What You Need to Know About EU Gender Pay Gap Reporting Requirements 

The EU Pay Transparency Directive is set to become a game-changer for gender equality in the workplace. Designed to close the gender pay gap, it introduces detailed gender pay gap reporting requirements for employers across the EU. If your organisation hasn’t already started preparing, now is the time to act. 

In this blog, we’ll begin with a brief overview of the EU Pay Transparency Directive before outlining the specific gender pay gap reporting requirements and the key steps organisations need to take to prepare. 

Understanding the Directive 

The EU Pay Transparency Directive mandates that employers go beyond general pay gap reporting and disclose gender pay disparities by categories of workers performing equal work or work of equal value. This marks a significant evolution in compliance requirements: organisations can no longer rely on job titles alone; they must be able to systematically group roles based on their underlying value to the organisation. 

To meet this standard, a robust job evaluation methodology is essential. Job evaluation is the structured process of assessing the relative worth of roles by comparing them using consistent and objective criteria. This allows organisations to determine which roles are truly equivalent, regardless of job titles or where they sit in the organisational hierarchy. 

Under the Directive, the factors used to evaluate whether work is of equal value include: 

• Skills
• Effort
• Responsibilty
• Working conditions

These are well-established principles in job evaluation and align with common frameworks used in compensation design. Importantly, the Directive requires that these evaluations are transparent, gender-neutral and consistently applied. 

What do employers need to report?

To meet the reporting requirements, organisations must disclose the following:

1. The mean gender pay gap for base pay
   This is the average difference in basic pay between men and women, calculated across the organisation.
2. The mean gender pay gap for complementary or variable components
   This refers to bonuses, commissions or other incentive pay and their average differences by gender.
3. The median gender pay gap for base pay
   The middle value when listing all male and female base pay figures in ascending order. This measure is less affected by extreme salaries.
4. The median gender pay gap for complementary or variable components
   Same as above but focused on variable pay.
5. The proportion of female and male workers receiving variable pay
   A critical metric to uncover gender-based differences in access to bonuses and incentives.
6. The proportion of female and male workers in each quartile pay band
   This shows the gender distribution from the lowest to the highest pay levels, helping visualise representation across pay scales.
7. The mean gender pay gap by category of workers (basic and variable components)
   This requirement ties all the above together—employers must break down pay gaps within categories of equal work or value.

Compliance Timelines & EU Gender Pay Gap Reporting Requirements

A company’s obligations under the Directive depend on its size: 

• 250+ employees: Annual reporting starts in June 2027, covering the 2026 calendar year 
• 150–249 employees: Reporting required every three years starting from June 2027 
• 100–149 employees: Reporting every three years starting from June 2031 

Regardless of timing, all affected organisations should begin preparations now.  

The Crucial Role of Job Groupings & Evaluation 

Complying with EU gender pay gap reporting hinges on one critical capability: your organisation must be able to group jobs of equal work or equal value. This means relying on objective criteria, such as skills, responsibilities, effort and working conditions, to evaluate and categorise jobs. 

Without this groundwork, reporting becomes nearly impossible. Simply comparing people with the same job title isn’t enough. You must ensure a standardised and auditable system of job evaluation. 

Operational Implications: What you must do now

Review and Standardise Job Descriptions 

To ensure consistency and comparability with EU gender pay gap reporting requirements, organisations must establish clear governance over job descriptions. That means: 

• Defining what each job entails (level, responsibilities) 
• Defining the skills, competencies and proficiency levels required for each role 
• Documenting changes over time 
• Preventing “scope creep,” where a role evolves informally, leading to discrepancies in pay 

Centralise and Audit Job Data 

Employers must maintain an audit trail of job content even for positions that no longer exist. This historical data may be required for post-employment requests or internal audits. 

By centralising job descriptions and evaluation data, you allow for easy comparison across job groupings, enabling EU Gender pay gap reporting transparency and compliance. 

3. Conduct a Job Evaluation 

If your organisation doesn’t already have a robust job evaluation framework, now is the time to implement one. Evaluating jobs based on value — not just job titles or pay — will be essential to segment workers appropriately for reporting. 

Conclusion: Act Now  

The EU Pay Transparency Directive introduces complex and detailed reporting requirements, especially when it comes to EU Gender Pay Gap reporting. However, the objective is simple: ensure fair pay for work of equal value. To succeed, employers must get their job data in order, adopt robust job evaluation frameworks and understand their workforce from a value-based lens.