The EU Pay Transparency Directive (2023/970): Is Your Business Ready for 2026?

Pay Transparency – Directive (EU) 2023/970

In an increasingly complex labor market, offering the right salary is always a challenge, especially if that salary must be not only fair but also transparent and future-oriented. And yet, this is an absolute necessity. A good salary in itself does not necessarily motivate employees more, but it is often a decisive factor when they choose an employer or decide to look elsewhere.

Salaries are simultaneously a taboo subject and a hot topic of discussion in the workplace. The issue is a source of headaches for employers, whether it comes to explaining the value of remuneration and fringe benefits or justifying pay differences between employees. But the Pay Transparency Directive (EU) 2023/970 is about to change things.

For the first time, employers will be obligated not only to guarantee equal pay for equal work and work of equal value, but also to ensure transparency in the very processes of determining and reviewing remuneration—from the job advertisement to the annual bonus.

The Approaching June 2026 Deadline

With Directive (EU) 2023/970, Europe aims to combat pay discrimination, specifically the gender pay gap. It will come into effect in June 2026, but currently, only a quarter of employers know exactly what it entails. More than a third are not even familiar with the content of these requirements. Furthermore, at the national level in Bulgaria, no concrete actions have yet been taken, despite the approaching deadline.

Administrative burden, a high risk of errors, and loss of time: the complexity of the regulatory framework poses numerous challenges for businesses. Add to this the rapid development of legislation and numerous exceptions and special provisions, and you get the perfect recipe for questions and uncertainties for employers.