Directive (EU) 2023/970 on pay transparency primarily aims to strengthen the enforcement of the principle of equal pay for women and men for the same work or for work of equal value. To this end, the Directive establishes mechanisms designed to ensure that pay differences are based on objective, gender-neutral criteria, such as skills, effort, responsibility and working conditions, and, where applicable, any other factors relevant to the job or position in question.
The European legal framework on pay transparency has not yet been transposed into Romanian law; however, the transposition deadline, i.e. 7 June 2026, is approaching. For this reason, it is helpful to briefly outline the rights the Directive introduces for job applicants and workers, as well as the new obligations it will impose on employers.
- Job applicants have the right to receive from the prospective employer information on the initial pay level and, where applicable, on the relevant provisions of the applicable collective labour agreement for the position in question.
The Directive does not impose an automatic obligation on employers to publish the remuneration for a position in the job vacancy notice. However, employers must ensure that information on the initial pay level is communicated to the applicant prior to the job interview, so that pay negotiations can take place on an informed basis.
- Employers are prohibited from asking job applicants about their pay history.
- Employers must ensure that workers have easy access to the criteria used to determine workers’ pay, pay levels and pay progression.
- Workers have the right to request and receive, in writing, information on their individual pay level, as well as on the average pay levels, broken down by sex, for categories of workers performing the same work or work of equal value.
The exercise of this right does not entitle the worker to receive a list of colleagues’ individual pay identified by name. In practice, employers will provide average figures per job category, broken down by sex, without disclosing the identity of individual workers.
- Clauses that prevent workers from disclosing information about their own pay are prohibited, in particular where such disclosure is intended to ensure the enforcement of the principle of equal pay.
- Workers who consider themselves to have been discriminated against in relation to equal pay must have access to easily accessible judicial procedures for the protection of their rights.
- Workers who have sustained damage as a result of a breach of the principle of equal pay are entitled to full compensation, without the legislator being allowed to set a prior upper limit on such compensation.
- Employers will be required to report periodically to the authorities designated by the national transposing legislation a set of information reflecting potential pay gaps between women and men, in order to enable the monitoring of compliance with the principle of equal pay within the organisation.
The reporting calendar is phased according to the number of workers employed, as follows:
- Employers with at least 250 workers must submit the information by 7 June 2027 for the preceding calendar year and thereafter on an annual basis;
- Employers with 150–249 workers must submit the information by 7 June 2027 for the preceding calendar year and thereafter once every three years;
- Employers with 100–149 workers must submit the information by 7 June 2031 for the preceding calendar year and thereafter once every three years.
Employers with less than 100 workers are not automatically exempt from any reporting obligations. The national legislator may, through the transposing legislation, introduce reporting obligations also for these employers. Consequently, close attention should be paid to how the Romanian legislator will transpose the Directive into domestic law, including regarding the possible extension of reporting obligations below the threshold of 100 workers.
For both employers and workers, it is essential to understand that the concept of “pay” under the Directive is not limited to basic salary, but covers any consideration granted to the worker, directly or indirectly, in cash or in kind. This includes bonuses, premiums and allowances, as well as non-monetary benefits, such as professional development programmes or other forms of complementary remuneration.
Even though the specific way the Directive will be transposed into national law is not yet known, employers and workers can already use the European framework as a benchmark to assess whether pay practices are transparent, based on objective criteria and compliant with the principle of equal pay.