New rules on wage transparency on the way

EU directive on pay transparency and the pay gap remain a persistent phenomenon. Despite existing legislation stipulating equal pay, figures from Statistics Netherlands show that women still earn on average 10.3% less than men for equivalent work. That is why European legislators have not been idle: on March 26, 2025, the Dutch government published a draft bill to implement the European Pay Transparency Directive (EU) 2023/970. These new rules will bring about radical changes for employers.

The EU Pay Transparency Directive and the pay gap in the Netherlands create new obligations for employers. The core of the directive is that employers must be more transparent about their remuneration structures and must be able to justify pay differences. This means (among other things) that employees are entitled to information about remuneration criteria and that employers are obliged to report periodically on pay differences between men and women. The most important change is that the burden of proof is shifting. From now on, employers must demonstrate that they pay equally. If they cannot do so, they must explain the difference.

The Netherlands should have implemented the directive by June 7, 2026 at the latest. However, implementation has been postponed. On September 15, 2025, the Informal Council on Employment and Social Policy announced that the Netherlands needs more time to implement the EU Pay Transparency Directive. Therefore, the target date for entry into force is now no later than January 1, 2027. However, the European Directive will already apply on June 7, 2026, and employees will be able to invoke this directive directly from that date. So now is the time to take a close look at your remuneration policy, also in the context of attractive employment practices.

Which (large) employers will be subject to the new rules?

The directive and the reporting obligation it contains initially apply to employers with 100 or more employees. However, the directive also contains an information obligation for employers with more than 50 employees (see point 3 below).

When are there 100 or more employees?

For the purposes of the Directive and the upcoming Dutch implementation legislation, the decisive factor is whether a company “as a rule” has at least 100 employees in the Netherlands. This criterion is in line with existing legal provisions, such as Article 2:153(2)(c) of the Dutch Civil Code and Article 2:263(2)(c) of the Dutch Civil Code (structural arrangement). This refers to the average number of employees over a financial year. Both full-time and part-time employees are included, as are temporary workers who are actually working within the company. Employees working abroad are not included in this threshold.

EU directive on pay transparency and the pay gap in the Netherlands: what will change?

Our government has opted for a ‘pure implementation’ of the European directive. This means that national rules will not be stricter than strictly necessary. Nevertheless, the consequences are significant. The most important changes are listed below:

  1. Objective and gender-neutral pay structures
  2. Employers will be required to use pay structures based on objective, gender-neutral criteria such as skills, efforts, responsibilities, and working conditions. These criteria must be clearly defined, for example in a collective labor agreement or job evaluation system.
  3. Transparency before employment
  4. Applicants must be given clarity in advance about the starting salary or salary range, based on objective criteria. Employers are no longer allowed to ask about an applicant’s current or previous salary, precisely to prevent a repeat of wage differences. Of course, applicants are still allowed to share their salary history of their own accord.
  5. Wage transparency within the organization
  6. Organizations with at least 50 employees must give employees the right to request written information about their own wages and the average wages of colleagues in similar positions. If the employer does not comply with these transparency obligations, the burden of proof in a claim for unequal pay is reversed: the employer must then demonstrate that no prohibited discrimination has taken place.
  7. Reporting obligations for larger employers
  8. Employers with 100 or more employees must report periodically on pay differences between men and women, including bonuses. These reports are partly made public via a national website. The frequency of reporting varies depending on the size of the organization. See below:

Number of employees Reporting period First report no later than

100 – 149 Every 3 years June 7, 2031

150 – 249 Every 3 years June 7, 2027

250 or more Every year June 7, 2027

  1. Mandatory wage evaluation in case of differences
  2. If the report shows that there are unjustified wage differences, the employer must take measures within a reasonable period of time, in consultation with the works council. In case of differences of 5% or more that still exist after six months, a mandatory wage evaluation will follow, including an analysis, an action plan, and an evaluation of previous measures. The works council must agree to this plan.
  3. Role of the works council
  4. The works council will play a central role in ensuring equal pay and monitoring compliance with the new obligations. This includes the right of consent to the remuneration policy, helping to resolve unjustified differences, and assessing the pay reports. In collective bargaining situations, trade unions can take over these tasks, provided that the collective bargaining agreement provides for this.

Practical tips and preparation

It is wise to take action now:

  • Identify the number of employees: Calculate the average number of employees over the financial year, including part-timers and temporary workers.
  • Document job classification system: Clearly define job descriptions and equivalent positions.
  • Analyze remuneration structures: Investigate whether there are any unexplained wage differences and establish objective remuneration criteria.
  • Implement reporting systems: Ensure that systems are in place that make it easy to report on remuneration differences on a regular basis.
  • Involve the works council in good time: Discuss the current wage structures and the objective criteria.
  • Evaluate regularly: Conduct internal audits and draw up improvement plans where necessary.
  • Inform and train the HR department and management: Ensure that those responsible are aware of their obligations and know how to answer questions from employees.
  • Communicate with employees: Inform employees in good time about their rights and how equal pay is guaranteed.

Conclusion

For companies with 100 or more employees in the Netherlands, it is essential to anticipate the Pay Transparency Directive in a timely manner. By anticipating the EU Pay Transparency Directive and the pay gap in the Netherlands in a timely manner, large employers can limit risks (such as claims for back pay) and comply with future legislation. Do you have questions about adjusting your remuneration policy in response to the Pay Transparency Directive? Please feel free to contact LVH Advocaten. We are happy to assist you.

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