EU Pay Transparency: Right to Information on Pay — Response Template

1. Legal Framework: EU 2023/970

Directive (EU) 2023/970 of 10 May 2023 to strengthen the application of the principle of equal pay for equal work or work of equal value between men and women through pay transparency and enforcement mechanisms is the central European regulation. It operationalizes Art. 157 TFEU (equal pay for equal work) and replaces parts of the previous Equal Treatment Directive 2006/54/EC.

Member States must transpose the Directive into national law by 7 June 2026. In Germany, transposition is expected through a reform of the Pay Transparency Act (Entgelttransparenzgesetz, EntgTranspG) and amendments to the General Equal Treatment Act (AGG).

2. Scope

The Directive applies to all employers in the public and private sector (Art. 2(1)) — unlike the German EntgTranspG, which currently applies only from 200 employees onwards. The personal scope covers all workers with an employment contract or employment relationship under applicable national law (Art. 2(2)). In particular:

• Full-time and part-time staff
• Fixed-term employees
• Agency workers (assessed against the user undertaking)
• Civil servants, to the extent they are treated as workers under national law

3. Right to Information (Art. 7)

The central individual right of every worker comprises two core elements:

• Individual pay level — the personally expected remuneration
• Average pay levels for the category of workers performing the same work or work of equal value — broken down by sex

"Work of equal value" is defined in Art. 4 by reference to objective criteria: requirements regarding education, vocational training, skills, responsibility, effort, and working conditions. The employer must make analytical job-evaluation systems available (Art. 4(4)) that map these criteria in a gender-neutral way.

3.1 Form and Deadline

• Form of request: governed by national transposition. Recommended: written, with date and specific position
• Response deadline: 2 months from receipt (Art. 7(4))
• Response form: in writing, in plain language, with an explanation of the calculation methodology where appropriate
• Confidentiality: workers may not freely disclose the information received, except as needed to enforce the right to equal pay (Art. 7(5))

3.2 Annual Information Duty (Art. 7(3))

Employers must inform all workers once per year of their right to information. In practice this is most easily handled through the HR department, an intranet notice, or an annex to the payslip.

4. Pay-Gap Reporting Thresholds (Art. 9)

In addition to the individual right to information, Art. 9 requires aggregate reporting on the gender pay gap. Obligations are staggered by employer size:

• 250 or more workers: first report by 07.06.2027, then annually
• 150–249 workers: first report by 07.06.2027, then every 3 years
• 100–149 workers: first report by 07.06.2031, then every 3 years
• Below 100 workers: no reporting obligation under the Directive; national rules may be stricter

4.1 Reporting Contents (Art. 9(1))

The report must contain:

• Gender pay gap (mean and median)
• Pay gap in complementary or variable components (bonuses, premiums, commissions)
• Proportion of female and male workers receiving these complementary or variable components
• Proportion of female and male workers in each pay quartile
• Pay gap by category of workers, broken down by ordinary basic salary and complementary components

5. Joint Pay Assessment (Art. 10)

Where the report shows, in a worker category, a gender pay gap of more than 5% that is not justified by objective gender-neutral criteria and that the employer does not remedy within 6 months from publication of the report, a joint pay assessment with the workers' representatives must be carried out.

The assessment includes (Art. 10(2)):

• Analysis of the share of female and male workers in each category
• Detailed breakdown of average pay levels and complementary components
• Identification of any inequalities in work of equal value
• Reasons for the differences plus objective justifications
• Measures to remedy the inequalities
• Report on the effectiveness of previous measures

6. Reversal of Burden of Proof (Art. 18)

Where a worker establishes facts from which it may be presumed that pay discrimination has occurred, it is for the employer to prove that no discrimination has taken place. If the employer breaches the transparency obligations in Articles 5 to 9, the burden of proof reverses automatically (Art. 18(2)).

Practical consequence: insufficient documentation of job evaluation becomes an independent liability risk.

7. Response Template for Right-to-Information Requests

The employer's response should follow this structure:

8. Relationship with the German Pay Transparency Act (EntgTranspG)

The German Pay Transparency Act (EntgTranspG) has been in force since 06.07.2017. It already contains a right to information (§ 10 ff.), but with considerably narrower preconditions:

• Only in establishments with more than 200 employees at the same employer
• Information on the median gross monthly salary of a comparator group of at least six employees of the opposite sex in equivalent work
• Request cycle: every 2 years
• Reduced burden for tariff-bound employers

The EU Directive substantially tightens the regime: no threshold for the right to information, breakdown by mean and median, annual information instead of biennial cycle, automatic reversal of the burden of proof on transparency violations. Reform of the EntgTranspG before June 2026 is therefore inevitable.

9. Sanctions (Art. 23)

Member States must provide for effective, proportionate, and dissuasive sanctions. The Directive specifically mentions fines, which national law may link to turnover or to the severity of the breach. Repeated breaches may trigger increases as well as exclusion from public contracts and grants (Art. 24).

10. Practical Roadmap for Employers

Recommended preparation steps before June 2026:

• Q1–Q2 2026: establish or validate the job evaluation system (analytical, gender-neutral)
• Q2 2026: prepare employee information leaflet and response templates, define the process for the 2-month deadline
• Q3 2026: run pay-gap analysis internally (pilot), check data quality
• Until June 2027: first official pay-gap report (from 150 employees) — initiate corrective measures if gap exceeds 5%
• Ongoing: document annual employee information about the right to information

Summary

The EU Pay Transparency Directive turns pay equity from a soft aspiration into a documentation-driven obligation with reversed burden of proof. The right-to-information request is the operational starting point — every employer needs a ready response template, a defined process for the two-month deadline, and an analytical job-evaluation system that can defend the numbers. Build these three components before June 2026 and the rest of the directive becomes manageable.

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