EU directive on pay transparency: reporting obligation from 2027

Who does the directive apply to?

From 2026, all employees in the EU will have the right to transparent pay information. The directive covers all European companies and includes the full pay package: from base salary to bonuses and benefits in kind. Companies with 100+ employees must report, though Belgium may lower the threshold to 50.

When do you need to act?

Belgium must implement the directive into national law by June 2026. Reporting obligations will start in 2027. Companies should prepare now, because by then, unjustified pay gaps must be closed to avoid penalties.

What will change?

Transparency from the recruitment stage

Employers must communicate openly about remuneration:

• Disclose the starting salary or pay scale in job postings or before the first interview.

• Asking about previous pay is no longer allowed.

• Be clear about the criteria that determine pay.

These rules apply to all employers, regardless of size.

Equal pay for work of equal value

Organisations must be able to demonstrate that their pay policy is fair and gender-neutral:

• Equivalent roles must be remunerated equally.

• Job evaluations must be based on objective criteria such as skills, responsibilities, effort, and working conditions.

Employees have the right to access the criteria used to determine their pay and pay increases. In addition, they may request written information on their individual remuneration as well as the average remuneration, broken down by gender, for employees performing the same or equivalent work.

Employers must inform employees of this right on an annual basis.

Reporting frequency based on company size

Different reporting frequencies apply depending on the number of employees.

Where a pay gap of 5% or more is identified, an action plan must be established.

Sanctions for non-compliance

Member States are required to introduce effective sanctions, including fines and compensation.

In cases of pay discrimination, the employer must compensate the employee for the full amount of outstanding remuneration, including bonuses and benefits. Employees may claim this compensation without any limitation period. The burden of proof lies with the employer, who must demonstrate that the pay policy is objective and gender-neutral.

What does this mean for you as an employer?

This directive is a strategic opportunity to review and strengthen your pay policy:

• Build trust and boost retention through transparent communication.

• Analyse your pay structure—are differences justifiable?

• Understand employee perceptions of fairness—it often matters more than salary itself.

• Document your policy clearly, using gender-neutral and objective criteria.

• Improve internal communication about salary components.

Even smaller companies may feel indirect pressure, especially if clients or public tenders demand compliance.

How can Vandelanotte support you?

We assist with:

• Reviewing and optimising your pay policies

• Designing a transparent and logical pay structure

• Identifying pay gap risks and proposing remedies

• Collecting and preparing relevant data

• Preparing for your reporting obligations