📢 EU Pay Transparency Directive: What It Means for Employers in Malta

Regulating the gender pay gap

As part of the EU’s commitment to gender equality and fair pay, the Pay Transparency Directive (Directive (EU) 2023/970) is set to reshape how companies across Europe—including those in Malta—manage salary transparency, recruitment practices, and internal pay structures.

🔍 What Is the EU Pay Transparency Directive?

Adopted in May 2023 and enforceable in all EU countries by June 2026, this directive aims to eliminate unjustified pay differences between men and women. It introduces a range of mandatory transparency and reporting obligations for employers.

🧩 Key Requirements for Employers

• Salary Transparency in Recruitment

Employers must:

• Include salary ranges in job postings or inform candidates before interviews.

• Avoid asking about past salaries during recruitment.

• Pay Disclosure Rights

Employees can request:

• Average pay levels by gender for roles of equal value.

• Gender Pay Gap Reporting

Mandatory for employers with:

• 250+ employees: Annual reporting

• 100–249 employees: Every 3 years

• Includes data on fixed and variable pay and pay quartiles.

• Joint Pay Assessment

If a gender pay gap of >5% is found without objective justification:

• Employers must conduct a joint pay assessment with employee representatives.

• Ban on Pay Confidentiality

Employment contracts can no longer prevent employees from discussing or disclosing their pay.

• Shift in Burden of Proof

In equal pay disputes, employers must prove that no discrimination took place not the employee.

📅 What’s the Timeline?

• Directive in force: 6 June 2023

• Transposition deadline: 7 June 2026

• First reports may be due as early as 2027, depending on company size.

⚖️ What This Means for Maltese Companies

Malta-based businesses, especially those with cross-border or EU operations, must begin reviewing their:

• Employment contracts

• Recruitment materials

• Salary benchmarking frameworks

• Internal reporting capabilities

🧠 Final Thoughts

The EU Pay Transparency Directive is not just a compliance issue—it’s a cultural shift towards openness, fairness, and trust in the workplace. Proactive employers will gain a competitive edge by fostering equality and transparency.

📞 Need Help? Let’s Talk.

Whether you’re an SME or a large enterprise, BGMT Malta can guide you in preparing for the Directive—without the stress.

We can help in:

✅ Conduct a gap analysis of your current pay structure

✅ Draft compliant employment policies and job descriptions

✅ Prepare for gender pay gap reporting

✅ Align your practices with ESG and diversity goals

Contact us for a consultation or visit bgmtmalta.com to learn more about how we support businesses in staying ahead of EU regulatory changes.