails will fail — not for lack of will, but for lack of scale.
An integrated HR management platform — such as UnikPeople — enables:
- Automatic role classification based on competencies and responsibilities (ISO 20700)
- Real-time pay equity dashboards with automatic alerts for disparities exceeding 5%
- Compliance reports ready for publication, aligned with the format required by the Directive
- Complete audit trail of all pay decisions, protecting the organisation in case of dispute
- Payroll integration to ensure salary adjustments are implemented without manual errors
The difference between being “almost ready” and “ready” almost always lies in the quality of the HR technology infrastructure.
Bonus: Compliance Checklist — Directive 2023/970
- Pay transparency compliance officer appointed
- Salary data consolidated onto a single platform
- Roles mapped by objective, gender-neutral criteria
- Gender pay audit completed
- Gaps exceeding 5% identified and justified/corrected
- Salary band policy defined and communicated
- Periodic review process implemented
- Compliance report drafted
- Internal communication to employees completed
- Process for responding to individual information requests defined
Published by Eva Winter | April 2026