The Equal Pay Directive: how large undertakings should prepare

Directive (EU) 2023/970 strengthens the application of equal pay for equal work or work of equal value. Even where national transposition is delayed, the direction of travel is clear and organisational preparation takes months rather than weeks.

1. Establish ownership of the project

Create a cross-functional team involving management, HR, legal, payroll and data protection. Define responsibilities, access rights, decision-making and a realistic timetable.

2. Map jobs and remuneration

Build a reliable inventory of roles, grades, pay components and benefits. Job titles alone are not enough: the comparison must reflect skills, effort, responsibility and working conditions.

3. Define objective, gender-neutral criteria

Document the criteria for recruitment, pay progression, bonuses and promotion. Informal discretion must be replaced by rules capable of explanation and consistent application.

4. Test for pay gaps

Analyse comparable groups, the reasons for differences and the quality of the underlying data. A statistical difference is the beginning of the legal analysis, not its conclusion.

5. Prepare recruitment and employee information

Applicants will require meaningful pay information, while employees will have rights to understand pay-setting and request comparative data. Prepare notices, procedures and response templates.

6. Protect personal data

Pay analysis involves sensitive employment information. Apply data minimisation, role-based access, retention controls and secure reporting.

7. Plan remediation and communication

Unjustified differences require correction. Budget for remediation, document decisions and prepare managers to communicate clearly without disclosing individual remuneration.

8. Treat transparency as governance

The enduring result should be a transparent remuneration system, not a one-off report. Review the model regularly as roles, structures and legal requirements change.