The countdown has already begun. The 7 June marks a key date for European companies: it is the deadline for Member States to bring their legislation into line with the EU Directive 2023/970on pay transparency, legislation that will transform the way organisations manage salaries, recruitment processes and remuneration policies. Beyond legal compliance, the new regulations require organisations to review their internal structures, train managers and prepare HR departments for a scenario in which transparency and pay equity will play a central role.
What is the EU Directive 2023/970 on pay transparency?
The EU Directive 2023/970 aims to to promote equal pay for men and women through greater transparency in wage policies.
Although Spain already has measures in place such as the pay register and pay audits, this directive extends workers’ rights and obligations.
Companies must be able to justify pay differences, provide clear information and ensure more objective and fairer processes.
The 7 June It is an important date because it marks the the start of a new phase in remuneration management. Leaving it until the last minute can make the adaptation process much more complicated.
New requirements for businesses: what you need to have in place
The regulations include changes that will have a direct impact on HR and recruitment processes.
The main obligations include:
- Publishing salary ranges in job advertisements or prior to interviews.
- Do not ask candidates for their salary history.
- Allow employees to request information on average salaries for equivalent roles.
- Prepare reports on the gender pay gap where appropriate.
This means that companies must have more structured pay policies, clearly defined criteria and up-to-date documentation.
What happens if you don’t comply? Penalties and real risks
Failure to comply may result in legal and reputational consequences.
Among the main risks:
- Financial and administrative penalties.
- Claims of pay discrimination.
- Greater exposure to labour inspections.
- Damage to reputation and employer branding.
Furthermore, the Labour Inspectorate will be able to review records, procedures and measures taken to ensure equal pay.
How to prepare HR and managers for new employee rights
Adaptation is not merely about edit documents. It also involves training those who manage people.
Many team leaders will have to conduct pay reviews with a level of transparency they are not used to.
That is why it is important to train managers and HR staff in areas such as:
- Managing salary negotiations.
- Objective criteria for assessment and remuneration.
- Transparent communication.
- Preventing bias.
To have well-prepared leaders will reduce conflicts and improve internal trust.
Practical steps to adapt your business before 7 June
Carry out a pay review
Analysing the current situation is the first step towards adapting to the Pay Transparency Directive. This involves checking for pay disparities between roles of equal value, identifying potential pay gaps, and ensuring that the current criteria for setting salaries are consistent, objective and applied uniformly across the organisation.
It is not just a matter of identifying inequalities, but of understanding their root causes: length of service, responsibilities, individual negotiation or a lack of defined criteria. This assessment will form the basis for any subsequent adjustments.
Document your pay policy
Once the situation has been analysed, it is essential to have a a clear and documented pay policy. This means setting out in writing the criteria the company uses to determine salaries, promotions, pay rises and pay reviews.
Having this structured information allows you to give internal consistency, reducing discretion in decision-making and promoting transparency as required by law. Furthermore, it will be essential for justifying pay differences to employees or during inspections.
Train HR staff and team leaders
The Compliance with the new regulations depends not only on processes, but also on people. HR teams and managers will play a key role in the practical implementation of pay transparency, particularly when it comes to managing discussions with employees.
Training them in remuneration criteria, clear communication and managing expectations will help to prevent conflicts and ensure consistent messaging across the organisation. Managing cultural change will be just as important as ensuring legal compliance.
Review processes and documentation
The final step is review all processes relating to talent management. This includes the way in which job vacancies are advertised, how job categories are structured, and what internal documentation is used to justify pay decisions.
Updating these elements ensures that the twage transparency should not remain merely theoretical, but rather that it is integrated into the day-to-day running of the company. It also makes it easier to trace decisions and reduces risks in the event of audits or inspections.
Pay transparency and fairness: an opportunity for employer branding
Companies that take the initiative will not only be complying with a regulatory obligation: they will also will strengthen their position as employers.
Transparency and fairness are now among the factors that many professionals consider when choosing a company.
From Educa.Pro we help organisations prepare their teams by specialised leadership training, people management and business transformation, facilitating a more agile response to changes in the workplace.
Because compliance is important, but turning that change into a competitive advantage is even more so.
