Pay Transparency: Your most urgent questions answered

The Pay Transparency Directive is set to transform how organisations handle salaries, equity, and reporting. During our recent webinar, attendees raised key questions about its impact and how to stay compliant. 

In this blog, we break down the most pressing questions with clear, expert-backed answers to help you navigate the changes with confidence.

If we identify pay gaps, what should a plan or timeline to diminish them look like? 

The directive states that unjust pay gaps must be addressed urgently, but each country will provide further clarification in its national legislation. A solid plan should include immediate corrective actions, a timeline for review, and ongoing monitoring to ensure compliance and long-term fairness. 

What are the must-do vs. can-do actions under this directive? 

While each country will interpret the directive slightly differently, key "must-do" actions include publishing salary ranges, initial pay levels, and ensuring employees have the right to request salary comparisons. Additional transparency measures may be encouraged but not legally required, depending on national regulations. 

What’s the correct way to report pay gaps – median or average? 

Employers must report both the mean and median pay gaps at an aggregated level. However, for position-based pay gap reporting, only the mean salary data is required, along with an explanation for any gaps. 

Does full pay transparency mean there can’t be any pay gaps?

No. Performance, experience, tenure, and other gender-neutral factors can still justify pay differences. The directive aims to ensure that any pay gaps are explainable, fair, and not based on gender discrimination. 

What constitutes “equivalent work” if job titles vary across roles? 

The principle of equal work does not mean employees must have the same job title. Employers should assess whether roles require similar skills, education, and responsibilities to define equal work groups, which is something Sympa’s tools will be able to help with. 

What’s a good salary scale for a specific role? 

A reasonable salary range should be based on existing salary structures within the company, adjusted with external market data where relevant. A €1000 range can work in some cases, but it depends on the role, industry, and market trends. 

How does the directive impact regional salary differences? 

Regional salary variations are allowed, as cost of living is a gender-neutral factor. Employees in equivalent roles can earn different salaries depending on their location, as long as this is consistently applied and justifiable. 

Does the directive only focus on gender pay gaps? 

Yes, the directive primarily aims to close the gender pay gap in the EU. It includes the right for employees to request for pay information and requires employers to take action when unexplained gaps of 5% or more are identified. Keep in mind that local pay equity laws may impose additional requirements.

Should management salaries be included in pay gap calculations? 

Yes. All employees, including executives and management team members, must be included when calculating the organisation’s overall gender pay gap. 

What data needs to be gathered for pay transparency compliance? 

This depends on each country’s specific implementation of the directive. If you need guidance, Sympa and Pihr can help you determine the exact data requirements for your location. 

What does “right to information” mean for salary transparency? 

Employees can request to know how their salary compares to their peers in equal or equivalent roles. However, this does not mean that individual salaries must be disclosed — only comparisons to average salaries for equivalent roles. 

How do we define “equal work” in a company with many job titles? 

Employers should conduct a job analysis to cluster similar roles based on required skills, education, and impact. If employees perform comparable tasks, even under different titles, they may be classified as performing “equal work.” 

How does the 5% rule apply? 

The 5% pay gap rule applies across both equal and equivalent positions within a company. If a gender-based pay gap of 5% or more exists in a role, the employer must justify or rectify it. 

Are historical salary discrepancies a valid justification for pay gaps? 

This depends on local legislation. In some cases, if a salary was historically high due to market conditions at the time, this may be accepted as a justification. However, if the gap persists over time, employers may need to address it. 

Where can companies get guidance on job evaluations? 

Several job evaluation frameworks exist, such as Mercer-IPE, KornFerry-Grades, Willis Towers Watson-Global Grading, and Pihr Evaluation. Choosing a system that fits your company’s size, structure, and locations is crucial. Sympa and Pihr can assist in finding the right fit. 

Pay transparency is a complex but necessary step toward fairer workplaces. While the directive sets the foundation, companies must take proactive steps to align with national legislation and industry best practices. Sympa is here to help, whether through our HR tools, expert guidance, or industry insights.

If you have further questions, reach out to us for tailored support on your journey toward pay equity.