Equal pay, disclosure of wages, gender-neutral recruitment and reporting of differences, possibly from June 2026.
Authors: Zuzana Ďuríková, Tomáš Burián
Directive (EU) 2023/970 of the European Parliament and of the Council on transparent pay strengthens the application of the principle of equal pay for equal work (or work of equal value). It responds to the persistent gender pay gap and, in particular, to practical barriers such as non-transparent remuneration systems, ambiguities in the concept of work of equal value, and a lack of information which makes it difficult for workers to assert their rights.
The Directive uses the term ‘worker’ to refer to persons in an employment relationship or other labor-law relationship under national law and also includes other, atypical forms of employment, provided that they fulfil the characteristics of an employment relationship. Equal treatment and equal pay are already mandatory under Czech law, but the concept of the value of work differs. Czech law assesses the value of work according to its complexity, responsibility, difficulty and also working conditions, performance and results. The Directive, on the other hand, emphasizes skills, effort, responsibility (seniority) and working conditions.
In terms of obligations, the Directive introduces a duty of transparency prior to the establishment of an employment relationship (indication of the starting pay or a salary range in job advertisements, prohibition of questions about one’s salary history, gender-neutral recruitment), as well as internal transparency of remuneration criteria and a broadly defined right to information. As part of this right to information, employers will have to provide employees, upon request, with written information on their individual level of remuneration and the average levels in categories of workers broken down by gender.
In addition, there will be an obligation to report pay gaps to state authorities, for employers with more than 100 employees. As for reporting, the idea is that intervals of one to three years will be set, depending on the size of staff, within which employers will be required to prepare a report on pay gaps.
The transposition is scheduled to take place by June 2026, unless there is a delay or an exemption is granted to the Czech Republic, and the first mandatory reporting will therefore already apply to the whole of 2026 and will apply to employers with more than 150 employees. Given this, companies ought to look into the issue of remuneration even now and critically assess whether their remuneration system at different levels is both transparent and equal.
The Directive does not impose a reporting obligation on employers with fewer than 100 employees, but one cannot rule out that the obligation may in the future also apply to these categories of employers on the basis of national legislation.
We therefore recommend that employers define the individual categories of employees in good time and, where necessary, adjust their performance appraisal methodology to ensure that it is gender-neutral and based on clear, auditable criteria. We also recommend paying attention to the recruitment process, including advertising.
We will be happy to assist you with further elaboration of specific procedures and settings or with any questions you may have regarding this issue.
Source: Pay Transparency Directive (EU) 2023/970 of the European Parliament and of the Council
