Poland Prepares for EU Pay Transparency Directive: Employers Face New Obligations

In less than a year and a half, Poland is expected to implement the EU Pay Transparency Directive, requiring employers to disclose salary ranges for job positions and provide pay information to employees. This directive, aimed at reducing the gender pay gap, will necessitate systematic pay structures and, in some cases, mandatory reporting.

“The Pay Transparency Directive will introduce significant changes to wage policies. One of its key provisions is that all employers must ensure that their pay systems guarantee equal pay for employees performing the same job or work of equal value,”
— Dr. Małgorzata Kurzynoga, Professor at the University of Łódź and Partner at BKB Baran Książek Bigaj Law Firm.

“Employers must review and evaluate their existing pay structures. Aligning wage systems with the directive’s requirements will be a long-term process, requiring regular reassessments.”

Key Requirements of the EU Pay Transparency Directive

Adopted in May 2023, the directive must be transposed into Polish law by June 7, 2026. It imposes several transparency obligations on employers, including:

1. Salary Disclosure in Job Listings
   • Employers must provide clear salary ranges or starting salaries in job advertisements or before interviews.
   • This measure ensures equal opportunities in salary negotiations, particularly regardless of gender.
2. Employee Access to Pay Information
   • Employees will have the right to request salary data, including:
     • The average pay of colleagues in similar positions,
     • Salary comparisons broken down by gender.
   • Requests can be made directly or through employee representatives.
3. Mandatory Pay Reporting for Large Employers
   • Companies with at least 100 employees must report salary data to a monitoring authority, which will publish the information online.
   • Reporting obligations will be introduced gradually:
     • Companies with 250+ employees – First report due by June 7, 2027, then annually.
     • Companies with 150–249 employees – First report due by June 7, 2027, then every three years.
     • Companies with 100–149 employees – First report due by June 7, 2031, then every three years.
   • Reports must include:
     • Gender pay gaps,
     • Salary differences in bonuses and additional pay,
     • Percentage of male and female employees receiving bonuses,
     • Distribution of male and female employees across salary brackets.

Expected Impact on Employers and the Labor Market

The directive aims to close the gender pay gap, which remains a persistent issue in Poland and across the EU.

• Poland’s gender pay gap (2022, Eurostat): 7.8% (one of the lowest in the EU).
• EU average pay gap: 12.7% (highest in Estonia: 21.3%, lowest in Luxembourg: -0.7%).
• Poland’s median salary gap (July 2024, GUS):
  • Men: 6,899.50 PLN (485.54 PLN higher than women).
  • Men earned 3.9% more than the median, while women earned 3.4% less.
  • Average male salary was 5% above the mean, while female salaries were 5.2% below.

“European countries that introduced pay transparency measures earlier have seen positive effects.
In the UK, for example, the pay gap shrank by 19% after mandatory reporting was introduced,”
— Dr. Kurzynoga.

“Women are more likely to receive promotions in companies required to report pay gaps. Employers with large pay disparities struggle to attract female talent, pushing them to address wage imbalances.”

Employer Concerns Over Transparency Requirements

Employers fear the financial impact of the directive, as closing pay gaps may require salary adjustments.

“Employers are worried about the financial burden of equalizing wages and the potential increase in legal claims.
Currently, employees rarely pursue pay discrimination claims because they lack the necessary salary data.
With pay transparency, they will have more information to challenge unfair pay structures,”
— Dr. Kurzynoga.

Poland’s Legislative Efforts Toward Pay Transparency

In December 2023, the Ministry of Family, Labor, and Social Policy established a working group to prepare the directive’s implementation into Polish law.

“This team faces major challenges,”
— Dr. Kurzynoga.

“One key issue is limiting retroactive claims. The directive states that the statute of limitations for discrimination claims should not start until the employee becomes aware of the discrimination. However, Polish law must also set clear time limits to prevent lawsuits over pay disputes from decades ago.”

Global lawsuits against major corporations like Goldman Sachs, Disney, and Google highlight how employees often file claims for pay discrimination that occurred years earlier.

On January 24, 2024, the Polish Parliament (Sejm) held the first reading of a separate Pay Transparency Bill, proposed by opposition party Koalicja Obywatelska (KO).

• The bill aligns with EU objectives but is not a direct implementation of the directive.
• It proposes:
  • Mandatory salary disclosure in job postings.
  • Ending confidentiality clauses on employee wages.

As Poland prepares to implement the directive, businesses must adapt their pay structures and prepare for new transparency obligations, which could reshape the labor market and narrow wage disparities.

Source: CEO.com.pl